On Friday 30th January 2009, the CL Financial (CLF) bailout started, so today – 30th January 2019 – is the ten-year anniversary of that fateful decision to commit Public Money to bailout the Caribbean’s largest conglomerate. The companies which were to be bailed-out were: CL Financial Ltd (CLF); Colonial Life Insurance Company Ltd (CLICO); Caribbean Money Market Brokers Ltd (CMMB); Clico Investment Bank (CIB) and British American Insurance Company (Trinidad) Ltd (BAICO).
The mismanagement of this bailout has exceeded any mismanagement which led to the collapse of CLF, that is my view.
The bailout proceeded between 30th January 2009 and 12th June 2009, with over $5.0 Billion in Public Money paid to CLF in that period, under the terms of the Memorandum of Understanding (MoU) signed between then Finance Minister, Karen Nunez-Tesheira, and Lawrence Duprey, then CLF’s Executive Chairman. That MoU governed the expenditure of this vast sum of Public Money before the 12th June signing of the CLF Shareholders’ Agreement. All of which calls into question the continued claims, in relation to the Tobago Sandals project, that MoU’s are non-binding. As we say here, is according.
There has been an incredible escalation in the cost of this bailout, from the initial estimate of $5.0 Billion, to the present expenditure exceeding $25.0 Billion. This has been a source of serious concern as priority was given to pay the claims of the CLF creditors over other urgent, public needs.
This is an update on my efforts to get the remaining details of the CL Financial bailout in which over $25 Billion of our scarce Public Money has been spent.
Although the details of over 13,200 EFPA claimants who received $10.823 Billion were provided, the Consent Order entered in the Appeal Court on 24th January 2018 has not been fully complied with. The Ministry of Finance is now claiming that the CL Financial accounts relied upon by then Finance Minister, Winston Dookeran, in preparing his 3rd April 2012 affidavit cannot be found. Also missing in action is the list of creditors of CL Financial. I am challenging that non-compliance with the assistance of my attorneys.
After ending the lawsuit in January 2018, I made further requests for information from the Finance Ministry so that we could have all the details of all the payments made in this bailout. Those requests have now escalated to the stage that I have filed a new lawsuit under the Freedom of Information Act (FoIA) for the refused details. Continue reading “CL Financial bailout – closing the circle”→
On 18th April 2018 I published ‘Integrity Query’ in this space on ‘the apparent failure or refusal of The Commission to carry out its duties in relation to CLF as required by the Integrity in Public Life Act (IPLA)‘. My 10th September 2012 complaint to the Commission that it had not been performing its duties in relation to the Directors of CL Financial had seemingly vanished, with no real reply to be had.
Then, on 6th August 2018, The Commission gave its written response to my 2012 complaint. That brief reply stated that The Commission considered all available information relevant to my complaint and concluded that those directors were not governed by the IPLA – a further statement was made that CL Financial and its subsidiaries, including CLICO remained a private company in which the Government (sic) had a minority shareholding. (See embedded letter below.) This article delves into that entirely unacceptable reply and its meaning. Continue reading “CL Financial bailout – Evading Integrity”→
This article summarises the total Public Money spent on this CL Financial bailout and also outlines some further concerns.
CLF BAILOUT PAYMENT SUMMARY
Interest & Finance
Services & Supplies
Source – Correspondence with Finance Ministry PS
Various payment summaries and the CL Financial Management Accounts (unaudited) for 2015, 2016 and 2017 were provided thus far in response to my requests for information of 4th May 2018. Notwithstanding those details, the Ministry is yet to respond substantively to my requests, so I have instructed my attorneys to take the necessary steps to settle this request for information.
In January 2009, this bailout started with a $5.0 Billion estimated cost. In October 2010, we were told that $7.3 Billion had been spent and that a further $7.0 Billion was needed to pay all the claims – a total of $14.3 Billion. A compilation of the Ministry’s summary data, on which I am relying, show a total of $25.95 Billion in Public Money spent at this stage, taking no account of unsatisfied creditors.
This Season is one of reflection and re-dedication for me, with the two-month transition from Emancipation Day on 1 August to Independence on the 31 August, then onto Republic Day on 24 September. I always spend this spell in some sober reflection, in between the life. It seems to me that the very sequence of events and the consequent holidays in the season imbue it with an inner meaning in terms of a national transition to some kind of depth and purpose. Emancipation to Independence to Republican status…this is my Season of Reflection, maybe that is just sentimental of me, but let us see.
This was published on Emancipation Day 2018, as we start the Season of Reflection. Sober reflections as one tries to close the gaps.
This summarises the reply of Ministry of Finance PS Dhanpaul on 14th June 2018, to my original request of 24th April 2018. Dhanpaul wrote that the Ministry –
had no details of legal fees as the lawyers were not retained by them;
had no CLF audited accounts from 2008 to date, but management accounts for 2015, 2016 and 2017 were sent;
denied my request for the presentation made to Independent Senators in September 2011 on the grounds that since we had agreed to omit that item from the Consent Order my request was ‘an abuse of the process of the court‘. In any case the file could not be located.;
Legal and other advice was being obtained on the outstanding items;
Further letters were to be sent via hard-copy, other formats would be ignored.
From – Afra Raymond
To – Vishnu Dhanpaul
Date – Fri, Jun 22, 2018 at 7:42 PM
Hello PS Dhanpaul,
I have carefully considered your reply of 14th June 2018, the overall tone and content of which is perturbing, given the background in this matter.
My reply is itemised here for ease of reference –
The group accounts for CL Financial – Thank you for providing the management accounts of CL Financial Limited as at December 31st 2015, December 31st 2016 and April 30th 2017. Of course the 2015 accounts show balances for 2014, so what is the document from which those 2014 numbers were derived? My original request was for ‘…audited accounts of CL Financial Limited…to include interim, preliminary, draft, unaudited or management accounts…‘. Those broad request terms were submitted precisely to allow for the related matters of opening balances and source documents to be accommodated. In light of that, please provide the set of accounts from which the 2014 balances were taken, whatever the permutations in which those might appear. Also, please provide the available accounts for the outstanding years – 2008 to 2014 – whether those be interim, preliminary, draft, unaudited or management accounts;
Legal Fees – Please reply to indicate which Ministry or State Agency had responsibility for retaining and paying the attorneys who represented the Ministry of Finance in these two court case – I find your answer to be verging on the obtuse;
Presentation to Independent Senators made in September 2011 – The consent order of 24th January 2018 in no way affects that this document is disclosable – indeed, the Ministry’s 22nd January 2018 Supplemental Submission set out a clear position, which accepted that there are no applicable exemptions in the FoIA to prevent publication of the presentation made to Independent Senators in September 2011. Its twelfth paragraph states – “…As to the Order in relation to Request No. 2 the Appellant’s position is that it accepts that there is no exemption on which the Appellant can rely…” For your information, a copy of that document is hyperlinked above for ease of reference. In the circumstances, the Ministry’s position is risible in that even if one accepts its position, which I do not, any other applicant would be entitled to obtain the document without that defence being available. In any case, a presentation of that importance would have been the subject of considerable email traffic, which means that there would have been drafts and attachments exchanged between the Ministry and its advisers – those email records need to be examined for those documents. Your suggestions as to an abuse of process are quite misplaced and somewhat ironic, given my next point;
The outstanding items – The issue of the details of the costs of the CL Financial bailout was litigated since March 2013, with the Ministry having lost at the High Court in July 2015 and conceded defeat at the Appeal Court in January 2018. What could possibly be your rationale for seeking further legal and other advice on these requests? This series of requests for information is being made to the same Public Authority in respect of the same bailout process, the only material difference being that the information being requested now was not previously requested. This series of requests is being made, in the public interest, to obtain the outstanding details of exactly how this bailout was funded. By way of illustration and for the benefit of other readers, take the case of a request for information under the FoIA which sought certain details of applicants for certain state training with names from A-F. In that example if the application was refused, then became the subject of judicial review, then the High Court ruled in favour of the publication and the State conceded its case at Appeal Court level, how then could the State refuse a subsequent application for the same details of applicants for the same training program with names G-Z? It is my considered view that for a Public Authority to be seeking further legal and other advice in such a situation would be tantamount to an abuse of process. I am stating that for the benefit of any other readers who might be unclear as to the important principle at stake in this matter. I have no doubt that you fully understand the issues as stated. Quite apart from the commitment of scarce public resources to obtain further advice on this matter, please note that the Ministry is now beyond the 30-day deadline specified at S.15 of the Act to indicate whether it is refusing or approving my requests;
Communication – I reject your proposals as to our future communications. At this time, the vast majority of my communications are via email, possibly 95% – I have little doubt that the ratio is any different at the PS level of our public service. In these circumstances, what could possibly be your rationale for proposing the hard-copy mode for our further communication? In any case, all the Ministry’s letters in this current exchange are being delivered to my office, notwithstanding the typed address being my home.
I await your early reply so that this long-outstanding matter can be properly concluded, in the public interest and without any further delay. For the avoidance of doubt, please do not take this correspondence as in any way representing my acceptance of your delay, now well outside the time-limit stipulated in the Freedom of Information Act. All my rights are hereby reserved.