In a brief statement today, the company’s judicial manager, Deloitte Consulting Limited, said it had been left with no other choice but to “wind-up the company by way of liquidation in the absence of funding for the implementation in Barbados of the first phase of a regional restructuring plan for CIL.
“No funding has been made available to date and consequently, the Judicial Manager has no alternative but to act on its August 25th, 2014 recommendation to move towards liquidation,” the three-paragraphstatement read.
The development comes in the wake of Cabinet’s approval last April of a Barbados Government-led restructuring plan for the cash-strapped insurance company, which was slated to take effect by the end of this year.
Today’s announcement by Deloitte drew an immediate angry reaction from the president of the Barbados Investment and Policyholders Alliance (BIPA) June Fowler, who in an interview withBarbados TODAY said the liquidation move would result in “vast losses to policyholders”.
She also expressed disgust that both present and past Governments had failed to follow through on promises made to thousands of policyholders over the course of the near six year CIL debacle that was triggered by the February 2009 collapse of its Trinidadian parent company CL Financial.
“[This] finally proves beyond a shadow of a doubt that [CLICO] undertakings, whether verbal or in writing, given by the Prime Minister, his Ministers, or the Cabinet of Barbados are completely worthless and should not be relied upon by anyone at home or abroad for any purpose,” said Fowler.
“I am sickened by the fact that both the late and current Prime Ministers in person, subsequently backed up by the Cabinet, would lead tens of thousands of policyholders down the garden path . . .despite the fact that it was their own agencies which failed to act when CLICO, headed by prime ministerial ‘pal’ Leroy Parris, consistently breached the Companies Act and the Insurance Act . . .behind the backs of the policyholders,” she added.
Also describing the situation as a scandal, Fowler said BIPA would shortly be publishing details of the judicial manager’s reports and forensic reports.
She said BIPA would also file for the release of the latest forensic report “as evidence in its civil action so that the public of Barbados will finally understand what has been going on unchecked under the noses of the authorities”.
Cabinet had earlier approved recommendations for the judicial manager to begin the process of implementing the final recommendations contained in the report and addendum presented to the High Court.
This was expected to lead to, among other things, the creation of a new insurance company (NEWCO) to take over the insurance business by yearend, along with the creation of separate entities, which would own the real estate and other illiquid assets as a first step towards the overall restructuring of CIL.
In October, Minister of Finance Chris Sinckler said the Barbados Government was prepared to come to the rescue of the collapsed insurance company having recognized that it was in need of funding.
However, that plan has apparently now been shelved.
Efforts to reach Sinckler for comment tonight were unsuccessful.