The Office of the Comptroller of Puerto Rico published the result of the investigation of a complaint about the purchases made by the Municipality of Añasco from a supplier of printing materials.
The investigation revealed the appearance of competition among four companies related by family or economic ties, with the objective of bidding in a coordinated manner, to feign competition among themselves. From 2014 to 2016, the Municipality issued and paid 29 purchase orders for $97,443 in favor of company A. In 27 of them, quotes from companies A, B, C, and D were considered.
The representatives of company A were the father and aunt of the owner of company C. The owner of company B was a former employee of company C. The owner of company D performed printing repair work for company A. For the period investigated, company A paid $49,151 to company C for payroll, $7,087 to company D for equipment repairs and maintenance, and $800 to company B for professional services.
These situations were referred to the Department of Justice, to the Office of Monopolistic Affairs of the Department of Justice, to the Federal Prosecutor's Office, and to the Federal Bureau of Investigation on August 30, 2019. At present, these situations are pending resolution.
The mentioned suppliers engaged in anticompetitive agreement practices with the intention of defrauding the Municipality and the treasury. The commented situation caused the false appearance of competition among suppliers, which deprived the Municipality of having several alternatives at its disposal. In addition, the crimes of fraud, conspiracy, and undue interference in governmental operations, among others, could be configured.
The Special Report also notes that the Municipality ordered seven purchases in favor of company A for $32,160 without issuing the purchase orders. These were recorded up to six months after receiving the goods, which prevents maintaining effective control of the purchasing budget and can lead to overdrafts in the expense items.
Contrary to the laws and regulations in force, the suppliers' quotes included with the disbursement vouchers examined did not have the name, title, or signature of the municipal official or employee who processed them. This situation makes it difficult to detect possible irregularities in time to fix responsibilities on the officials or employees who intervene in these processes.
The investigation recommends that the Office of Management and Budget ensure that the Municipality of Añasco complies with the Corrective Action Plan established by the Office of the Comptroller of Puerto Rico.
The Special Report covers the period from July 1, 2013 to June 30, 2017.
See Audit Report M-21-17.
To see other published reports, visit our Audit Reports section.
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