Audit reveals irregularities in K-Park flats deal
The findings highlight systemic issues that have contributed to a seven-year delay, financial losses, and legal disputes for affected parties.
An internal audit by the Housing Development Corporation (HDC) has revealed significant irregularities in awarding and executing the contract for the K-Park Residences project in Hulhumale.
The findings highlight systemic issues that have contributed to a seven-year delay, financial losses, and legal disputes for affected parties.
In 2016, the contract for constructing high-end apartments under the K-Park Residences project was awarded to South Korea’s Hanbo Company Pvt Ltd. However, progress has been slow, with the apartment complex remaining incomplete seven years later.
Additionally, allegations of fraud have emerged against Hassan Mamdhooh, a shareholder in Hanbo. He has been charged with fraudulently selling several apartments from the unfinished project. These fraudulent transactions and project delays have resulted in significant financial losses for many individuals, leading to numerous civil suits for damages.
The internal audit sheds light on multiple issues, including procedural lapses and potential conflicts of interest:
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Insufficient Qualification Marks: Hanbo Company Pvt Ltd failed to meet the minimum criteria during the re-evaluation of the bidding process, raising questions about how the contract was awarded in the first place.
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Conflict of Interest: HDC employee Abdul Nafiu, who played a role in the project evaluation, has reportedly been involved in joint business ventures with Mamdhooh. Together, they have formed several companies under different names to promote the K-Park project.
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Lack of Oversight: Nafiu has since been transferred to another department within HDC, but the findings underscore inadequate oversight and due diligence in the project’s initial stages.
These findings were included in a report by the State-Owned Enterprises (SOE) Committee of parliament, following a motion by Galholhu North MP Mohamed Ibrahim.
HDC has confirmed that the primary contractor, Hanbo Tech Korea, remains committed to completing the project, now scheduled for 30 March 2025. However, the board has authorised the cancellation of the contract if this deadline is not met.
The main contractor, Hanbo Tech Korea, has distanced itself from the controversies, stating that the disputes involve its former local agent, Hanbo Maldives. The agreement between the two entities has since been terminated, and the South Korean company has assured stakeholders that construction will proceed without further interruptions.
The delay in delivering the K-Park Residences has had far-reaching consequences for buyers, many of whom have lost significant investments and are pursuing legal recourse. The HDC audit underscores the need for transparency and stricter oversight in public-private partnerships, particularly in projects of this scale.
