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Odysseus report for the Ministry of Foreign Affairs: Illegal payment of rent allowance to a diplomat – 45,000 euros…

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 Eκθεση Οδυσσα γ ιαΥΕΞ: Παρνομη κατβολor επιδ μοσκοδιλ–ε ;ρo...

“As a Service we consider the case very serious since it seems to be related to offenses of abuse of power and/or covering up phenomena of abuse of power and/or waste of public money”.

The Report of the Audit Service for the Ministry of Foreign Affairs (2019-2021) made public today refers to the illegal payment of an allowance by the Ministry of Foreign Affairs, rent amounting to €45,000, between the years 2018-2021, to a diplomat who served in a diplomatic mission abroad. The diplomat in question –the “Citizen” wrote on the subject last May– during the application for rent allowance that he submitted, he hid the fact that he lived in an apartment that is owned by a company that belongs 70/75 to him and 5/75 to his partner. The ministry refused to take steps to recover the amount. He also refused to even investigate the possibility of disciplinary offences. In detail, the EY Report for the Ministry of Foreign Affairs states the following:

Payment of rent allowance to a diplomat

According to a complaint received by our Service regarding the above matter, the Diplomat in question, between the years 2018 and 2021, when he served in an Embassy of the Republic in an EU country, was paid a rent allowance by the Ministry of Foreign Affairs, while he lived in an apartment which is owned by a company owned 70/75 by him and 5/75 by his partner. From the investigation of the matter, on the basis of the information submitted to us with the complaint, the validity of the complaint has been confirmed and that the Diplomat in question received a total of €45,000 as rent allowance for the period 15.9.2018 – 23.9.2021 .

Also based on the complaint, the Ambassador of the Republic at the aforementioned Embassy approved the second application for rent allowance – submitted for the same apartment, due to the application of a new Foreign Rent Allowance Scheme effective from 1.1.2021 – while he knew about the property apartment, however we have not been able to confirm the validity of this aspect of the complaint. As a Service we consider the case very serious since it seems to be related to offenses of abuse of power and/or covering up phenomena of abuse of power and/or waste of public money.

It was requested by the Ministry of Foreign Affairs through our relevant letter dated 21.4.2023 to state his own position before we refer the case to the Independent Anti-Corruption Authority. The DG of Foreign Affairs in a letter dated 3.7.2023 informed us of the following:

a. Following an investigation by the Financial Crimes Prosecution Sub-Directorate of the Police Headquarters into the complaint about the possible commission of criminal offenses by the said Diplomat, related to financing and misappropriation of public money, the Ministry of Foreign Affairs was informed by a relevant letter from the Anti-Crime Department dated 20.9.2022 that the file of the case was sent to the Legal Service (NY) for study and instructions and was subsequently returned and archived as the NY found that there is no evidence of the commission of any criminal offense by any person.

b. In spite of the fact that the NY found that, possibly, disciplinary offenses have been committed, the Competent Authority decided not to proceed with a disciplinary investigation since the complaint in question had previously been investigated in the context of the criminal investigation, which did not document the commission of a criminal offense for this issue.

c. After the decision of the Ministry of Foreign Affairs, the provisions of the Rent Allowance Scheme were discussed with the Ministry of Foreign Affairs, and in particular the fact that it does not include any relevant reference/provision in the event that an employee has a privately owned apartment or house (which is the property of a company that belongs to the employee as in this case case) in the country/city where the DA is based. The fact that the Rent Allowance Scheme does not expressly state that it is prohibited to pay it in such a case and despite the fact that this is what is applied in practice given that the term “rent” refers to an amount of money that one pays for the right to temporarily use a place for living , however, as it has emerged, it leaves a legal leeway (“window”) of different interpretation for this, among other things, and the NY decision concluded that no criminal offense was committed.

d. The Ministry of Foreign Affairs intends to immediately examine this weakness of the Rent Allowance Scheme (as found during the criminal investigation) so as to leave no room for future misinterpretation/exploitation by anyone. For this purpose, a relevant letter will be sent to the YO, which is jointly responsible for the preparation/possible amendment of the Rent Allowance Plan.

e. With regard to the complaint which referred to the approval by the Ambassador of the Republic of Korea of ​​the second rent allowance application of the said Diplomat submitted for the same apartment while he was aware of his ownership, the Ministry of Foreign Affairs was not aware of this aspect of the complaint.

On 10.7.2023, we again sent a letter to the Minister of Foreign Affairs noting the following:

  1. Based on information we have secured during the investigation of matter, it appears that the Diplomat in question, in the Requests for Rent Allowance provided for by the Plan that he submitted and signed on 11.9.2018 and 24.12.2020, falsely declared NO in point 2 (f) “Is he related to the owner (YES/NO )”.
  2. Based on article 78 of the Law on Public Service, “an employee who was prosecuted for a criminal offense and was found not guilty cannot be prosecuted for the same charge but can be prosecuted for a disciplinary offense resulting from his conduct, which is related to the criminal case, but does not raise the same issue as that of the charge in the criminal prosecution”. In this case, there was no criminal prosecution and acquittal of the Diplomat in question and therefore it is obvious that this Diplomat should have been disciplined for the fact that he signed a false statement with which he obtained an amount of €45,000 from the state.< /li>
  3. In a note dated 11.10.2006 of the former Attorney General to the YS it was explained that, if a complaint is submitted to the competent authority that a specific civil servant may have committed a disciplinary offense, then the competent authority must immediately arrange for a disciplinary investigation to be conducted. We are therefore of the opinion that the decision of the then Minister of Foreign Affairs not to proceed with any disciplinary investigation of the matter constitutes a failure on his part to act as required by law, besides of course the fact that our Service considers, for reasons of principle, unacceptable to cover up any disciplinary actions responsibilities of employees.
  4. Exercising our constitutional powers to control the payments made by the Republic, we consider it obvious that the sum of €45,000 collected by the Diplomat in question was illegally paid to him. Based on the Law on Accounting and Financial Management and Financial Control of the Republic (L.38(I)/2014), the responsibility for the recovery of the illegally paid amount rests with the Directorate General of Foreign Affairs, as the Audit Officer of the relevant fund. Also based on article 12(g) of the Law on Fiscal Responsibility and the Fiscal Framework (L.20(I)/2014), the Minister (head of economic operator) has the responsibility of supervising the Controlling Officer of the Ministry of Foreign Affairs.
  5. With regard to the part of the complaint concerning whether the then Ambassador of the Republic approved the second application for rent allowance – submitted for the same apartment, due to the application of a new Foreign Rent Allowance Scheme effective from 1.1.2021 – while he knew about the property of the apartment, we take it for granted that, since a police investigation has been carried out, any evidence relating to this aspect will have been identified by the Police. We therefore expect the Ministry of Foreign Affairs to request relevant information from the Police so that, if indeed there are incriminating evidence, these will form the basis of a disciplinary investigation against the then Ambassador of the Republic.

    In a letter dated 15.1.2024, the Directorate General of Foreign Affairs informed us that an opinion was requested from the Attorney General of the Republic of Macedonia regarding the issues raised above. In particular, in the reply letter dated 24.11.2023 the Attorney General reported the following:

The Ministry of Foreign Affairs is not authorized to recover the amount of €45,000 that the official received as rent allowance

¨ Pursuant to Article 81(2) of the Public Service Law, the authority to initiate any disciplinary investigation is vested and/or vested in the respective competent authority, i.e. the Minister of Foreign Affairs, who, in the framework of his discretion, will decide whether it is appropriate conducting such an investigation. In the same letter, the Ministry of Foreign Affairs informed us that in the meantime the Ambassador has retired and therefore the possibility of a disciplinary investigation against him cannot be considered, in accordance with article 76 of the Public Service Law.

With our letter dated 29.1.2024 we informed the Minister of Foreign Affairs of the following:

a. The Diplomat, in the Requests for Rent Allowance provided for by the Plan that he submitted and signed on 11.9.2018 and 24.12.2020, falsely stated NO in point 2 (f) “Is he related to the owner (YES/NO)”. Since the Police investigated the case, we take it for granted that they found these two false statements.

The Attorney General of the Republic, exercising his constitutionally unrestricted authority to prosecute, or not, any person, decided that, despite the existence of these two false statements, the commission of any criminal offense by any person is not established. We note that our Service does not have the authority to exercise control over the manner in which the Attorney General exercises his own constitutional powers.

b. The Attorney General made an opinion that disciplinary offenses may have been committed, but the former Minister, acting as the competent authority based on the Public Service Law, decided not to proceed with a disciplinary investigation on the grounds that the criminal investigation did not establish the commission of a criminal offense offence.

With our identical letter dated 10.7.2023, as we mention in point (ii) above, we indicated to the current Minister that, based on article 78 of the Law on Public Service, “an employee who was prosecuted for a criminal offense and was not found guilty cannot be disciplinary prosecuted for the but the same charge may be prosecuted for a disciplinary offense arising out of his conduct, which is related to the criminal case, but does not raise the same issue as that of the charge in the criminal prosecution”. In the present case, there was no criminal prosecution and acquittal of the Diplomat and therefore it is obvious that he should have been disciplinary prosecuted for the fact that he signed a false statement by which he obtained an amount of €45,000 from the state, but also for other derivations disciplinary matters, such as for example that he entered into a contract with a company in which he has an interest (in violation of Article 60(2)(b) of Law 1/1990), that he held shares in a company without the permission of the Minister of Finance (in violation of Article 65 of the same Law), etc.

We pointed out that the aforementioned opinion of the former Attorney General dated 11.10.2006 which explained the obligation of the competent authority to investigate disciplinary offenses was also adopted by the former Attorney General in a number of his opinions.

We indicated that the Minister did not comment in his last letter regarding aspect concerning possible disciplinary offences, indicating his decision to investigate the matter non-disciplinaryly.

c. We have noted the overturning of the above timeless position of the NY by the current Attorney General who, in his present opinion, expresses the position that the competent authority (the Minister) has the discretion to decide whether it is appropriate not to conduct such an investigation. Whereas article 81(2) of the Law on Public Service (L.1/1990) explicitly states that if a complaint is made to the competent authority or it comes to its attention that a civil servant may have committed a disciplinary offence, the competent authority must immediately take care as a disciplinary investigation is conducted, the current Attorney General expresses the position that the competent authority may decide not to proceed with any investigation.

We have indicated how important we consider the fact that, even if the position of the current Attorney General at the Minister's discretion, he chose to exercise that discretion in a way that prevented the accountability of that official.

d. The opinion of the Attorney General states that the Diplomat “concealed that the apartment in question is owned by his interests for obvious reasons”. We understand that the phrase “for obvious reasons” implies that, if he did not conceal this fact, he would not be granted the rent allowance.

Then, because, as is well known, the company, as a legal entity, is not identified with its shareholders, the Attorney General expresses the position that “no relation of kinship is considered to exist between the company as a legal entity and its shareholders”. This position alienates us. The fact that the company is not identified with its shareholders, in no way means that they have no relationship between them.

This reasoning of the Attorney General also led him to the conclusion that the Diplomat's statement “NO”, to the question “Is related to owner(YES/NO)”, is true.

The Attorney General continues explaining his position that, since the existence of a criminal offense was not established, such as e.g. conspiracy to extort or secure money by false representation, and since, according to him, the rent allowance was lawfully received, he does not find any cause of action on the particular facts of the case. Also included in the reasoning of the Attorney General is the reference that the Diplomat “would be entitled to a rent allowance anyway”, we take it to mean that, even if the flat was his own, the State would still have to pay him a “rent” allowance since could theoretically decide to stay in another apartment.

In addition to the above, we note the following:

  1. In the Criminal Code (Cap. 154 ) there are two offenses relevant to this case relating to false representations or false claims and both of which contain the element of fraud as an element:

False claims by public officials

104. Public officer, in whose official duties is reduced the obligation or the ability to give accounts or statements in relation to any sum of money which must be paid or which he claims must be paid to him or another or in relation to any other matter requiring certification for the purpose of paying or delivering goods to any person, who issues an account or statement on such matter, which it knows to be materially false, is guilty of a misdemeanor and liable to imprisonment for three years and a fine.

Definition of false representations

297. A false representation is any representation of fact, past or present, by word, document, or conduct, which is false in fact and which the person making the representation knows to be false or does not believe to be true.

< p>As we have mentioned above, the Attorney General of the Republic, exercising his constitutionally unrestricted power to prosecute any person, decided that the commission of any criminal offense by any person is not established. Since, our Service has not authority to exercise control over the manner in which the Attorney General exercises his own constitutional powers, we do not comment on this decision of the Attorney General.

  1. Contrary to the above provision of the Criminal Code, in the Law on Contracts (Chapter 149) the term “False representation”, which could be the basis for claiming the amount and deducting it from the Diplomat's salary, does not include component of the element of fraud and includes:
  2. affirming in a manner not justified by the information of the person attesting, an untrue fact, even though the person attesting believes it to be true,
  3. < li>any breach of duty, which, without intent to defraud, confers a benefit on the offender or on any one who claims through him, by misleading another to his detriment or to the detriment of anyone who claims through him,

  4. the provocation, even without cause, a mistake as to the substance of the object of the agreement on part of it.

e. Based on the above, exercising our constitutional powers to control the payments made by the Republic, we consider it obvious that the sum of €45,000 collected by the Diplomat was illegally paid to him, and therefore we remain of the opinion that, based on the Law on Accounting and Financial Management and Financial Control of the Republic (L.38(I)/2014), the responsibility for the recovery of the illegally paid amount rests with the DG of the Ministry, as the Audit Officer of the relevant fund. We also reminded that, based on article 12(g) of the Fiscal Responsibility and Fiscal Framework Law (L.20(I)/2014), the Minister (head of economic operator) has the responsibility of supervising the Controlling Officer of the Ministry of .

Source: politis.com.cy

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