The Comptroller of Puerto Rico issues a favorable opinion on the change orders related to the rehabilitation project of the Performing Arts Center of San Sebastián. However, the Report issues a comment on a situation significant to the operation of the entity.
Our auditors identified that the contractor to whom the bid was awarded for $805,000 and who was approved eight change orders for $206,420 for the rehabilitation of the Performing Arts Center, falsified the Municipality's acceptance letter regarding the completion of the project and its final cost of $1,011,420. This letter is part of the process the contractor carries out to collect the 10% that the Municipality withholds at the start of the project. The contractor did not deliver to the insurer the acceptance letter prepared by the Municipality but rather another that did not include the final cost of the project.
In addition, the contractor presented to the Municipality a bond change endorsement for $206,420 falsified with the seal of the insurance company. The contractor could not bill or collect the 10% withheld from the payments because it had not paid the increase in the bond premiums to the insurance company.
This situation was referred to the Secretary of Justice on January 29, 2018, for the corresponding action.
The Report covers the period from January 1, 2013, to December 31, 2015.
See Audit Report M-18-36.
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