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Improper Issue of Diplomatic and Official Passports [1998] VUOM 8; 1998.08 (18 March 1998)

REPUBLIC OF VANUATU

OFFICE OF THE OMBUDSMAN

PUBLIC REPORT

ON THE

IMPROPER ISSUE OF DIPLOMATIC AND OFFICIAL PASSPORTS

13 March 1998

(reissued 18 March 1998)

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TABLE OF CONTENTS

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PREAMBLE

'He that is greedy of gain troubleth his own house; but he that hateth gifts shall live' .....

Proverb 15 V 27.

Few countries have made it harder to earn a passport than Vanuatu. The requirements are strict - there must have been ten years residence in the country, and there must have been no criminal record of any kind, or no doubtful background.

It has always been difficult to understand quite why these requirements were made so demanding, since for example, Australia requires only two years residence and New Zealand three years.

However, whatever the reasons behind those requirements, they were ignored by Senior Ministers when it suited them.

This 'illegal' practice of improper issue of passports was not confined only to ordinary passports, but diplomatic and 'official' passports were granted illegally to selected persons; some of whom had a criminal, or at least a questionable past, and most of them, not any information on them, and sometimes no address.

It should be noted that these actions also put other countries involved in a very undesirable position. For example, the possession of these 'special' passports enable undesirable people to pass freely to and from some countries who would not have agreed to this if they had been asked, carrying diplomatic cases that tradition and agreements requires the customs not to open.

Therefore Vanuatu once again is put into a position, because of its leaders’ actions, of losing the respect of other nations. This report gives clear evidence of the processes involved and of the actions of leaders elected to take care of the interests of the people.

In the years since Independence in 1980, many of these leaders at different times have used words like 'pride', 'integrity' 'sovereignty' 'independent' when referring to Vanuatu’s nationhood. However these important words seem to have been forgotten.

1 FACTS AND COMMENTARY

1.1 This report concerns an improper and unreasonable practice that started in 1993 and has gathered pace since then. This is the issue of Vanuatu diplomatic and/or official passports to various foreign nationals and their spouses who have been appointed by Ministers as 'Honorary Consuls', 'Deputy Consuls', 'Trade Commissioners', 'Assistant Trade Commissioners', 'Trade Representatives' and 'Special Advisers'.

1.2 The reason that I have put these titles in quotation marks is because my view is that with only a few exceptions all these appointments are a sham. There appears to be about 30 diplomatic passports and 40 official passports that were issued to persons that were not proper appointments. Also of serious concern is that two official passports (X000246 and X000393) and one diplomatic passport, (D000174), are missing and cannot be accounted for.

1.3 The appointments of these foreign nationals to these somewhat vague posts for the purpose of developing trade and/or looking after the needs of Vanuatu citizens from countries ranging from Thailand to 'the Middle East' and even to a whole continent of Asia appears to be a convenient trick to take part in the fairly lucrative market for second passports.

1.4 Those involved were former Prime Minister Rt. Hon Serge Rialuth Vohor, former Foreign Affairs Minister Vidal Soksok, former Prime Minister Hon Maxime Carlot Korman and former Foreign Affairs Minister Hon Willie Jimmy. There was on one occasion also a diplomatic passport issued to Peter Swanson under instructions of former Finance Minister Hon Barak Sope relating to the Bank Guarantees matter.

1.5 The great majority of these appointees:

(a) have never been approved by the receiving country (this means the country to which the appointee is posted; i.e. for the Honorary Consul to Malaysia the 'receiving country' will be Malaysia) and thus are invalid and ineffective.

(b) have never done any work for Vanuatu citizens living overseas (in most cases this because there are no ni-Vanuatu living in these countries; e.g. Cambodia, Thailand, Seychelles, Nauru and Malta) or

(c) have never successfully promoted Vanuatu resulting in investment for or trade with Vanuatu;

(d) have never submitted any reports as directed to do so in their letters of appointment (where those exist).

1.6 For many of these appointees:

(a) other than their name, nothing is known about them or their background. The Department of Foreign Affairs at one point had to write to the Immigration Department asking for addresses from Immigration and Departure cards for various official and diplomatic passport holders as they did not hold even these most basic detail on their own files!

(b) they are young people without any demonstrable skills or qualifications to carry out the specialised tasks that are required of bona fide Consuls and Trade Commissioners; and

(c) they already hold or have held other foreign passports, including in a few instances Vanuatu official and/or diplomatic passports. The most recent examples are four passports issued by Foreign Affairs Minister Soksok to four men with Chinese names in late November/early December 1997 who held passports from Nauru issued about 1 week earlier. Two of these Chinese people are now Vanuatu’s 'Honorary Consuls to Nauru'; and

(d) they do not live in the country in which they are supposed to be representing Vanuatu and for a few are not even residents let alone citizens of the receiving country

1.7 In the case of a couple of these appointees:

(a) they have criminal convictions or have been alleged to have been involved in fraudulent activities (e.g. Mr Yae Yong (Richard) JUNG[1] (appointed by Messrs Serge Vohor and Soksok) and Mr Peter SWANSON[2] (appointed by Mr Barak Sope); WANG Zhi-Ying[3] (appointed by Mr Maxime Korman)

(b) they have also received citizenship and an ordinary (as distinct from diplomatic) passport as well (Mr Jian Peng CHEN (appointed by Messrs Vohor and Soksok) and Mr Yae Yong (Richard) JUNG.

1.8 Mr Jean Sese, the suspended Director of the Foreign Affairs Department, was the compliant servant of Messrs Vohor, Korman, Jimmy, Soksok and Sope in issuing these passports that should never have been issued. Most recently, when the Ombudsman’s Office started enquiring into allegations of illegal passport issues in September 1997, Mr Soksok from November 1997 has now illegally taken over responsibility for issuing diplomatic passports himself as advised to us by the Foreign Affairs Department.

1.9 Interestingly also was that after the Ombudsman’s Office started inquiring into this matter the Department of Foreign Affairs suddenly started in late 1997 seeking letters of acceptance for persons it had already given diplomatic and official passports to. This was a pointless exercise since the passports had already been handed out.

1.10 The best way to set out this information is by way of tables. Table 1 to this report is a list of diplomatic passports that on present information appear to have been improperly and/or illegally issued, with some exceptions as marked. Table 2 is a list of official passports that that on present information appear to have been improperly and/or illegally issued, with some exceptions as marked. The relevant law and practices relating to diplomatic passports is set out in the next section, section 2.

1.11 The following information is a selection of what is to be noted from the tables:

• Out of 70 passports issued only 6 have been issued with a letter of acceptance from the receiving country. 64 were issued without a letter of acceptance.
  
• Vanuatu has 8 or 9 representatives in Taiwan
  
• Vanuatu has four representatives in Singapore and two each in Nauru and the Philippines
  
• Vanuatu has ten representatives with official passports for whom no-one knows in which country they are representing Vanuatu
  
• Vanuatu has issued passports to four 'special advisers'
  
• About 20 appointments were made by Mr Korman
  
• About 19 appointments were made by Mr Jimmy (some with Mr Vohor)
  
• Eight appointments were made by Mr Vohor (some with Mr Jimmy)
  
• About nine appointments were made by Mr Soksok
  
• One appointment was made or recommended by Mr Sope
  

TABLE 1 - DIPLOMATIC PASSPORTS ISSUED

KEY

** = Letter of acceptance held by receiving country

¶ = Passport now in Department of Foreign Affairs’ custody

TABLE 2 - OFFICIAL PASSPORTS ISSUED

KEY

** = Letter of acceptance held from receiving country

¶ = Passport now in Department of Foreign Affairs’ custody

2 LEGAL BASIS FOR THE ISSUE OF DIPLOMATIC AND OFFICIAL PASSPORTS

2.1 S 2 of the Diplomatic and Official Passports [Cap 179] states:

(1) Subject to the provisions of this Act, an officer authorised in that behalf by the Minister may issue Vanuatu diplomatic and official passports.

(2) Diplomatic and official passports shall be issued in the name of the Minister responsible for the foreign affairs of the Republic of Vanuatu and shall be in such forms as are prescribed by the Minister.

(3) No fee shall be charged for the issue of diplomatic and official passports

2.2 Schedule 1 and schedule 2 specify exhaustively the only people to whom diplomatic and official passports can be issued. These schedules provide as follows:

SCHEDULE 1

(section 1)

CATEGORIES OF PERSONS ENTITLED TO DIPLOMATIC PASSPORTS

The President of the Republic

The Prime Minister

The Speaker of Parliament

Government Ministers

Vanuatu Ambassadors

Vanuatu High Commissioners

Foreign Affairs personnel: diplomatic and consular staff

Leader of a delegation or sole Vanuatu representative at international conference or bilateral or multilateral negotiations

Diplomatic couriers

Persons in respect of whom the Minister considers exceptional circumstances apply

Spouses of persons granted Diplomatic Passports provided they are travelling on duty at Government expense

SCHEDULE 2

(Section 1)

CATEGORIES OF PERSONS ENTITLED TO OFFICIAL PASSPORTS

Members of Parliament

Chief Justice

Attorney General

Judges of the Supreme Court

Solicitor General

Magistrates

Commissioner of Police

Ombudsman

Chairman of the National Council of Chiefs

Officers of Vanuatu Government and Parliament

Persons in respect of whom the Minister considers exceptional circumstances apply

Spouses of persons granted Official Passports provided they are travelling on duty at Government expense

2.3 Therefore two important requirements are that:

(a) The official or diplomatic passport is issued by an officer authorised by the Foreign Affairs Minister. (In that regard there should be a written and gazetted instrument appointing and authorising an officer of the Ministry of Foreign Affairs to issue these types of passports). Note also that there is no legal authority for the Minister to issue the passports him or herself; and

(b) Official passports and diplomatic passports can only be issued to persons set out in the categories stated in schedule 1 or schedule 2 by the appointed officer per (a) above.

2.4 There does not appear to be any legal basis to issue 'Honorary Consuls' or 'Trade Commissioners' with a diplomatic passport or official passport. I do not consider either of these officers falls within 'Officers of Government and Parliament' (who may hold official passports (but not diplomatic)). This category comprehends posts such as the Clerk of Parliament and political secretaries, all of whom are paid by the Vanuatu government. Both 'Honorary Consuls' and 'Trade Commissioners' posts are unpaid.

2.5 On the face of the two schedules from the Diplomatic and Official Passports Act there is a no prima facie legal basis to issue an 'Honorary Consul' or 'Trade Commissioner' with a diplomatic passport or official passport. One must consider whether these classes of person fall within either 'Foreign Affairs personnel: diplomatic and consular staff' or 'Persons in respect of whom the Minister considers exceptional circumstances apply.'

2.6 With respect to the first, the issue is whether 'consular staff' referred to in the 'Foreign Affairs personnel' category includes the position of 'Honorary Consuls'. (Clearly, 'Trade Commissioners' are not included). Our legal opinion is that 'Honorary Consuls' are not included. This is because 'consular staff' must be 'personnel' of the Foreign Affairs Ministry. The word 'personnel' is not defined in the Act. The Oxford English Dictionary (6th ed) defines the word at page 825 as follows:

Body of persons employed in public undertaking, armed forces, factory, office, etc

2.7 Accordingly, 'consular staff' as used in schedule 1 of the Act are persons that are in a relationship of employment with Vanuatu’s Foreign Affairs Ministry. This interpretation is consistent with the balance of the categories in schedule 1. All those other persons mentioned are in a relationship of employment with the Government or Republic of Vanuatu. The only overt exception to this is spouses of the above.

2.8 The only other possible basis one must consider Trade Commissioner is whether these classes of person fall within 'Persons in respect of whom the Minister considers exceptional circumstances apply.' It is difficult to see how Trade Commissioners would fall into this exception. An example of an exceptional situation might be if Vanuatu wished to send a representative to the funeral of Princess Diana and the President and Speaker were not available to attend. In that circumstance the Minister of Foreign Affairs might approve the issue of a diplomatic passport to a paramount chief to attend on Vanuatu’s behalf. The passport would then be handed back in after the representative returned from the trip to the Department.

2.9 This exception is a quite different from issuing passports to every third foreigner 'willy nilly' without consistency or logic instead of on rare exceptions. These passports are valid for five years and give the holders certain privileges and protections that can be abused. For example diplomats can often attempt to be exempted from having their bags searched at foreign airports. For the unscrupulous this means that they could carry 'dirty' money, drugs or even weapons with less risk than on an ordinary passport. If this is revealed then the value of diplomatic and official passports to genuine representatives of Vanuatu is harmed.

2.10 Two other points should also be noted:

(a) The Consular Relations Act [Cap 200] also, which adopts the Vienna Convention on Consular Relations (24/04/63) makes no reference to the issue of diplomatic and official passports to Trade Commissioners or Honorary Consuls; and

(b) The appointment does not become effective until the receiving State agrees and accepts the nomination of the sending state (Vanuatu in this case). This requirement is specified at item 1 in Vanuatu Council of Ministers’ own written criteria on appointments of Honorary Consuls annexed to the Jung report of 3 December 1997. A copy of the Ministers’ criteria is annexed as annex '1'.

3 WHY WERE THE PASSPORTS IMPROPERLY ISSUED?

3.1 It appears that Ministers, Vohor, Soksok, Jimmy, and Korman, may have arranged for passports to be issued for corrupt or improper purposes. It appears that on occasion money and or other benefits may have been given to the Ministers in exchange for the passports. The Ombudsman’s Office does not believe that it has evidence of all the payments or benefits that may have been made because the nature of corruption is to hide itself.

3.2 However, the evidence that has been gathered appears to show a disturbing connection between money and/or benefits and passports for these four Ministers. There appears to be no other plausible or reasonable explanation for issuing passports to people who were not accepted in the countries in which they were supposed to be representing Vanuatu - most of which where no Ni Vanuatu people live and many of which have no trade with or investment in Vanuatu. This allegation was put these four Ministers in the preliminary report and none of them denied it.

3.3 No evidence is held of receipt of payments or benefits by Mr Sope. In respect to Mr Sope in the absence of any legitimate explanation, as to why Mr Swanson received a diplomatic passport I consider that it was issued irregularly. Mr Sope denied any corrupt link.

3.4 Set out below is information that may suggest a link between former Ministers Vohor, Soksok, Jimmy, and Korman, and some of those issued with passports. It is also to be noted that most of those passports issued were done so on instructions by individual Ministers and not by the Council of Ministers. For passport holders appointed by the Council itself most had acceptance letters sent from the receiving country.

Mr Korman

3.4 Funds received from a company named Mascot Holdings Limited (This is the same company that was reported in the Trading Post on 3 February 1996 as being associated with Mr Korman and funds requested by him from Honorary Consuls) shows that Mr Korman has authority on the transfer of funds from the account of Mascot Holdings Limited.

3.4 Mr Korman received funds from an account at Bank Bumiputra Malaysia Berhad Airport Branch. This is also an account associated with Mr Korman and funds requested from the Honorary Consuls.

3.5 Many of these amounts are listed in the report that this Office has carried out in respect to Mr Korman’s use of the 'Cyclone Betsy' account. For the purposes of this report the statements made in that report can be taken as repeated here. One prime example from that report is the letter dated 29 August 1995 from Wong Sing Wa the 'Vanuatu Trade Commissioner in Hong Kong' sent to Mr Paul Lien Than the 'Honorary Consul for Asia'. In that letter Mr Wa refuses Mr Paul Lien Than’s request made on behalf of Mr Korman and says further 'we’ve already done our best support to Prime Minister’s election and had made two contributions totalling US$30,000.00 in the earlier days during PM’s visit to Hong Kong last time.'

Mr Vohor

3.6 The Ombudsman’s Office has obtained evidence that Mr Vohor was paid just over US$5,000 by a person calling himself Mr Wilson Hilhong Lickie YAM Junior, Vanuatu’s 'Honorary Consul to Malaysia'. A copy of the bank receipt document dated 10 May 1996 confirming this deposit to Mr Vohor’s account is annexed as '2'. This allegation was put to Mr Vohor and he did not deny it. From the tables above it will be noted that Mr YAM was issued with the following passports, following appointments made by Mr Korman:

• D000169 on 4 October 1994
• X000449 on 7 February 1995
• D000194 on 18 January 1996
  

3.7 Mr Vohor received and transacted a number of lump sums in cash totalling US$60,000 which were detailed in the Ombudsman’s Public Report regarding passports issued the family of Jian Peng CHEN, dated 4 February 1998, the 'Honorary Consul to Macau'. Mr Chen also is the holder of a diplomatic passport, D000026 - refer No 19, table 1 above. Three of these payments coincide with the dates of Mr Chen’s meetings with Mr Vohor. The fourth and last occurred the day after the Chen delegation left Vanuatu after they had received passports three days earlier on 14 August 1997.

3.8 Mr Amos Bangabiti MP in his reply to the Jung Pardon report of 30 January 1998 stated that he had been coerced to sign the pardon letter by Mr Alfred Massing MP because Mr Richard Jung was reportedly paying money to the UMP and Mr Vohor. Mr Jung also received passports through Mr Vohor’s help as detained in our public report of 3 December 1997.

Mr Jimmy

3.9 Mr Jimmy benefited from gifts from Mr Chen in his trip to Macau and also payment of a trip to Australia and spending money. Mr JP Chen has recently confirmed in writing that Mr Jimmy’s trip to Macau was in his official capacity as a Minister. Despite this Mr Jimmy never accounted the gifts to the Republic but retained them as his own personal property. This was detailed in paragraphs 6.21-6.25 and 6.35-6.37 in the Ombudsman’s Public Report regarding passports issued the family of Jian Peng CHEN, dated 4 February 1998.

Mr Soksok

3.10 On or about 7 October a political secretary of Minister Vidal Soksok went to a commercial bank in Port Vila and attempted to open a new bank account in Mr Soksok’s name. He then attempted to deposit a cheque for US$15,000 into this account. The cheque for US$15,000 was not made out to Mr Soksok but the 'Ministry of Foreign Affairs & Immigration, Republic of Vanuatu'. To attempt to negotiate the cheque belonging to someone else to one’s own benefit amounts to a type of theft called conversion. It is possible that this cheque is connected with Mr Soksok’s unlawful issue of passports. The bank concerned refused to open the account in Mr Soksok’s name. Copies of the cheque and bank’s diary note are annexed as '3' and '4'. Two Chinese Messrs Zhang and Liu were appointed as 'Trade Commissioners to Canada and Vietnam' and issued with official passports the month before by Mr Soksok (refer 39 and 40 on Table 2).

Mr Sope

3.11 Mr Sope arranged for issue of a diplomatic passport for now convicted fraudster Peter Swanson who was the chief architect of the US$100 million bank guarantee scam. Mr Swanson was sentenced to 20 months’ imprisonment on 5 December 1997 on the following 7 counts:

• Attempted Obtaining of Property by False Pretences, contrary to sections 125(c) and 28 of the Penal Code Act [Cap 135]
• Fraudulently attempting to induce a person to invest money, contrary to Section 11 of the Prevention of Fraud (Investments) Act [Cap 70]
• Dealing in securities without a Dealers licence, contrary to Section 2 of the Prevention of Fraud (Investment) Act
• Forgery, contrary to Section 140 of the Penal Code
• Uttering Forged Documents, contrary to section 141(a) of the Penal Code
• False Statement by a promoter, contrary to section 129(c) of the Penal Code
• False statement by promoter, contrary to section 129(c) of the Penal Code
  

3.12 By providing Mr Swanson with a diplomatic passport I consider that Mr Swanson was able to commit his criminal activity more easily with the benefit of a diplomatic passport. The basis for my statement appears in Mr Sope’s own letter to the DFA director Mr Sese dated 26 March 1996, a true copy of which is annexed as 4A Mr Sope says within that letter:

I herein advise you that Mr Peter Harold Swanson will hereafter, carry out an important task as a diplomat of this country, therefore you are to issue Mr Swanson with a diplomatic passport within 24 hours.

3.13 Mr Sope was involved with a Council of Ministers decision to appoint Mr Armoury Groenen, Vanuatu’s 'Special Trade Representative to the ‘Middle East. Mr Groenen is from the European country of Belgium but lists his residential address on his CV as in England.

3.14 It is uncertain as to what was behind this bizarre appointment but what is most concerning is that Mr Sope, on instructions from the Council of Ministers (of which he was a member) gave Mr Groenen a power of attorney on behalf of Vanuatu in which states 'that any negotiation entered into by the Mr Groenen shall be as good and effectual where it is done in accordance with this Deed as if the same has been made, executed or done by the Government in its proper name'. A copy of this power of attorney is annexed as '5'. This means that Mr Groenen can, amongst other matters, in my view legally bind the Republic of Vanuatu to contracts without the Attorney General or anyone else in Vanuatu looking at it first. Mr Sope disagrees with this interpretation of the deed and his view is set out in section 5, point (g).

4 THE ROLE OF MR JEAN SESE, DIRECTOR OF FOREIGN AFFAIRS DEPARTMENT

4.1 Mr Sese is apparently a well qualified and experienced director. Until his recent suspension pending a disciplinary hearing in connection with his issue of a passport to convicted criminal and illegal immigrant Yae Yong Richard Jung, Mr Sese had been director of the Foreign Affairs Department for many years.

4.2 Unfortunately, despite his qualifications and experience, Mr Sese has shown himself to be either stupid or possibly corrupt or a combination of both. However one may characterise him, the fact is that from mid 1993 onwards Mr Sese, as the person in charge of the Department given the statutory authority to issue diplomatic and official passports, allowed about 64 passports to be issued to persons for whom there was no letter of acceptance held from the receiving country and for many for whom nothing was known, not even an address. Fortunately, as detailed in the tables a number of these passports are in the custody of the Department of Foreign Affairs. The only explanation for allowing issue of passports to:

• such nebulously entitled persons as 'special advisers'
• an Honorary Consul for the whole of 'Asia'
• Vanuatu’s 'ambassador' to Hong Kong
• various persons with Chinese names but with recently issued passports from various other third countries
• an Honorary Consul to China (a country that specifically does not have any honorary consuls in its country)
  

is incompetence or corruption.

5 REPLIES

Reply of Mr Sope

5.1 Mr Sope replied. He did so by letter dated 18 February 1998. A copy of his reply is annexed as A. It will be noted that some of his reply is blacked out. The reason for this is that Mr Sope has repeated points made by me in the preliminary report to which he did not agree. Having considered Mr Sope’s reply I accepted that certain comments were not appropriate in respect to him and it is fair to observe that his activities were not as grossly in breach of the Leadership Code as the other four Ministers. It therefore would be unfair to him if the preliminary comments made about him which I had agreed to remove from the final public report still remained through his repetition of them in his own reply.

5.2 I should add that I did not agree with all of the criticisms made by Mr Sope so a number remain stated in the final report. I now summarise the points made by Mr Sope in his reply and comment on them.

(a) Mr Sope states that in respect to Mr Swanson it was a decision of the Minister of Foreign Affairs and that he only made a 'request'. He says that the Foreign Affairs Minister makes a decision on exceptional circumstances [and the implication in this is that there were exceptional circumstances].

Comment

Mr Swanson had not been approved by the Council of Ministers. Mr Sope’s letter to Mr Sese was in the form of an order and not a request. Mr Sope’s language was 'therefore you are to issue Mr Swanson with a diplomatic passport within 24 hours'. See appendix 4A. Further Mr Sope makes no reference to what the exceptional circumstances were. Obviously what these must have been were Mr Swanson’s ability to carry out his 'special assignment', the US$100 million bank guarantee scam. Mr Sese’s reply to Mr Sope’s letter says as follows:

'26th March 1996

Mr Peter Swanson

c/o Ministry of Finance

Port Vila

Dear Mr Swanson

After consultation with the Minister of Finance, Hon B Sope, and the Minister of Foreign Affairs, Hon A BANGABITI, today, and in accordance with the Power of Attorney conferred onto you by the Prime Minister, Hon M Carlot KORMAN, on March 22, 1996 to undertake a special assignment on behalf of the Vanuatu Government, the Department is pleased to issue the Vanuatu Diplomatic Passport D000197 both in recognition of the task you are about to do and to facilitate your work.

The passport is to be returned to this Department on the completion of this assignment which is understandably at the end of this year 1996.

Yours faithfully

Jean Sese

Director

cc: - Hon Prime Minister

': - Hon Minister of Finance

': - Hon Minister of Foreign Affairs

(emphasis added)

(b) Mr Sope then gives his opinion on the law in relation to section 2 of the report and disagrees with the legal analysis appearing in the report.

Comment

Mr Sope is not a lawyer. I prefer to rely on the legal advice provided to me by qualified lawyers.

(c) Mr Sope objected to the original comments made by me in relation to how I had characterised his connection with issue of passports to Messrs Groenen and Swanson.

Comment

In view of my acceptance of his comments on this point I amended the report.

(d) Mr Sope made a further objection to the manner in which I had characterised his connection with the Bank Guarantees.

Comment

In view of further legal advice that I obtained I amended the report in light of Mr Sope’s comments. I reserve my position in respect to the point and do not change the findings made about Mr Sope in any of the three Bank Guarantees Public Reports.

(e) Mr Sope objected to my view that by providing Mr Swanson with a passport it was easier for him to commit criminal activity. Mr Sope asked 'Where is the proof?' Mr Sope also mentions the fact Mr Swanson has appealed his case to the Appeal Court.

Comment

The fact is that Mr Sope was not authorised to take part or sign the Bank Guarantees by the Council of Ministers. It is a fact that Mr Sope did sign the guarantees without authority. It is a fact that Mr Swanson was involved in this 'special assignment'. Mr Sope in his letter to Mr Sese told him that
Mr Swanson was to 'carry out an important task as a diplomat of this country, therefore you are to issue Mr Swanson with a diplomatic passport within 24 hours'. Mr Sope in his own letter therefore sees the passport integral to
Mr Swanson carrying out his 'important task'. Further Mr Sese in his reply tells Mr Swanson that his 'Department is pleased to issue the Vanuatu Diplomatic Passport D000197 both in recognition of the task you are about to do and to facilitate your work'. Therefore in answer to Mr Sope’s question 'Where is the proof?' I would suggest that it is on his own files and is a conclusion based on common sense.

(f) Mr Sope states that it is a complete lie to say that Mr Sope arranged for Mr Groenen’s official passport and his appointment.

Comment

I consider Mr Sope is justified. Our original information checked by Department of Foreign Affairs suggested that Mr Sope had acted alone. Following a further consultation between my office and Foreign Affairs, they produced a letter from Mr Tabiusu to Mr Sope stating that Mr Groenen had been approved by the Council of Ministers (a copy of which is annexed as 6). However, it is to be noted though that in the deed of signed by Mr Sope it states that it is Mr Sope on behalf of the Government who appoints Mr Groenen

Additionally, the fact remains that Mr Groenen received his official passport before any approval was received from the Belgian authorities. It still has not been received despite the Department of Foreign Affairs now writing (after issue of the passport) to the Belgium authorities.

(g) Mr Sope disagrees with my statement that the deed gave Mr Groenen the power contract on behalf of Vanuatu. He says that this statement is misleading and that he has taken legal advice on this point.

Comment

I stand by the original statement. The deed talks about things being 'effected and executed'. It is therefore my view, based on legal advice, that the deed did give Mr Groenen the ability to conclude contracts within his area of responsibility - namely, the Middle East. Mr Sope is also correct to point out that the Attorney General has signed the deed as well.

(h) Mr Sope then comments on the findings that had been made in the preliminary report. He repeats some matters already stated by him and introduces some new points. Of these new points - first he says that both Messrs Groenen and Swanson gave CVs which were considered by the Council of Ministers who approved both.

Comment

As noted above I accept that the Council of Ministers approved Mr Groenen. This fact does not make the issue of the official passport to him lawful. It remains unlawful and unreasonable in my view. Further investigations have uncovered the CV for Mr Groenen. It is annexed as 7. It is a vague and fairly imprecise document of one page in total in all probability prepared by
Mr Groenen himself. In my view, it is not the sort of document that one could rely on to issue an official passport. Independent checks must be made. That is the whole purpose of getting approval from the receiving state before the passport is issued. Mr Groenen received his passport in August 1997 but it was not until 30 October 1997 (after the Ombudsman’s Office had commenced its enquiry) that Mr Sese sought approval from Belgium for Mr Groenen’s appointment. Attached as 8 and 9 are true copies of Mr Sope’s First Secretary’s letter to Mr Sese dated 3 October 1997 and the diplomatic note sent by Mr Sese dated 30 October 1997 seeking approval from Belgium. No response has been received to this it is understood.

A CV for Mr Swanson could not be located despite efforts by this Office. If it did exist I am curious to know whether it showed that Mr Swanson was a former bankrupt. Subsequent events with the Bank Guarantees Scam in my view show that issue of a passport to Mr Swanson was foolish as well as being unlawful. No approval was ever received by any receiving state for Mr Swanson.

The final point to note is that nowhere in his reply does Mr Sope disagree with the Council of Ministers’ own criteria for the appointment of Honorary Consuls, appendix 1.

(i) Mr Sope then concludes with some overall criticisms of the Ombudsman and the manner in which it carries out its functions.

Comment

Mr Sope’s comments are not relevant to the report at hand so I do not make any comment on them.

Reply of Mr Sese

5.3 Mr Sese provided a 2 page written reply dated 12 February 1997. Some of his reply addressed the facts and allegations contained in the preliminary report. He made other comments that do not relate to these matters in the preliminary report. I set out below the substance of his reply where it relates to relevant matters.

5.4 The first relevant point that he made was his statement:

The Diplomatic and Official passports were issued on ministerial instructions and after the appointments had been made by the Vanuatu Government. Once the appointments and the instructions by the Council of Ministers, the Prime Minister or the Minister of Foreign Affairs have been made, the Department of Foreign Affairs does not have much choice but to act accordingly.

Comment

5.5 There are a number of points upon which I consider Mr Sese to be incorrect:

(a) The appointments were not made by the Government. Most of the appointments that are listed in the Tables were made by individual Ministers. These Ministers for reasons explained already did not follow the law nor their own criteria. Mr Sese must be taken to know the criteria and the law - those persons who were entitled to passports and those who were not.

(b) It is not an excuse to break the law to say a Minister or the Council of Ministers told me to do so. If Mr Sese felt he had no choice he could have consulted the Attorney General for legal advice to deal with the situation or complained to the Ombudsman’s Office. The Department did have a choice in my view. Mr Sese in my opinion failed to show sound leadership by meekly complying with ministerial instructions that clearly on their face were unusual and came without any letter from the receiving country approving the nominee.

I have no knowledge of any intention or acts from anybody which would involve sales of or any financial or other transactions for Vanuatu diplomatic and official passports. May I, therefore, respectfully suggest that you delete the terms' either stupid or possibly corrupt or a combination of both' and 'incompetence of the grossest form or corruption.' in paragraph 4.2 on page 11 and again 'grossly incompetent or . . . corrupted in some way, either by way of offer of money or for fear of consequences.'

5.5 Mr Sese then expressed his general dissatisfaction with the choice of words used in the report. He said that he was insulted as a ni Vanuatu.

5.6 I am not prepared to change my assessment of Mr Sese’s role. I am unable to discern any other explanation for such a systemic problem with the department’s practice of issuing diplomatic and official passports under the directorship of Jean Sese.

Mr Korman’s reply

5.6 Mr Korman sent the Ombudsman’s Office a reply after the final public report was first issued. Since it was only received a few days late I decided to modify the report and include his reply. His reply in French and English translation is attached as 'B'.

5.7 The reply is general. Mr Korman suggests in general terms that he did everything legally and did not obtain any benefits.

5.8 In view of his still unexplained [by him] facsimile to Mr Lien Than, 'Honorary Consul to Asia' of August 1995 and the findings into his bank accounts in the Cyclone Betsy report of 26 February 1998 (also unexplained to date) I am unable to give his reply any credibility. Mr Korman stated in the fax as follows:

Commissioners, Special Representative like Mr. LAI and Matsumoto, and Honorary Consuls:

I ask them to transfer their contribution as requested my ASIACITI TRUST Company in Hong Kong and Shanghai. Banking Corporation 10 Collyer Quay, # 01 Ocean Building, Singapore 0104 A/C MASCOT HOLDING INC # 141 - 246660 - 01. (Bold added)

I repeat the No. of A/C

A/C MASCOT HOLDINGS INC.

A/C No. 141 - 24 6660 - 01

Or In Malaysia - Kuala Lumpur

Bank BUMIPUTRA MALAYSIA BERHAD, AIRPORT BRANCH No. A/C CA 1173 - 48.

Paul, the Singapore Honorary Consul is already put 10.000 dollars US in my account. Mr. Matsumoto promises me to meet me in Tokyo and give me 5 000 dollars on 24 August.

Please Paul ask the others to do their part immediately. I we received negative answers from the others by the end of this month I will personally as P.M. and Minister of Foreign Affairs cancel their nominations as Vanuatu Government Rep in overseas.

Paul please give me reply immediately by Fax because I’m leaving on # 24 August in the morning.

Regards to you and Bon

Courage et à bientot à Port-Vila.'

(signed by Mr Korman)

6 FINDING OF MISCONDUCT

Finding No 1: Messrs Korman, Vohor, Soksok, And Jimmy Acted In Breach Of The Leadership Code By Directing Improper Issue Of Diplomatic And Official Passports

6.1 These men all ignored the law, their own Ministerial criteria and common sense and at will issued passports to foreigners about whom little was and is known. The information gathered to date and their activities in matters points to the Ministers’ conduct to be have been motivated by corrupt purposes - financial and/or political.

6.2 In doing so it appears that they used their public offices for private gain and as such cynically breached the principles of the Leadership Code.

Finding No 2: Mr Sope acted improperly and in breach of the Leadership Code by directing Improper Issue of a Diplomatic Passports to Mr Peter Swanson

6.3 I consider that Mr Sope ignored the law, the Council of Minister’s own criteria and common sense in his involvement with the issue of a diplomatic passport to Mr Swanson. He should not have directed Mr Sese to issue the passport to Mr Swanson. Mr Swanson was a former bankrupt and ended up being involved in activities that resulted in his trial and conviction on criminal offences. I consider that Mr Sope’s integrity was left gravely open to question as a result of his conduct in all the circumstances.

Finding No 3: Mr Sese issued or allowed his Department to Issue Passports in breach of The Official and Diplomatic Passports Act, was incompetent and left his integrity open to question

6.4 Even if Mr Sese believed that Honorary Consuls and Trade Commissioners were within the classes of persons to whom the said passports could issue, had he insisted on first receiving a letter of acceptance from the receiving country first this sorry debacle may well have been avoided. He did not do this and I form the opinion that he was grossly incompetent or corrupted in some way, either by way of offer of money or for fear of consequences if he had stood up to the Ministers concerned.

7 RECOMMENDATIONS

Recommendation 1: Messrs Korman, Vohor, Jimmy, Soksok and Sope not be reappointed as Ministers and not hold position of public responsibility

7.1 I consider that all the above, by reason of acting contrary to the Leadership Code, should not be reappointed as Ministers. I note that each of these Ministers has been the subject of similar recommendations in past reports.

Recommendation 2: Parliament to pass an Act for the Leadership Code

7.2 This report and the fact that no Ministers have been brought to account for conduct in breach of the Leadership Code once again shows the desperate need for Parliament to pass a Leadership Code Act that will provide for punishment of those breaking the Leadership Code in the Constitution.

Recommendation 3: Public Prosecutor with the assistance of Police to investigate whether criminal charges should be brought

7.3 Pursuant to section 25(1) of the Ombudsman Act I am referring this matter to the Public Prosecutor for consideration as to whether criminal charges should be brought. Without limiting the scope of the Public Prosecutor’s enquiry into the facts I consider that:

(a) US$5,000 payment to Mr Vohor from Wilson Hilhong Lickie YAM Junior, deposited into Mr Vohor’s personal bank account; and

(b) US$15,000 cheque made out to 'Ministry of Foreign Affairs & Immigration, Republic of Vanuatu' that a political secretary attempted to deposit into a personal account to be opened for Mr Soksok;

may be evidence of the offence of corruption and bribery under section 73(1) of the Penal Code in relation to Mr Vohor and misappropriation under section 123 of the Penal Code in relation to Mr Soksok.

7.4 I note that a similar recommendation has already been made by me in relation to Mr Korman in the Public Report on Breach of the Leadership Code on Misuse of Cyclone Betsy account by the former Prime Minister of Vanuatu,
Mr Maxime Carlot Korman (26 February 1998). The information in that report appeared to show a strong link between payments of money to Mr Korman and his appointment of Honorary Consuls.

Recommendation 4: The Public Service Commission to within 30 days of the date of this report to convene a disciplinary hearing by the Public Service Disciplinary Board concerning Mr Sese allowing the issue of official and diplomatic passports without letters of approval from the receiving countries

7.3 This is what was recommended in the Ombudsman’s report on the issue of an official passport to Richard Jae Yong Jung. At that time I noted that the issue of a passport to Mr Jung was symptomatic of a substandard practice in relation of issue of official and diplomatic passports. The great number of passports improperly issued as specified in the schedules bears this out.

7.4 Under s 11 of the Public Service Act [Cap 129] it is a disciplinary offence for a public servant who:

is negligent, careless, indolent, inefficient, or incompetent in the discharge of his duties.

7.5 Mr Sese is a public servant and his duties include overall responsibility for the Foreign Affairs Department, including responsibility for the issue of official and diplomatic passports. I consider that he was negligent, careless and incompetent in allowing the passports listed in the two tables to be issued to persons without first obtaining the letters of approval.

7.6 As stated in the Jung report if Mr Sese was to resign and agree not to take employment in the public sector again that may avoid the need for the Public Service Disciplinary Board to be convened to determine the matter. That will be a matter for Mr Sese. Otherwise, I consider that the matter must be determined by way of a disciplinary hearing.

Recommendation No 5: Department of Foreign Affairs acting under advice of the Attorney General to require return of passports for which no approval letter held from receiving country and to advise diplomatic missions and embassies that said passports are void and invalid

7.7 The above recommendation is self explanatory. To regain respect for diplomatic and official passports issued by Vanuatu I consider that this step must be taken. If it is not then it is quite possible that genuine holders of these types of passports may be inconvenienced whilst passing through immigration authorities in other countries. This is because other countries may wish to add in extra checks to ensure the validity of individual Vanuatu’s diplomatic and official passports.

MARIE NOELLE FERRIEUX PATTERSON

OMBUDSMAN OF THE REPUBLIC OF VANUATU

13 March 1998. (reissued 18 March 1998)

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^[1] Refer Public Report on Appointment of Resort Las Vegas as Agent for “Immigration Scheme for Vanuatu” and the conduct of Prime Minister Rt Hon Serge Vohor and Foreign Affairs Minister Hon Vidal Soksok in assisting the grant of Citizenship and issue of Ordinary and Official Passports to Mr Jae Yong (Richard) Jung, 3 December 1997

^[2] Refer Public Report on the provision of Bank Guarantees in the sum of US$100,000,000 in breach of the Leadership Code and section 14 of the Ombudsman Act and related matters thereto, 3 July 1996

^[3] Mr Wang, Mr Korman’s “Special Representative in Jakarta, Indonesia” and “President” of the now defunct Dragon Bank was in 1996 investigated for allegations of defrauding other banks.