Dear Sir,

A recent joint select committee report revealed that approximately $4.4 million in the Bermuda Government 2023-24 budget was tied to the September 2023 cyberattack, raising questions about whether public funds covered a ransom payment. That is all we know about that $4.4 million of taxpayer dollars. We don’t know who authorised the payment, who received it or what it was for.

We have just been told by our Public Accounts Committee that if they “have the desire”, they may investigate this expenditure further. If they do proceed down this road, what does that mean? Most importantly, it allows the PAC to use their robust legal powers to summon individuals to attend committee hearings under the Parliament Act 1957. Failure to attend a hearing is contempt of Parliament and the witness’s conduct is reported to the House. Those are some strong powers. Of course, if the money transfer was of a cryptocurrency nature, it will be difficult, if not impossible to identify the recipient and therein lies the “beauty” of this new financial technology for all the cybercriminals out there.

I have a question: Why on earth doesn’t our Auditor-General, the independent watchdog of the people’s purse, have more robust legal powers? The AG’s primary job is to audit the annual financial statements of the Government and its associated organisations and to check that public funds are spent legally and efficiently.

At present, the Audit Act of 1990 does not afford the AG full “discovery” authority, such as subpoena powers, to trace questionable expenditures to their source and uncover possible political interference, corruption, theft or fraud. When the AG unearths spending issues of concern during her financial auditing process, she formally tables reports in the House of Assembly, which then turns them into public documents. Next, it will be up to the PAC to decide whether to formally investigate the AG’s findings. This long, drawn-out process increases the risk that fraud and misappropriation can occur and remain undetected.

Think about it. The AG has audit responsibilities for 55 government-controlled organisations and other entities. Based on those financials, which are often submitted years late, she completes her auditing process with, in some cases, questionable findings which then are presented to the government. Further follow-up relies entirely on legislative pressure or separate law enforcement referrals rather than direct authority of the AG.

With subpoena powers, the AG would not have to wait or beg for data and can demand it right away. The full investigative process could actually start upon discovery of such spending irregularities, the audit trail would still be warm and our public purse watchdog would finally have the expanded authority to fulfil the office mandate.

Our Auditor-General — current legal limitations

Access Restricted to Public Entities: The office has a statutory right of access to books and records inside government departments, offices, the legislature, and courts, but lacks broad investigative or discovery reach over private third parties

No Subpoena Power: Unlike supreme audit institutions in many other jurisdictions, Bermuda's Auditor-General cannot legally compel witness testimony, subpoena external bank accounts, or trace funds across international borders independently

Enforcement Gap: The office can issue recommendations and flag legal noncompliance or offences under the Audit Act, but possesses no direct power to force public agencies to adopt corrective actions

Over the years, under different administrations, there have been special AG reports on the misuse of public funds. The office of the AG has faced significant political pushback and systemic delays from the government while investigating. In some instances, it has been denied access to information which should be made available to complete these reports.

In 2017, a Bermuda Commission of Inquiry on specific findings from the AG’s reports (years 2010, 2011 & 2012), officially recommended expanding the powers and independence of the AG’s office. They recommended that Parliament modernise the Office of the Auditor-General mandate to formally introduce subpoena powers and give it the legislative teeth required to robustly investigate public spending. In 2017, the Progressive Labour Party’s election platform included exactly that, promising they would give the AG the power “to follow the money”.

I think back to the disgraceful treatment of our first appointed and longest-serving AG, the late Larry Dennis, who for 31 years held his ground against political push back. He was accused of racism, his office was raided and he was subjected to arrest and confinement, all in the quest for transparency and accountability for our public finances. He was cleared of any wrongdoing.

Mr Dennis was critical of the handling of the public purse in reports prepared under both the United Bermuda Party as well as Progressive Labour Party governments. He and every successive AG have called for consolidated financial statements for the Bermuda Government as a whole, and here in 2026, we still do not have summary financial reporting. The Government continues to make decisions without knowing the combined financial position of all the organisations that make up the Government.

Bermuda is a major global financial hub, specifically functioning as a leading offshore financial centre and a world powerhouse for insurance and reinsurance, with billions of dollars flowing through our economy. We are actively establishing ourselves as a prominent digital and technology hub. Bermuda has a strong and well-respected regulatory environment anchored by the Bermuda Monetary Authority, English common law, and high global compliance standards.

We can rightfully boast about all of this, but when it comes to our own public finances, we don’t pass muster. The government sets the highest bar for the private sector, which faces strict consequences for non-compliance regarding their financial reporting and yet, year after year, the government's own financial reporting is not on par with general international public sector accounting standards. Our government boasts about transparency, good governance and fiscal accountability, yet our Auditor-General is treated by some as an ‘irritation’ and is given limited powers to function as the watchdog of the people's purse.

Recently there was an interview with our outgoing Premier, David Burt, who was asked if he had any regrets about his time in office. He replied that it was a “personal tragedy” that he was unable to lead Bermuda to independence during his tenure as leader of the PLP.

Well, I have a regret of my own. I regret putting any faith in the PLP’s 2017 fiscal accountability pledge to strengthen the powers of the Auditor-General. This was a promise which was then swiftly forgotten upon becoming the government, thereby keeping the ‘handcuffs’ securely on the office of the Auditor-General. The PLP’s ruse worked.

BEVERLEY CONNELL

Pembroke