Once again, the information flow on this fiasco is so erratic that one has to wonder if that is intentional. We not so easy to destabilize. Madam Minister, it is our taxpayers’ money that you are spending, so the time to account is now.
In the history of our region’s development, it is my view that this episode is arguably the most shattering failure – economically, financially and regionally – in living memory. It is important to distinguish this from externally-propelled events since it is Caribbean people, principally from our country, who were the architects and engineers of the CL Financial empire. We are the driving force in this fiasco, both those who designed and built the seductive savings and retirement plans, as well as those who invested with CLICO/CL Financial. Those who designed the fancy car and those who got on for the ride. Those who did not take the fancy ride are being asked – no, told! – to help those people injured in the crash of the largest and fanciest ride on the road. We are very kind people and it is never any problem to help those who are in need, but please don’t tell us that the ‘driver lost control of the vehicle’. Time to change gears and shift our thinking. Who is our leader?
Some of the important aspects of this situation are –
- CL Financial letter – The CL Financial letter of 13th January which requested urgent financial assistance from the State has never been published. Yes, that is the appeal signed by Mr. Duprey 3 days before dividends were paid on 16th January. We have never even been told why the letter has not been published. It is no excuse that these items of correspondence are never normally published. The sheer size, financial consequence, political linkages and regional impact of the CL Financial failure are all sound reasons to declare this an exceptional case to the extent that a new standard of transparency is required. That 13th January letter is obviously part of the public record yet it is not available. Why is that Minister? Could it be that that letter contains information which reveals too much about the true background to this tangled affair? Madam Minister, what is your interest in further secrecy on this aspect? The atmosphere is heavy with claims, counter-claims and, most oppressive of all, the scripted silence of the chiefs. It is my view that your continued concealment of this vital document is only going to feed an unhealthy degree of skepticism, which is already present in this sorry affair, for reasons we are all too familiar with.
- The new MoU – We are told that a new agreement was signed with CL Financial on Tuesday 2nd June. I have been unable to get sight of that agreement but there are reports that the State has now taken control of the troubled group. What are the terms of that agreement? Does CL Financial have assets sufficient to cover their liabilities? Is there an option to call on the assets of the CL Financial Directors and Officers to settle any shortfall? When can we expect the new MoU to be published?
- The Dividend – We have heard the Minister attempt a rebuttal of the parliamentary allegations she faced on early withdrawals of her various CIB deposits and the potential conflict of interest issues. Minister, we have that part of your message, even if only a few of us have accepted your version. That is all part of public life, but what we are not hearing from you is any statement on the CL Financial dividend. You are a noted attorney and former lecturer at the Law School in UWI, so what is your learned opinion on the payment of dividends by an organization which was unable to pay their financial obligations in proper priority? Am I asking an improper question? Are we, as a country with ambitions of becoming an International Financial Centre, going to let these shareholders keep their dividends in this failed group? That would be a real shame and completely incompatible with our stated ambitions. Minister, your continued silence on these aspects of the fiasco of the century will only increase the clouds of suspicion and disrespect now swirling through the public mind.
- CLICO’s new business model – The newly-appointed Chairman of CLICO, Dr. Euric Bobb, has made recent statements on the development of a new business model for CLICO. The recovery of this company will face challenges from the departure of key sales agents; the withdrawal of their high-return products, which were CLICO’s unique selling point; and of course, the missing $5.0Bn from the CLICO Statutory Fund. It did not help that the new board released a high-profile series of advertisements in February which went to pains to assure the public that it was ‘business at usual’ at CLICO. That is absolutely the last message they could, or should, have been wanting to send. The CLICO model is what put us into this mess and the new board should have been making efforts to point out that they would not be repeating the errors of the previous CLICO chiefs.
- The Court case – We are still no wiser as to why on earth is the CL Financial legal battle being fought in closed court. Someone must have applied to have the hearings closed: I wonder who? And why? You see, the fact that the hearings are closed means that we are forced to rely on ‘leaks’ to see only part of the story. Of course, that is only the part the person leaking would like us to see. So we need to have those hearings opened to ensure a good quality of information. Even beyond that burning concern is the recent reports that the High Court has made an order to prevent the State from using information in this case for criminal cases. No doubt that order was obtained at CL Financial’s request, but what is the thinking underlying the ruling of the Court on this aspect. I would like to hear some better explanation of that.
- The last days – I believe that a full, public investigation of this entire sorry fiasco is vital, if we are to learn all its lessons. I am not entirely sure if a Commission of Enquiry is the way to go, or if another form of investigation can also be effective here. For example, I would have liked to see the Arthur Lok Jack School of Business undertaking some extended studies on this. It would be very interesting to see a list of those who broke their investments/fixed deposits in the Group in the last 90 days. That would be very instructive.