THE COURT REPORT

Marape Removed NHEL Management Now He Should Investigate Them

In late 2017 James Marape MP, along with John Kaupa MP, made the decision as trustee shareholders to close down the National Housing Estate Limited (NHEL), and terminate its senior management, including CEO Kevin Ahipum.

NHEL had been set up by the national government as a real-estate arm of the National Housing Corporation (the National Housing Corporation is a statutory body responsible for building and maintaining public housing stock). NHEL was to operate on a commercial orientation, and take hold of many NHC properties.

For years it operated under a blanket of fiscal secrecy, while allegations reverberated around on impropriety within.

PNGi raised the alarm about various irregular dealsNHEL was a party to.

Then last week a new NHEL case came across PNGi’s desk – B3 Hire Cars v Ahipum [2019] PGNC 163.

According to Judge Dingake on or about 29 February 2016, the Executive Chairman of NHEL, Mr Kevin Ahipum, entered into a Loan Agreement with B3 Hire Cars on behalf of his employer, NHEL. In total B3 Hire loaned NHEL K200,000.

This in itself is a curious transaction. Why would NHEL, a state owned company presumably with a decent property portfolio, seek finance from a small hire car business rather than say a bank?

B3 Hire alleges that NHEL then broke the loan agreement, and as a result B3 Hire obtained default judgement against NHEL on 26 April 2018, shortly after orders were given by Marape and Kaupa to terminate senior managers and wind up the company.

NHEL is now contesting this default judgement, arguing its former Executive Chairman Mr Ahipum had no right to enter into this loan agreement.

Judge Dingake confirms ‘there is no evidence suggesting that the first defendant [Mr Ahipum] was authorized to procure the loan in the amount of K200,000.00 from the plaintiff [B3 Hire Cars] on behalf of the second defendant [NHEL]’.

But this isnt where the story ends.

The business name B3 Hire Cars was registered on 1 December 2015 and belongs to Ms Saundrang Manuai. It appears in the space of three months this hire car business accumulated enough capital to be make a K200,000 loans to NHEL.

What is even more remarkable about this is that B3 Hire Cars’ owner Ms Sau Manuai lists her occupation as personal assistant at NHEL.

How many young people, several years out of university, working as a personal assistant, have a spare K200,000 to loan to their employer?

So Mr Ahipum, it is alleged by NHEL, had no right to enter into this K200,000 loan agreement with a business owned by NHEL personal assistant, Sau Manuai, which then mysteriously NHEL breached and default judgement was obtained.

Probably the biggest question for Ms Manuai and Mr Ahipum to answer  is whether there was ever a transfer of K200,000 to NHEL from Ms Manuai? And if there was how on earth did this young personal assistant get her hands on this volume of money?

The risk, in this instance, is that K200,000 was never actually transferred to NHEL. The loan agreement was potentially a sham, no money was loaned, but NHEL would pay back the ‘ghost loan’ with interest to B3 Hire Car. Then when Prime Minister Marape in his previous role as Finance Minister gave orders to wind up NHEL, those involved in this potential sham quickly sort a default judgement before NHEL went under, so that K200,000 could be transferred from NHEL accounts, to B3 Hires’ account, where it could be shared out among co-conspirators – presumably current or former NHEL management.

Lets be clear PNGi has no evidence to suggest this is what actually took place, and is not alleging this is what happened. But clearly in these highly irregular circumstances this is one line of inquiry the government ought to consider.

Prime Minister Marape put an end to this opaque entity, it would now seem an opportune time for the police to investigate its former management and staff.