The other foot falls

Feb 28, 2009 Editorial

On Thursday CLICO (Guyana) was placed, in the words of President Jagdeo, “under judicial management”. Unlike the analogous situations in Trinidad, where the Governor of the Bank of Trinidad and Tobago made the announcement, or in Bahamas, where the Office of the Registrar of Insurance Companies issued a statement (even though Bahamas Prime Minister, Hubert Ingraham, is also the Minister of Finance), our Head of State chose to announce the denouement of our instalment in the CLICO saga.

We wonder if this was a signal by him that he is dissatisfied with the performance of those of his administration who had direct responsibility for oversight of the failed entity.
Be that as it may, without a scintilla of doubt someone drawing a state salary dropped the ball on the CLICO affair. As we wrote in our editorial back on February 9: ‘For whom the locks click’, we were not surprised at the “self-serving” statements of Ms Geeta Singh-Knight of the local CLICO that “CLICO (Guyana) remains solid”, but found her “warrants…amazing”.

We specifically pointed out: “Firstly, in light of the conceded complex and interlocking nature of the CLICO’s conglomerate, such blanket disavowals fly in the face of statements by Mr Ewart S. Williams, Governor of the Central Bank of Trinidad and Tobago, that one of the major reasons for CLICO’s denouement was “excessive related-party transactions which carry significant contagion risks”. It strains one’s credulity to accept that a company that treated its insurance as a cash cow to finance its aggressive programme of growth would leave cash in Guyana sloshing around.
What has the CEO said about its short-term fund being $82M in the red, or the billions invested in and owed by several CLICO affiliates?

The question now is when did the Commissioner of Insurance (COI) move to secure the “billions invested and owed by several CLICO affiliates”, by which we were referring to the massive investments in the Bahamas affiliate and Caribbean Resources Limited (CRL)?
The President is asserting that “immediately” after the January 30 action by T&T the Government sought and was provided with information that “showed considerable exposure to the Group, in particular to CLICO (Bahamas)”.

But in the same sentence the President claimed that the COI long knew of this investment that had (incredibly!) violated the law on the amount of assets that CLICO could have invested outside the country.
There was also, of course, the other tip-off sign that not all was well in the fiefdom of CLICO (notwithstanding Ms. Singh-Knight’s bravado) in the contradictory recording of the $6.9 billion investment in the Bahamas affiliate, on theirs and the local books.

To now say boldly that the COI’s instructions for CLICO to “reduce this exposure” was ignored for over a year reflects badly both on our regulatory enforcement and the COI.
In our follow-up editorial of the following day, we asked most pointedly: “Where is the breakdown in enforcement located?” Pointing to the emergency Parliamentary session in T&T to enact legislation to plug enforcement loopholes, we queried: “What is the state of our regulatory scheme over the insurance and other non-bank financial institutions?”
We would still like to know whether it was a lacuna in the law that prevented a more vigorous and timely intervention.

Another bit of information that Guyanese would like to be revealed is whether the officers and staff (and/or their relatives) of CLICO or members of the Government eased out their assets from CLICO just before or during this month.
We know that this malfeasance occurred widely in T&T. Also if, as the President had assured us earlier, CLICO was being monitored rigorously over the last month, why was it allowed to sell such a huge chunk of assets as the $2 billion investment in BBCI to NBS?

Was this in the best interest of the pension funds invested in CLICO that the Government now announces it seeks to protect?
Finally, after explicitly announcing that CLICO (Guyana) had ‘no investments or dealings with sister companies’ when summoned by the Minister of Finance immediately after the debacle was revealed in T&T, should Ms Geeta Singh-Knight remain as a Director of GuySuCo?

Latest News

The other foot falls

Related

Similar Articles

The Glenn Lall Show|| February, 10th, 2025

Follow on Tik Tok @Glennlall

THE BLUNT OF THE DAY

Sports

Khalil, Pollard and Barker reign supreme as BCQS Int’l Masters...

Cricket West Indies passes historic governance...

Archery Guyana hosts thrilling 2024 National...

Prashad claims victory at the recently concluded...

West Indies & Sri Lanka top their respective...

Allicock, Amsterdam named in GBA training squad...

Features/Columnists

Are we better off today than we were before first oil?

OAS Secretary General Election and renewed OAS Consensus

Corruption – at epidemic proportion

Publisher’s Note

Weekend Cartoon

Bridge Watch

Demerara Harbour Bridge

> Berbice Bridge […]

The other foot falls

Share this:

Related

Similar Articles

The Glenn Lall Show|| February, 10th, 2025

Follow on Tik Tok @Glennlall

THE BLUNT OF THE DAY

Sports

Features/Columnists

Publisher’s Note

Weekend Cartoon

Bridge Watch

Demerara Harbour Bridge

> Berbice Bridge […]