Last week I wrote about the Code of Silence observed by our ruling class. I gave examples to support my idea, but there was not enough space to mention everyone.
The Bankers Association of Trinidad & Tobago (BATT) and the Association of Trinidad & Tobago Insurance Companies (ATTIC) are also part of the situation.
We have a long history of our rulers making huge, stupid, destructive decisions without any commitment to transparency or accountability. That lack of transparency is what allows corrupt to flourish. We can never eliminate corruption, but if we are serious about reducing it, we need to proceed differently.
Maybe, just maybe, this is the kind of colossal event which could force some of us to drastically change our ways, despite the positions we now assume. This is a moment of national peril and the continued observance of the Code of Silence is going to cost our country plenty money.
As it is, we already have been bound to a rotten bailout of the wealthiest individual in the Caribbean by our Treasury at ZERO interest. Anybody looking to set up a small business has to face the bank and pay interest. None of that for Lawrence Duprey and the CL Financial chiefs. They have been able to enrich themselves and when the entire thing went wrong, they were able to negotiate a handsome handshake for themselves and then leave the mess for our government to clean-up.
That is the plain meaning of the bailout. Is not policyholders we bailing-out, is the richest, smartest characters in the country. The bailout script is unfolding so well that almost the entire discussion is now about the fairness/unfairness of the government’s position with respect to retired policyholders etc.
Real Anansi antics.
The CLICO Policyholders Group (CPG)
There was an EFPA group and a CLICO Policyholders group formed just after the budget on 8th September, but they soon merged under the latter name. I am now seeing what appears to be a substantial split with 2 competing meetings being organised for 10am today – one in Port-of-Spain and the other in San Fernando.
The CPG group has been very successful at getting their views known and making the media circuit, with the eventual meetings with the advisory group set up by the PM.
The main concern being advanced by the CPG is for the recovery of the funds deposited with CLICO and there has been no reply whatsoever to the point that, despite its labelling, the EFPA was largely sold and understood as a deposit. The accounting rule of thumb as to ‘substance over form‘ in interpretation is an irrefutable part of the debate on this, but CPG have been silent on this point.
Almost all the many people with whom I have discussed this issue, have been very plain in their language – ‘I had my money deposit with CLICO‘ and so on. But the word Policyholder is more likely to attract sympathy, so the games continue.
We already spent $7.3Bn in cash since the bailout was announced. Please note that nobody is even talking about how the State is going to recover that loan. The only talk is about how are they, the depositors, going to recover their monies.
There is a real principle of financial equity being shredded to pieces in the conduct of this bailout and it was disappointing that Mr. Dookeran, as an Educator in the field, did not take the opportunity to expand on this.
The intent is plainly to deprive the Treasury of its limited funds so that the assets of 15,000 people can be preserved.
So, What about those negotiations?
When the Prime Minister spoke on 1st October, she created an advisory group (headed by Minister of Food Production, Vasant Bharath) to meet with the policyholders to seek other options.
The Prime Minister was to meet with concerned persons and activists on Wednesday 7th October in Chaguanas, but that meeting was cancelled at short notice, with no alternative dates given.
What we are left with is lengthy, secret meetings to discuss the review of the bailout terms, with no concrete information emerging. That secrecy is totally unsatisfactory. It smacks of secret deal-making and does nothing to inspire the confidence which is supposedly the very purpose of this exercise.
The last regime, with all of their noble intentions and devout Ministers, lost their way in a morass of muddled purposes, secret deals, mixed-up with misleading and false public statements from the highest office in the land. We all know how that ended. The question is whether we have learned anything from that bitter experience. The Peoples’ Partnership were the main beneficiaries of those PNM errors, have they learned from that?
Our money is being spent on this massive exercise and it is not good enough to emerge from these closed meetings with agreed phrases like ‘constructive or meaningful’. This emerging pattern speaks of disrespect for the acumen of our people.
To re-state my equation:
Expenditure of Public Money – Accountability and Transparency = CORRUPTION
Imagine these bold-faced people declaring that when they are done and settled, the terms will be announced to us who paying for the whole thing. The first sign of a bad marriage is when the husband is the last to know – some say, the wife. But the main point is that the public cannot be the last to know.
The simple and painful fact is that public confidence in our leaders is at an all-time low. The time-honoured notion that a leader is someone wiser, more mature, less reckless and of overall higher ideals has been tested to destruction by events. In this particular case, it is easy to understand the charged atmosphere, hence the need for extra ventilation and transparency.
I was recently emailed by a well-meaning group asking that I start setting out some ideas of how CLICO might be rescued and I had to remind them that without basic information, all we can do is argue emptily with each other. All to the amusement of the masterminds of this, the greatest economic crime in our nation’s history.
I was even ‘phoned, while writing this, by an acquaintance who is a leading member of the CPG to join him and an un-named UK guest in a TV studio on Monday morning to discuss all this. Yes, I dismissed the request – too much secret-thing for my taste – and challenged the caller to name the person, supposedly a top UK expert.
What would be ‘constructive and meaningful’ would be to publish these long-outstanding reports so that we in the public can inform ourselves on the vital issues –
- The original Duprey letter of 13th January 2009.
- The audited accounts of the CL Financial group for the years ending 31st December 2008 and 2009 – Have PwC completed that? When are they to be published?
- The Mottley Report – There was a team of three advisers – Wendell Mottley, Colin Soo Ping Chow and Steve Bideshi – appointed to examine the CL Financial group and we need to know what were the findings of this group.
- Given that we are being asked to bailout and clean-up Mr. Duprey’s crisis, I feel we need to be told the names and details of those who benefitted from the $7.3Bn paid out so far, as well as those details for the borrowers of the $1.0Bn of ‘non-performing loans’ in CIB’s portfolio.
- Finally, we also need to have the position of the CLICO Policyholders’ Group published. What exactly are they claiming?
We have seen reports in the press about the very long Cabinet meeting on Thursday 21st at which the CLICO issue was said to be part of that agenda.
It would be totally unacceptable for a deal to be sealed without properly informing us, the taxpaying public, as to the true background.
The People’s Partnership has already distinguished itself, positively, by announcing Commissions of Enquiry into the attempted coup in 1990 and the Financial collapse (CL Financial and HCU). This is no time to get diverted into back-room deals.
I am working for betterment and from you, our elected rulers, I expect better.
2 thoughts on “CL Financial bailout: These Turbid Times”
Lopsided development if we gee dem what they want, when they want it.
The Trinidad Express Editorial Tuesday 26th Oct 2010
The Trinidad Guardian Editorial Tuesday 26th Oct 2010
Both show that the wider media are finally, maybe, just beginning to eye the shadow of this colossal CLF problem. More than just accountability, wrong-doing and right of redress; we have also the matters of fit use of public $$, the legacy issues and the obligations of the State. All these are finally disturbing…
T&T is so small that surely many persons now hiding inside policyholders groupings giving ultimatums to the State are also professional persons who are members of ICATT. Very interesting. We note also that Selwyn Ryan was adamant in his view last year and before the elections of May 24th this year that the State ought not to bail-out CLICO. He did not agree that CLF was too big to fail. However, now that the State has proposed a schedule of amortization – which isn’t an outright loss and is actually a kind of government bond so it can be the basis of credit and transfers (including inherited wealth) – now, Ryan thinks there is a problem. The problem is that folks have no right sense of how long it actually takes for any group or any but very large institutions to ACCUMULATE 10 or even 5 billion.
The cost of an accelerated payment is the lopsided development of the rest of the responsibilities of State. Like the Republicans in the USA, these people don’t so much want their money back now as they want something else…
The Government of Panama is investigating British American.A criminal investigation into bankrupt British American insurance company is now focused on local banks to discover how $19 million were transferred out of Panama.
A source linked to the investigation said the investigation could result in charges being levied for the filing of a fraudulent bankruptcy.
Complaints have been filed by a group of affected depositors and the Superintendent of Insurance. Both have been consolidated into a single criminal investigation.
Shortly before declaring bankruptcy, the company transferred $19 million out of Panama to Trinidad and Tobago.
The authorities estimate that approximately 21,000 customers were affected by the bankruptcy.
Deposits worth $9 million are sitting in The National Bank of Panama, but creditors would receive only a fraction of what they are owed if additional funds can’t be recovered.
Prosecutors are seeking assistance from authorities in Trinidad and Tobago, to certify that the funds were transferred to that country and to establish whether they can be recovered.