Gonzales: PNM ordered WASA audit Padarath now cites

AKASH SAMA­ROO

Lead Ed­i­tor – Pol­i­tics

For­mer Pub­lic Util­i­ties Min­is­ter Mar­vin Gon­za­les says the Ernst & Young re­port be­ing used by his suc­ces­sor, Bar­ry Padarath, to ques­tion trans­ac­tions at the Wa­ter and Sew­er­age Au­thor­i­ty (WASA) was com­mis­sioned un­der the pre­vi­ous Peo­ple's Na­tion­al Move­ment (PNM) ad­min­is­tra­tion to in­ves­ti­gate sus­pect­ed ir­reg­u­lar­i­ties be­fore out­stand­ing in­voic­es were paid.

Gon­za­les made the state­ment at an Op­po­si­tion press con­fer­ence at the Red House on Mon­day, hours af­ter Padarath cit­ed the re­port dur­ing his con­tri­bu­tion to the 2027 Bud­get de­bate, rais­ing ques­tions about trans­ac­tions in­volv­ing wa­ter truck­ing con­trac­tor Flex­i­ble En­ter­pris­es Lim­it­ed.

The Arou­ca/Lopinot MP ac­cused Padarath of try­ing to score po­lit­i­cal points with an in­ves­ti­ga­tion ini­ti­at­ed by the for­mer ad­min­is­tra­tion.

"That Ernst & Young re­port was com­mis­sioned by the for­mer Min­is­ter of Pub­lic Util­i­ties, the Ho­n­ourable Mar­vin Gon­za­les," he said.

Gon­za­les said the au­dit was or­dered af­ter con­cerns emerged about ques­tion­able in­voic­es, weak in­ter­nal con­trols and al­leged wa­ter truck­ing rack­ets at WASA.

He said one con­trac­tor was owed ap­prox­i­mate­ly $78 mil­lion, prompt­ing him to in­struct WASA's board to au­dit the in­voic­es be­fore set­tling the out­stand­ing pay­ments.

"The Board of WASA, un­der the guid­ance of Ravi Nan­ga, Se­nior Coun­sel, com­mis­sioned Ernst & Young to do an in­ves­ti­ga­tion, ex­am­ine the in­voic­es, ex­am­ine the doc­u­ments be­fore set­tling any out­stand­ing ar­rears," he said.

Gon­za­les ques­tioned why Padarath would use the re­port to sug­gest wrong­do­ing with­out ac­knowl­edg­ing that the pre­vi­ous ad­min­is­tra­tion had com­mis­sioned the in­ves­ti­ga­tion.

He al­so re­ject­ed sug­ges­tions that Flex­i­ble En­ter­pris­es was a PNM-linked con­trac­tor, say­ing the com­pa­ny had done busi­ness with WASA for more than 50 years un­der suc­ces­sive ad­min­is­tra­tions.

"If Flex­i­ble is a PNM con­trac­tor, why would the PNM gov­ern­ment and why would a PNM min­is­ter com­mis­sion an au­dit re­port to de­ter­mine whether or not these in­voic­es are gen­uine in­voic­es?" he asked.

Padarath told Par­lia­ment that the Ernst & Young re­view iden­ti­fied ap­prox­i­mate­ly $11.4 mil­lion in ir­reg­u­lar­i­ties and 450 un­sup­port­ed in­voic­es val­ued at $30.1 mil­lion in­volv­ing Flex­i­ble En­ter­pris­es.

In­tegri­ty Com­mis­sion in­ves­ti­ga­tion

Gon­za­les al­so chal­lenged Padarath's state­ments about a con­tro­ver­sial wa­ter con­nec­tion for Nu­tramix Hatch­eries, where the es­ti­mat­ed in­stal­la­tion cost re­port­ed­ly fell from more than $500,000 to ap­prox­i­mate­ly $2,000.

He said the mat­ter arose in 2017, be­fore he be­came Pub­lic Util­i­ties Min­is­ter.

"This mat­ter arose in 2017. I was not the Min­is­ter of Pub­lic Util­i­ties in 2017," he said.

Gon­za­les cit­ed cor­re­spon­dence he said was is­sued by the In­tegri­ty Com­mis­sion on April 19, 2023, in­di­cat­ing that its in­ves­ti­ga­tion in­to the trans­ac­tion had been ter­mi­nat­ed.

Ac­cord­ing to Gon­za­les's ac­count of the cor­re­spon­dence, the Com­mis­sion found rea­son­able grounds to ex­am­ine the ap­proval of the cap­i­tal ex­pen­di­ture and con­sid­ered that a pos­si­ble breach of the code of con­duct may have oc­curred.

How­ev­er, he said the Com­mis­sion could not pro­ceed be­cause the de­ci­sion fell with­in WASA man­age­ment's del­e­gat­ed au­thor­i­ty rather than the au­thor­i­ty of its board.

Gon­za­les ac­cused Padarath of mis­lead­ing Par­lia­ment by sug­gest­ing the in­ves­ti­ga­tion re­mained ac­tive and said the Op­po­si­tion would con­sid­er re­fer­ring the min­is­ter to Par­lia­ment's Priv­i­leges Com­mit­tee.

He al­so claimed he had re­ceived in­for­ma­tion that Nu­tramix ob­tained its wa­ter con­nec­tion on­ly af­ter the Unit­ed Na­tion­al Con­gress (UNC) as­sumed of­fice in 2025. That claim has not been in­de­pen­dent­ly ver­i­fied.

Wa­ter truck­ing al­le­ga­tions

Gon­za­les al­so ques­tioned arrange­ments in­volv­ing the Gov­ern­ment's new wa­ter tank farms, al­leg­ing that con­trac­tors were be­ing paid to trans­port wa­ter in­to stor­age tanks and then paid again to dis­trib­ute the same wa­ter to con­sumers.

He ques­tioned pay­ments re­port­ed­ly reach­ing $1,200 per truck­load and called on Padarath to ex­plain arrange­ments in­volv­ing D&D Au­tos and the Jag­gerssar Group of Com­pa­nies.

"What is your re­la­tion­ship with D&D Au­tos and Jag­gerssar Group of com­pa­nies that are earn­ing mil­lions of dol­lars un­der wa­ter truck­ing ac­tiv­i­ties in­side of WASA?" he asked.

Gon­za­les said the ap­prox­i­mate­ly $30 mil­lion in­crease in WASA's wa­ter truck­ing al­lo­ca­tion for fis­cal 2027 war­rant­ed clos­er scruti­ny.

He main­tained that his ad­min­is­tra­tion had tak­en steps to tack­le il­le­gal wa­ter truck­ing op­er­a­tions and ac­cused Padarath of fail­ing to ad­dress his con­cerns.

Gon­za­les al­so launched per­son­al at­tacks against Padarath, re­peat­ed­ly call­ing him a "po­lit­i­cal pee­wat" and ac­cus­ing him of try­ing to dam­age his po­lit­i­cal ca­reer.

"He has a pas­sion to be scan­dalous and to be scan­dalous for no rea­son," he said.

"He came and made a pub­lic fool of him­self."