LATEST OFFICE OF PUBLIC AUDITOR REPORT ON CHUUK

FSM Information Services
Palikir, Pohnpei
August 27, 2009

CHUUK AUDIT SHOWS PROJECT IRREGULARITIES

The Office of the National Public Auditor announces the release of Report No. 2009-04, "Audit of Congress Funded Public Projects in Chuuk State."

The report is available for public review online at the Web site www.fsmopa.fm and copies are available at the auditor’s offices in Palikir and Weno.

The audit was performed with the objectives of determining whether the administration of congressionally funded public projects complied with applicable laws, policies, and regulations.

The FSM Congress appropriated approximately $1 million in local revenue funds from Public Law 13-36 for the purpose of funding social and economic projects, often referred to as CFSM public projects, in Chuuk.

The audit team examined 39 of the 69 funded projects and focused on fiscal years 2005- 2008, through July 31, 2008, appropriations.

The audit was conducted in accordance with generally accepted government auditing standards.

The audit team found that parties involved in the selection, management, and oversight of the projects failed to comply with applicable laws, policies, and regulations.

Moreover, the overall process from the selection of projects to the payment of vendors was conducted without the benefit of appropriate management controls.

The audit team found that the project selection process occurred without any documentation as to why the selected projects were chosen, how they would contribute to the social and economic development of Chuuk, or what criteria was used to select projects.

The audit revealed that neither the Chuuk State Commission on Improvement Projects nor the FSM Finance Field Office in Chuuk could account for vehicles, boats, and boat engines purchased with P.L. 13-36 funds.

Seven vehicles, four boats, and 10 engines were purchased in conjunction with the 39 projects reviewed.

However, no boats or engines could be located or accounted for.

Similarly, six of the seven vehicles could not be located or accounted for.

Though project control documents are intended to ensure that all purchases are for the project’s intended purpose and within authorized limits, the audit team found that not all expenditures were appropriate and/or within the budget.

The Chuuk Delegation Office project and the Chuuk Delegation Office Operations project had the stated purposes of defraying operating costs.

However, funds were used to pay reimbursements to Congress members and to make contributions to constituents.

In essence, these funds were used as representation funds although the original intent was for the operations of the Chuuk Delegation Office.

Auditors also found that funds for a fishing project were used to purchase a vehicle and construction material.

A total of 21 of the 69 projects reviewed exceeded the dollar amount appropriated by law.

The audit also revealed that there were no controls to ensure projects were completed.

Site inspections conducted by the audit team revealed that several of these projects such as sea walls, a pathway, and a meeting hall were never completed.

Furthermore, payments for construction materials related to these projects were paid though the materials could not be accounted for because the FSM Finance Field Office did not require submittal of a completed inspection report.

Some of the findings have been referred to the Compliance Investigation Division for further review.

Comments

  • Sarem Chuuk,

    Why did you and Public Auditor ever bother? There was nothing new with our leaders, all corrupted! Go back and read previous audit reports since FSM became so called "self governmen" under the Compact. Rembember one of our governor was giving our state hugh government check to his daughter? Supposely to pay for sand, rememba? Now the man is living in Hawaii from $ he and his family looted from the government. All our government, elected and non-elected officials are helping themselves to public funds. Department of Education recent Audit report, ya. Now our people are beggers in Hawaii. The State of Hawaii is pulling the rug under them; they are begging for help.
  • --and sooner or later the State of Hawhee will run out of Pineapples and sugarcane; leaving the land with bunch of pan handlers.
  • lets give palikir post a bigger applausss...

    cuyber maniac..dont bother...

    KN..lets be friend...pls..
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  • Vanuatu:

    I am not sure which prior audit report you are referring to when you say "I must say that I was very pleased to hear the result of the last audit report of Chuuk State," because my recollection is that the report which preceded this one strongly criticized the Chuuk Department of Education. To be fair, I may have missed one.

    And I am sorry, I didn't misread the audit report. I copied it verbatim from the Pacific Islands Report this AM.

    By the way, it is exactly this kind of corruption which led to the convictions of Jack Fritz, his cousin James (then head of the CCIP), Frank Darra, former Associate Justice John Petewon, and others, including former Congressman Simeon Innocenti. All of the wrongdoing which was alleged and proven against those former public officials was related to FSM Congress money appropriated for Chuuk Special Projects. Even the convictions did not slow down the corruption, or alter it in any way. Apparently, it is profitable enough to cheat, even if somebody gets caught.
  • That's why it's not good for public officials to be addicted gamblers. They take that hobby into their work and thats what happen
  • ktt

    perfect grammar and punctuations.
  • This is good to know but...what now? Do we begin prosecuting again? Can Chuuk or the FSM take it anymore? How bout we stop this wrist slapping and get serious. Yes, obviously it is more profitable to do the crime/time, and go on with life, no big deal. Take our fellow felons, J. Fritz,(is a frequent flyer now, no more immig. restrictions?), Tadashy Wainit, living big in the big HI, sucking on pineapples, Simeon Innocenti, making more millions on top of the funds he and Rooosevelt defrauded from the Chuukese people and the list goes on!Am just a crushed citizen of FSM, wondering when our leaders will sprout some brass balls and bang this job til its done!Leaves a foul taste in your mouth, y'know?
  • why thank you atenimuu, you are a SCA grad after all
  • Still listening?
    Be informed. In this information age, strive to stay informed. Corruption can never go away unless more Micronesians become more informed. Information is knowledge and therefore power. Information technology is powerful knowledge that has done wonders and is here to stay. Data gathering and tracking need be a must BEFORE, DURING and AFTER public funds are appropriated and issued to pinpoint and eliminate such ignorance.

    FSM national government need to deploy data gathering mechanisms to ensure such appropriated public funds are accounted for down to the last penny. What now congress, what now?
  • Congress continues to shame our nation and when I say Congress, I mean Chuukese Congressmen. We are so fed up with hearing negative news of Chuuk and yet, the very people who should be setting examples are the ones who are committing these shameful deeds. When can you people ever change? Aren't you sick and tired of people criticizing you? If only there is a quick way to kick you out of the FSM, I will be the first to suggest it. I mean, what more do you want? Aren't you satisfied of the outrageous salary you are getting, $60,000+ annually? This is ridiculous!!!!

    And you people of Chuuk who post so often on Micsem, why are you silent? Have you run out of skin that your flesh are now too exposed to say anything? The whole world knows about Miconesia not because of its beauty, but because of its corruption mainly due to Chuukese leaders. I bet the President won't do jack since election is coming up in a couple of years. What then, shove this under the rug like always? Jesus!!
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  • Rainbow, I agree with you. Our Chuuk Delegation including the President continue to shame the FSM. Sinsohn, if you think to the contrary, the President must prove beyond reasonable doubt that he is not part of the corruption. The President must prove his worthyness by taking the appropriate measures and deal with all the findings in the Auditor's Report. Former Vice President did it to members of his own delegation to congress. He put several of them in jail, now it is up to the President to clean up the mess and prove himself that is worthy of being the FSM President. I bet this sitting President will never take the appropriate steps available to him to correct all the wrongdoings.
  • Rainbow:

    While you may be correct that Chuuk has an ongoing problem with corruption, you are not correct in implying that these problems are limited to Chuuk alone. The same problems, although possibly not to the same degree, exist in Pohnpei, and in all probability in the other states. National Congressmen (no women yet!) all interfere with the proper disposition of national funds appropriated for their states. If you don't believe me, take the time to read the report of the Office of the National Public Auditor on Pohnpei's use of national funds.

    Here is the URL: http://www.fsmopa.fm/files/onpa/2008/CFSM%20Pohnpei_0507.pdf
  • Sarem Chuuk,

    thanks for the URL, I did a 5 minute skim through and what I was able to gather was that even though there are some irregularities I find them to be minimal. Most of the the irregularities stem from salary to employees, at one point an allotee was the contractor(this being Pohnpei Transportation Authority), an entity of the State Government. Two travels,one to saipan and one to hawaii paid by ED2, few missing cell phones, project money paying of a car here and some boats there, etc. All in all, I did not find anything which suggests that the Pohnpei Congressmen pocket any money personally out of the funds, but I may be wrong. Like I said, I only skim thru the thing and I will read the entire audit report by tomorrow morning. Believe me you, I will come hard on any Pohnpei Congressman I find to be corrupt. thanks for the report and I will see you tomorrow
  • By the way, is there a possibility to share all the States audit report? URL will do, thanks
  • Jericko:

    You did more than I did. I just looked at the summary of the audit. From what I read, it appears that there were problems with road contracts, and with Pohnpei senators controlling the disposition of public works project money, thus interfering with the separation of powers of the branches of the government (the legislature appropriates, the executive spends - in this case, and in Chuuk's case, the legislature did both by designating the projects intended to receive the money).

    By the way, in Jack Fritz' case at least, Mr. Fritz did NOT personally profit from his wrongdoing. As I understand it, neither did John Petewon or James Fritz. What they did was direct national money to constitutents who supported them, in effect buying future votes. The money intended for public works was instead spent for other purposes by those who received it, and Jack and James Fritz, at least, facilitated that.

    Simeone Innocenti, on the other hand, used money intended for medical referrals for his constituents to pay his own personal medical bills in Hawai'i. That was outright theft, in my view.

    Anybody who wants access to every public audit conducted by the Office of the National Public Auditor can find them at the website for the ONPA, at .

    An informed populace is the first step to open and accountable government.
  • theft is theft

    they are criminals!

    there is no "at least". they stole from thousands of people! They should "at least" go to prison.

    what was the sentence for these thieves? Who was the judge who tried their cases? an accomplice i presume.
  • our judicial system is not doing its job.

    Why aren't these purse snatchers sitting in a puddle of piss behind corroding bars and concrete.

    that should show them the inadequacy of their "leadership". Our prisons don't have $ to direct $#!+
    and urine out of deteriorating cells.
  • I hate it when people say, "these are people's fathers, we can't do that to them."

    Well, these guys stole from my actual father, my mother, my grandparents, myself, and my children and my brothers and sisters, cousins, uncles
    friends, acquaintances....

    because of these @$$#0LE$ thousands of us are fleeing our homes so we can feed ourselves and our children. We have to
    face discrimination, racial disparages and lost identities in a foreign land. For what?

    These people don't deserve the scraps from my floss. They should "at least" at the VERY least apologize to all of us publicly.
    They feel no shame, walking tall among people they stole from.

    their families are enjoying opportunities stolen from our families.

    someone please put these parasites away.
  • Sarem Chuuk,

    I read the entire report and I take every word I said back. OUTRAGEOUSLY SHOCKING!! Pohnpei State Congressmen are not as clean as I thought
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