Forest fraud

Illegal logging of government land at Komaridi costs government $30m in lost revenue


AN investigation by the Island Sun newspaper has uncovered a major fraud in the logging industry, linking the Commissioner of Forest, Reeves Moveni and the landowners of a 5,560 hectare tract of land reserved for the development of the Komaridi Hydro scheme in east Guadalcanal.

The Government has abandoned the project but the land is still on a 75-year lease to the Government.

Landowners have however been logging it, raking in about $64 million in revenue under a felling licence granted by Mr Moveni, allegedly knowingly for the land already on lease to the Government.

Sources told Island Sun that this is a major fraud, and those responsible should be arrested and charged for defrauding the Government.

“This is costing the Government up to $30 million in lost revenue since Mbetilonga Land Holdings Group Community Company Ltd and One Pacific Company Ltd signed a five-year deal to log the reserve.

“Those who facilitated the illegal logging deal should be investigated with a view to charging them for being part of the scheme to defraud the Government,” one source knowledgeable about the logging industry told Island Sun on the weekend.

Documents obtained by Island Sun show Moveni has signed off Parcel Numbers 191-060-1, 191-060-2 and 191-060-3 for the logging operations. The Map of the Reserve shows these Parcel Numbers are the same numbers for the catchment area, over which the Government has a 75-year lease in force since December 2, 1980.

The government is paying $500,000 in rentals for the three parcels, according to the Lease Register documents obtained from the Honiara Land Registry.

These documents show Moveni granted Felling Licence No. A101521 to Mbetilonga Land Holdings Group Community Company Ltd on April 24, 2015. Under the licence, the company is given an annual production quota of 50,000 cubic metres – 40, 000 cubic metres for export annually and an additional 10,000 cubic metres of sawn timber, the documents show.

The company has since entered into a “Mutual Technology and Management Agreement” with an Asian company called One Pacific Company Ltd.

Many suspect the Asian company is a shelf company, established for the convenience of accessing the rich forest resources in the reserve, owned by the Government.

It is estimated that the reserve still has about 400,000 cubic metres to be harvested.

One Pacific Company Ltd has been logging the reserve since it signed a five-year agreement with Mbetilonga Land Holdings Group Community Company Ltd on April 23, 2015.

The five-year agreement expires on April 24, 2020.

Mbetilonga Land Holdings Group Community Company Ltd and One Pacific Company Ltd share the proceeds of sale of round logs extracted from the operation.

A Malaysian-owned company, Gallego, owns the machinery used in the illegal felling of trees on the government land. The company uses its logo pond at Tenaru Beach, east of Honiara, to smuggle the illegal logs from the logging site, using its joint venture operation under Mbahumea logging company.

It is estimated that Mbetilonga Land Holdings Group Community Company Ltd received $63,751,172.76 since shipments began on November 24, 2015, according to shipment log obtained by Island Sun.

In terms of volume, some 65, 698.631 cubic metres of round logs were exported between November 24, 2015 and October 4 last year. In that time the company paid about $15 million in export duties.

The money should have been going to government coffers given it is the legal custodian of Parcel No. 191-060-01, 191-060-02 and 191-060-03 under the lease agreement. Mbetilonga Land Holdings Group Community Company Ltd, has however claimed it has not received any rental payments for quite some time and is engaged in the logging operations to recover what it is owed.

Island Sun was unable to contact Mr Moveni for comments.

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