Public Accounts Committee Orders Union Trust Bank to Settle Discrepancies and Addresses Manager’s Negligence

In an ongoing series of hearings focused on the queries raised in the Auditor General’s Reports for the financial years 2021 and 2022, the Public Accounts Committee (PAC) of the Sierra Leone Parliament has made significant decisions regarding Union Trust Bank (UTB) Kenema Branch. The hearings, chaired by Deputy Speaker Hon. Ibrahim Tawa Conteh, culminated on Wednesday, September 4, 2024, with crucial directives aimed at addressing financial discrepancies and managerial accountability.

• Payment Directive: The PAC has ordered UTB Kenema Branch to remit 460 million old Leone into the Sierra Leone Road Safety Authority (SLRSA) account. This decision comes in response to a financial discrepancy totaling 471 million old Leone, which was highlighted in the Auditor General’s Report for 2022. The discrepancy relates to a misalignment between the records of the account holder and those of the bank.
• Fines and Sanctions: The PAC has also ruled that the Bank Manager of UTB Kenema Branch must pay a fine of 11 million old Leone. This penalty is imposed for negligence and a failure to conduct due diligence in managing the bank’s affairs. The PAC has given the manager two months to settle this fine.
• Recommended Actions: In addition to the fine, the PAC has recommended that the manager be suspended, transferred, and demoted below the rank of Branch Manager. This recommendation underscores the PAC’s commitment to enforcing accountability and upholding standards of financial management within the banking sector.
• Ministry of Finance Requests: The Deputy Speaker disclosed that, following a recent PAC ruling on budgetary enhancements, the Ministry of Finance has received requests from various Ministries, Departments, and Agencies (MDAs) amounting to 198 billion old Leone. These requests are now subject to PAC approval.
• Previous Procedures: Traditionally, such requests for budgetary enhancements would have been processed by the Ministry of Finance without needing parliamentary approval. The current requirement for PAC approval represents a significant shift in how budgetary matters are handled, emphasizing increased parliamentary oversight and transparency.

Understanding Budgetary Enhancements:

• Definition: Budgetary enhancements refer to additional funds requested beyond the initially approved budget by Parliament for specific services or projects. These funds are crucial for addressing unforeseen expenses or expanding programmatic activities.
• Enhanced Scrutiny: The PAC’s actions reflect a strengthened approach to financial oversight and accountability. By addressing discrepancies and holding individuals accountable, the PAC aims to reinforce trust in public financial management and ensure that resources are used effectively.
• Banking Sector Reforms: The directives to UTB Kenema Branch highlight the need for rigorous financial controls and accountability within the banking sector. This incident may prompt other financial institutions to review their practices and enhance their due diligence processes to avoid similar issues.

Increased Parliamentary Role: The shift in processing budgetary enhancements through PAC approval signifies a broader trend towards increased parliamentary involvement in financial matters. This change aims to foster greater transparency and oversight in the allocation and use of public funds.

In summary, the recent hearings and decisions by the Public Accounts Committee signify a pivotal moment in Sierra Leone’s approach to financial oversight and accountability. The orders directed at UTB Kenema Branch, combined with the new procedures for handling budgetary enhancements, reflect a commitment to improving financial management practices and ensuring that public resources are managed with integrity and transparency.