Keywords: fraud invoice fraud, electronic invoicing, einvoicing, e-invoicing, Maldives, F-Tech Solutions, Anti-Corruption Commission

Government defrauded by doctored invoices

Susie West | News | 4 May 2012

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An audit report claims the government of the Maldives was defrauded out of Rf11.8m (£470,000) by a local company that was signed up to provide laboratory equipment for regional hospitals.

It is alleged that only Rf930,512 of consumables and apparatus had been delivered by F-Tech Solutions Pvt. Ltd when company officials started to doctor invoices and delivery notes to obtain further payments, according to Minivan News.

Fraud could have been avoided at several stages in the process, the report suggests. Not only was the contract awarded to F-Tech Solutions against the advice of the Anti-Corruption Commission, but the company had no previous experience in supplying medical equipment.

Furthermore, the state minister for finance is alleged to have allowed finance ministry staff to sign off delivery notes instead of health officials.

"This office notes that F-Tech Solutions forged signatures on some delivery notes and invoices," the report explained. "Further, the health ministry, hospitals and health centres have not received any of the goods said to have been delivered on the delivery notes.

"While the health ministry's supply department has received goods noted on one invoice, the prices noted on the invoice are extraordinarily higher than prices pledged in the contract document."

Two of the 21 delivery notes are thought to have been signed by a staff member who does not exist, while a further nine may have a forged signature of one procurement officer.

Following the allegations, the government could look at the benefits of e-invoicing to make sure its tendering and payment process is secure. As well as being more efficient and time-saving, e-invoicing ensures that any problems are flagged up earlier in the process while also eliminating the potential for paper fraud.

Auditor General Niyaz Ibrahim, who wrote the report into this case, has recommended fraud charges against F-Tech Solutions and government officials thought to be involved. Police were informed in the middle of April and are now investigating the case.