Court fines ex-Inland Revenue cashier for misappropriating $1.5m

A supervisor with the Inland Revenue Division (IRD) of the Ministry of Finance was on Tuesday fined $600,000 by a High Court judge for the misappropriation of $1.49 million in tax revenue payments\

In 2021, Lystra Irving, from Chaguanas was charged with misbehaviour in public office and 13 counts of money laundering by acting ASP Cornelius Samuel of the Fraud Squad.

She entered a plea agreement with the Office of the Director of Public Prosecutions at the magistrates’ court and the matter was sent to the High Court by the chief magistrate on May 25.

On Tuesday, she was fined by Justice Gail Gonzales who accepted the plea agreement and sentenced her on the terms set out which recommended a non-custodial sentence and the payment of restitution to the State.

Irving was fined $300,000 for misbehaviour in public office and another $300,000 to cover the 13 money laundering charges. A payment plan of $5,000 a month for 120 months was approved by the judge. If she fails to pay, she will serve prison time as both fines carry a six-year default penalty.

In January 2021, senior auditors at the IRD detected several discrepancies with the accounting entries made by a senior public officer and realised that a certain amount of tax revenue received from the public could not be accounted for.

A report on the discrepancies was made to the Fraud Squad in February 2021. Irving was arrested on December 1, 2021.

The 12-page statement of agreed facts, which formed part of the plea deal agreement in the magistrates’ court, said Irving was rostered to the checking/deposit/banking operations at the IRD from March 1, 2020-February 1, 2021, as an acting accounting assistant at the cashier’s unit. Her role involved depositing cash and cheques to Central Bank.

In October 2020, discrepancies were first discovered during reconciliation exercises – which involves reconciling the tax collected daily from the public by IRD’s cashiers against the amounts deposited to the Treasury Division – for the months of March 2020-July 2020.

The discrepancies detected were shortages in the business levy tax payments and one discrepancy in the green levy tax payment.

More discrepancies were discovered for August-September 2020, during an examination of treasury deposit vouchers. The amounts deposited in the Treasury were less than the amounts recorded on the GenTax software platform reports, the evidence showed.

It was also discovered that the errors originated at the IRD and investigations revealed that the tax revenue totalling $1.49 million, which should have been deposited in the Central Bank, was unaccounted for.

The police were then contacted. During the course of the year-long forensic investigation by ASP Samuel, he obtained production orders for Central Bank to produce the slips showing cash depositions made by the IRD for March 1, 2020-February 1, 2021.

Investigators compared the reports from the GenTax system with the slips from Central Bank and found 56 discrepancies which showed that the sums of money deposited in the Treasury Division from March 26, 2020-January 15, 2021, was considerably less than the sum of money collected by the IRD.

The total amount of the shortfall in deposits amounted to $1,498,000.

According to the statement of offence on each of the money laundering counts, Irving made 13 deposits of cash, ranging from $20,000 to $35,000 between July 13, 2020- January 18, 2021, to her personal bank account.

At the High Court, attorney Kaleem Hosein, who represented the IRD, told the court of the embarrassing effect the serious and disappoointing breach had on the division.

However, he assured that procedures have been updated internally to prevent a re-occurrence.

Irving’s attorney Renuka Rambhajan thanked the judge for the swift dispensation of justice in the case and the judge, the prosecution and defence commended Samuel for the thoroughness of his investigation.

Irving's employment with the public service is expected to be addressed by the service commission department.