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PHILIPSBURG--The Prosecutor's Office requested eight months, deprivation of the right to be elected and a five-year ban from the civil service for former Minister of Finance Hiro Shigemoto on Wednesday during the first day of hearings in the so-called Piranha case.

Shigemoto and Global Advisory Services (GAS) BV Director R.A.G. (62) are facing fraud, embezzlement, forgery and money-laundering charges.

G. is suspected of having made fraudulent transactions in connection with the recruitment of personnel for various government agencies that allegedly cost Country St. Maarten NAf. 233,054.

Shigemoto is accused of having facilitated the fraud in contravention of the Accountability Ordinance (Comptabiliteitswet), which constitutes misconduct as a civil servant in connection with the payment of falsified bills.

G. also is standing trial on money-laundering charges. For him, the Prosecutor requested 12 months and a NAf. 233,000 fine.

Investigation

The Piranha investigation started after a complaint was filed by then-Head of Finance Bas Roorda in March 2011. National Detectives started an investigation in November 2011. G. was arrested in connection with this case on December 3, 2012. Shigemoto was held on December 17, 2012, and released again seven days later. The investigation was closed in June 2013. Several preliminary hearings were held last year.

Shigemoto served as Finance Minister from October 10, 2010, to May 2012, as a member of the government led by United People's (UP) party. Prior to that, he was Acting Director of Means with the Department of Finance from September 2006 to June 2010 and Acting Secretary-General from June 2010 to October 2010.

The fraud concerns invoices sent in for payment of GAS services in connection with the recruitment of highly-skilled personnel for the government of Country St. Maarten, as well as a one-year USONA-financed project to hire staff for the new Tax Department to the maximum all-inclusive amount of NAf. 336,000, including travel and other expenses.

In July 2009, the Executive Council approved GAS as partner for the Tax Office project, on Shigemoto's recommendation. The project was to start June 15, 2009, and to be concluded on June 14, 2010. The amount was exactly the same as mentioned in the terms of reference for the project, which, according to Prosecutor Maarten Noordzij, meant that G. must have had prior knowledge about these terms.

The service agreement to recruit personnel for Country St. Maarten was valid from January 1 to June 29, 2009. The project was approved by the Executive Council on April 14, 2009, and budgeted for NAf. 170,964, with no public-bidding process held.

Success fees

The Prosecutor's Office is holding it against the GAS director that he had sought payment of nine invoices for services provided outside the official contract period and that he had incorrectly submitted three "success fees" for persons who either were not hired or already had been in government employment.

Shigemoto is suspected of having facilitated and sanctioned the forged invoices.

After Roorda reported the wrongdoings and turmoil started at the Department of Finance, which led to Roorda's dismissal after he went to the Prosecutor's Office to file a report, the service agreement was extended to December 31, 2009, on instigation of the Finance Department, according to Prosecutor Noordzij.

He did not lend any credibility to statements made by suspects, who told the Judge on Wednesday that the agreement had been "tacitly" renewed. According to the Prosecutor, G. had forged and changed the period mentioned in the service agreement without Shigemoto's knowledge.

G. maintained that all invoices had been filed in accordance with the rules and regulations. Shigemoto said he had signed the contested invoices for approval, but added that this was, in fact, merely a proof of receipt, because Finance Department staff members were in charge of control, validation and payment.

Swindle

According to the Prosecutor, however, G. had swindled government out of NAf. 233,000 and Shigemoto had been closely involved.

According to Shigemoto, it was not necessary to put the projects up for public bidding because G.'s business was the only qualified party.

Shigemoto had been closely and actively involved with the nature, content and coming-about of the service agreement.

"Shigemoto helped G. in the saddle, contributed to G. obtaining a double position [GAS business owner and project leader for the tax office – Ed.] and when this double position caused problems with payments, he thought about and contributed to a solution which only served co-suspect G.'s interests, which left Country St. Maarten out in the cold. The Minister should have adhered to the agreement and not circumvented it," said Noordzij.

The Prosecutor said Shigemoto had played a "crucial" role in the scheme, because the invoices never would have been paid out without his approval. He was guilty of violation of the Accountability Ordinance for as long as it concerned the period before 10-10-10, and of being an accomplice to embezzlement.

The Prosecutor's Office agreed that this case had taken a long time in the making, but denied that it had concerned an undue delay. However, the long timeframe warranted a reduction on the sentences.

The ex-minister had violated the rules of good governance and integrity and had "squandered" the interests of St. Maarten and its residents. According to the Prosecutor's Office, suspects had been in a friendly relationship with each other, which had led to a situation in which G'.s personal gain prevailed over national interests. However, it was not established that Shigemoto had enjoyed any financial gain in the scheme.

The Prosecutor found it proven that suspects had cooperated "in a refined manner" in committing fraud and forgery/embezzlement as civil servants. "It was made possible for suspect G. to misappropriate a large sum of money that was intended to build up Country St. Maarten," said Noordzij. These crimes warranted unconditional prison sentences, he stated.

The hearings in this case resume today, Thursday, with the lawyers' pleadings.