The United Nations fraud detection unit, otherwise known as the Office of Internal Oversight Services (OIOS) has recently been to Mogadishu, Somalia to evaluate the performance and value for money provided by contractors to the United Nations mission in country.
Although their findings remain largely confidential and for internal UN scrutiny only it is understood that the OIOS has discovered large irregularities in the performance of Supreme Fuels Trading FZE and their management of UNSOA’s fuel contract.
A source inside UNSOA has stated that millions of litres of high quality diesel and jet fuel are unaccounted for and may have found their way onto the black market in Mogadishu thereby depriving both the UN of vital operational fuel as well as the taxes due on commercial fuel for the Treasury of the Somali Federal Government.
It is alleged that this gross mismanagement relates to the use of pre paid fuel cards issued by Supreme Fuels Trading FZE to both United Nations Agencies as well as AMISOM. These cards, with as much as $5,000 USD of fuel credits, have been issued widely and their use was not controlled by Supreme.
This has led to various Third Parties selling the cards on to various unknown parties and a further lack of Supreme’s management at the UN’s kerbsiderefuelling facilities has enabled unauthorised vehicles and personnel to get away with millions of litres of fuel. Supreme have been supplying the United Nations in Somalia for the past 4 years and what the OIOS have yet to get to the bottom of is exactly how long this fraud has been perpetrated and exactly what level of sanction should be levelled against Supreme.
This is not the first occasion that Supreme have been accused of blatant accounting irregularities. A recent shipment of fuel to port of Mogadishu was the subject of investigation by the Federal Government of Somalia.
Supreme had declared that the whole shipment was for the use of UNSOA and thereby tax exempt but the reality was that over half the cargo was purchased to support their taxable, commercial operations in the country. The Government acted quickly and Supreme was fined heavily for this breach of trust and regulations. In addition to this episode Supreme is also in the grip of a long running court battle with the US Government over their conduct and running of the lucrative food contract in Afghanistan.
The breaches of contract here rise to nearly a Billion USD of overcharging and the US Government is attempting to reclaim this money through the courts. Questionable business practice and tax avoidance seem to be standard wherever Supreme operates.
The question remains: how long can they go on operating like this before more meaningful sanctions are taken against them? Fines do not hurt this massive company, other options must be considered and quickly.”