Karen: Wrong to pay CLICO directors

She was commenting on CLICO’s decision to pay more than $63 million to former directors, inclusive of their companies and connected parties.

Based on my information of what is in the Bob Lindquist forensic report on CL Financial, which the Government and the Governor of the Central Bank have copies of, there is absolutely no way from a legal or moral perspective that they should have made those payments,? stated Nunez-Tesheira who was finance minister at the time of the CL Financial collapse in 2009.

Recalling that it was the Central Bank which commissioned Lindquist to do a report on CL Financial, she said the report demonstrated that the persons running the company did a number of things which did not benefit the policyholders and which caused the policyholders to be in the position that they are today.

So what you are doing (by paying the former directors) is rewarding them for alleged wrongdoing,? Nunez-Tesheira stated.

She pointed out that, significantly, the report of the Commission of Enquiry into CLICO and HCU, chaired by Sir Anthony Colman, had not been made public, after two years.

She hypothesised that Government had not released the report because it would make the payments to the former directors even less justifiable.

Some of the people who benefitted (from payments) were those who chose to pay the $2,000 (penalty for failure to appear) rather than attend the Commission of Enquiry, she said.

Until those persons have been cleared of any wrongdoing, no monies should be paid to them,? Nunez-Tesheira stated.

She noted that the former Governor of the Central Bank (Ewart Williams) had taken key members of CL Financial under civil proceedings in 2011.

I don’t know what has become of those proceedings,? Nunez-Tesheira said.

This Government has used some sort of rationale, based on the policy statement that they created, to make payments and that is going against the spirit and intent of the MOU (Memorandum of Understanding signed in 2009), she said.

If you look at the Central Bank Act, one of the provisions is basically that people deemed to be responsible for the demise or financial difficulties of a company cannot be allowed to benefit and that at least such benefits can only come at the very end when everyone else has been made whole,? Nunez-Tesheira said.

She stated further that when the Central Bank Governor was given authority over insurance companies, by virtue of the amendment of the Central Bank Act in 2009, a policy was drafted with respect to the definition of third parties in keeping with international standards. I understand that this Government crafted a new policy and it seems to me, based on the names called, those are persons who seem to be associated with this current Government. And one has to wonder whether this new policy was deliberately crafted to be able to pay these persons money, something which cannot be right under any circumstances. There can be no justification for this, she said.

Nunez-Tesheira said Government was also being opaque over the amount of money it received in profits from the CL Financial companies.

You (the Government) are only telling us about how much it cost (to bail out CL Financial). Tell us how much revenue the Government has obtained from the Methanol company, from Republic Bank and other companies since 2009, Nunez-Tesheira stated.


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