A COMPLAINT letter addressed to the Police Commissioner David Manning by former Central Bank Acting Governor Benny Popoitai referring Puma Energy (PNG) to police for investigations over allegations of suspected of money laundering has surfaced.
The copy of the letter obtained by the Sunday Bulletin Newspaper addressed to COP and attention to Assistant Commissioner of Police (ACP) Hodges Ette was dated 11th January 2023 (a year ago).
It read, “Suspected money laundering offences under the Criminal Code Act Chapter 262 and criminal offences under the Central Banking Act 2000 committed by Puma Energy (PNG) Refining Limited (NGR), Puma Energy (PNG) Limited (NGE) and their related entities (Puma Goup), including the shareholders and directors of the PNG and foreign registered entities.
“I write to formally lay a complaint against the above entities, their Directors and associated individuals for suspected money laundering offences committed against the laws of the country especially the Central Banking Act 2000 and Criminal Code Act Chapter 262.
This newspaper also obtained a copy of the affidavit dated 15 November 2022 and filed in Court on 16 November 2022.
The affidavit was prepared in support of an application for a restraining order against PUMA Group, in civil proceedings named OS No 228 of2022 Bank of Papua New Guinea v PUMA Energy PNG Refining Limited.
In summary, the Bank of Papua New Guinea alleged against the PUMA Group:
That PUMA Group through its PNG-registered entities namely NGR and NGE, and its overseas-registered entities namely Puma Energy PNG Supply Ltd (NGS), Trafigura Pte Ltd, Puma Energy Supply and Trading Pte (SAP) and Pinna International Finance (PIF) breached several conditions of a Foreign Currency Account (FCA) authority granted by BPNG to NGR on 10 May 2017.
The conditions that were allegedly breached were:
- That “NGR will use the FCA to receive foreign currency receipts from the export of refined crude oil by-products and also to make payment for goods and services abroad”; and;
• That credits to the FCA of funds from other sources are not permitted. However, from November 2021 to 13 July 2022, PUMA breached these conditions by transferring the following amounts into the FCA without obtaining prior approval from BPNG to do so.
The act of transferring these amounts to the FCA in Singapore, without the prior written authorization of BPNG is a contravention of section 7(l)(b) and section 28(2) of the Central Banking (Foreign Exchange and Gold) Regulation 2000 (the Regulations).
The Regulations are expended upon in the Foreign Exchange Manual 2015, which sets out in detail among other things, the terms and conditions of an Authority granted under section 6 of the CBA, which covers an authority for an FCA.
That PUMA Group failed to comply with the directions of the Central Banking Act issued under section 98(1) of the CBA and hence committed offences pursuant to section 98(2) of the CBA.
The directions are namely:
• Direction issued on 20 September 2022 to repatriate approximately K921,598,000 back to PNG as these were disclosed in the NGR company’s audited financial statements for the year ended 31 December 2021 as Trade Receivables arising from proceeds of the sale of refined petroleum products by NGR to its parent company NGS, incorporated in Cayman Islands and held offshore in an unknown bank account of PUMA Group;
• Direction dated 20 September 2022 to NGR to close the approved FCA held with ANZ Bank in Singapore;
• Direction dated 26 September 2022 requiring PUMA Group to cease and refrain from making any further threats to BPNG and to maintain continued supply of refined petroleum products to any or all of its domestic customers in PNG from the date of the direction. Mr. Tokome, Director of NGR made further threats to BPNG officers and issued written notices to Air Niugini on 30 November 2022 informing them supply of Aviation fuel will cease or reduce due to PUMA Group’s PNG companies’ inability to source sufficient foreign exchange for its PNG operations. These threats and notices to Air Niugini are in contravention of the Direction and constitute a criminal offence under Section 98(b) of CBA;
• Direction issued to NGR on 26 September 2022 for the company to remit back to PNG USD173,443,779.59 and AUD80,891,477.16 being remittances made without BPNG approval to the FCA in Singapore through the three commercial banks in PNG through NGR and NGE company accounts.
Under Section 98(2) states that: a person who refuses or fails to comply with a direction given under subsection (1) is guilty of an offence.
Popotai’s letter further alleged that PUMA made false and misleading statements when it stated in its financial statements for NGR for 2021 that an amount of K921, 598,000 was for trade receivables owed by NGS, yet when directed to remit these funds back to PNG, NGR stated that it was impossible for these funds to be remitted back.
This inconsistency amounts to a false statement made by PUMA regarding its financial position and is a criminal offence under section 31 of the Regulations,” the documents read.
“Their actions were also a contravention of section 508(B) of the Criminal Code Act Chapter 262 because PUMA Group knew or ought reasonably to have known it was breaching the conditions of the FCA when it transferred the funds offshore into the FCA held with ANZ Bank in Singapore.
This is because earlier on 28 September 2021, the director of NGR requested BPNG for a “temporary change” to the relevant FCA condition. On 1 November 2021, BPNG rejected the request, meaning it did not approve it. Despite BPNG’s response, director of NGR and NGE – which entity has no such foreign exchange commitments due to its solely domestic PNG operations – went ahead and transferred the above stated significant amounts into the FCA held with ANZ Bank in Singapore.
Hence, funds were transferred in connection with and/or as a direct result of the breach of these conditions making them “criminal property” for the purpose of section 508B of the Criminal Code Act. These actions caused direct financial losses to BPNG, by way of its precious foreign exchange being fraudulently remitted overseas, which would otherwise be made available for other entities requirements in the PNG economy.
The amount of US$173,443,779.59 and A$ 80,891,477.16 and K921, 598,000 are also alleged “tainted property” which can be recovered by the Public Prosecutor through proceeds of crime proceedings.
However, BPNG would like to ask the Court to order their forfeiture or return or vesting in BPNG as part of any sentencing order after conviction,” Mr Popoitai wrote in his referral.
