The National Audit Office on the NSM case: – Never encountered anything similar

The National Security Agency (NSM) took out loans in violation of the Constitution and the Ministry of Justice and Emergency Response did not follow up well enough. This is confirmed by the National Audit Office in a new report.

– This is a very special case. The National Audit Office has never come across anything like this. It is already known that NSM has gone far beyond its powers, but the Ministry of Justice and Emergency Management has also not followed up the situation in NSM well enough. Both parts are worthy of criticism, says Auditor General Karl Eirik Schjøtt-Pedersen in a press release.

The reason why the National Audit Office entered the case was that NSM borrowed NOK 200 million illegally at sky-high interest rates and unfavorable conditions. 140 million was to be repaid, among other things, with almost 10 percent interest.

The company that lent the money, Norwegian Property, is controlled by John Fredriksen.

Sofie Nystrøm, who was director of the National Security Authority, resigned on the day the case broke in the media.

The National Audit Office reacts to this

The National Audit Office concludes that the loan agreement is a breach of the Constitution, and that the follow-up from the Ministry of Justice and Emergency Preparedness has been criticised.

They conclude that:

• NSM has taken out loans without the Storting’s consent and in violation of the rules for grants.
• NSM has not disclosed the loan obligations in its own annual accounts.
• Neither the Ministry of Justice and Emergency Preparedness nor the NSM have informed the National Audit Office about the loan obligations.
• The Ministry of Justice and Emergency Preparedness has not sufficiently followed up NSM’s move to new premises and the lease agreement in its agency management meetings.

Frølich: – Deserved criticism

Leader of the Storting’s Control and Constitution Committee, Peter Frølich, believes the criticism in the NSM case is deserved.

– The Conservative Party believes this deserves criticism from the National Audit Office. The Ministry of Justice and Emergency Management has not had good enough control over NSM, he says to NTB.

– We expect Justice Minister Emilie Enger Mehl to take the criticism to heart and follow up on the National Audit Office’s conclusions, continues Frølich.

This is how the ministry responds

In an email to Aftenposten, the Ministry of Justice and Emergency Preparedness writes that they have made the same assessments as the National Audit Office.

“The department is in the process of following up on the recommendations. Monthly agency management meetings are held with NSM on the development of internal control and financial management. The National Audit Office receives minutes from these meetings on an ongoing basis.’

They also write that the standards for accrual business accounting in the state will be adopted from the turn of the year at the latest.