Guyana’s greatest financial scandal

Apr 06, 2009 Features / Columnists, Peeping Tom

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Mrs. Janet Jagan is dead. She should be allowed to Rest in Peace and not become the object of political diversion or attempts to use her name to purge the PPP.

All her life she was made the political scapegoat by her detractors. She does not deserve to be part of any process which would be in direct contradiction to her record of facing up to problems and keeping her party intact.

Right now there are individuals bent on deflecting our attention from the mess they have put this country in because of their courtship of CLICO (Guyana).

They would wish for us to be distracted from the greatest financial scandal that has ever hit this country.

Each day and with each earth- moving revelation this scandal keeps getting ranker and ranker. It now stinks to the high heavens.

I am calling for the opposition in this country to assemble a national debate on this issue because the government is continuing to cloud this issue with a lot of talk about their guarantee.

A guarantee or no guarantee, explanations are required of how the National Insurance Scheme invested so much in CLICO (Guyana), how the company could have been allowed to move this money outside of Guyana in breach of the insurance laws, why a Special Prosecutor has not been appointed to charge those involved, and why was the company allowed to sell its bonds in the Berbice River Bridge when that money could have been used to secure part of the NIS investments in CLICO (Guyana).

These questions are not being answered. Instead we are being given assurances and excuses.

One of these excuses is that the State has taken over the company. The State has not taken over the company. There has been a move towards judicial administration of the company and this is quite different from a State takeover of the company.

There has also been a defense of the continued employment of Ms Geeta Singh- Knights. No less a person than the President has said that her institutional memory is what allowed the government to challenge the classification of the monies that were sent to the Bahamas.

We did not need institutional memory for that. We need to see the annuities and to verify that these are authentic because the Liquidator in the Bahamas is saying that what he is seeing amounts to inter- company loans rather than policies of insurance.

There is also a lot of talk about what the government is doing to recoup the losses. We have heard for example about the order from our Courts restraining BOSAI from paying monies owed to sister companies of CLICO (Guyana).

The government feels that since the companies within the CLICO group are interrelated, that this freeze on monies owed to these companies by BOSAI can help reduce Guyana’s exposure. And so there is glee about the injunction granted against BOSAI from paying monies to Trinidad.

The injunction is however at this stage just temporary and Guyana should not be celebrating so early. BOSAI did not borrow from CLICO (Guyana).

They borrowed from another CLICO company and it is for the Courts to decide whether this temporary order should become absolute and whether Guyana is entitled to receive monies that BOSAI owes to Trinidad.

The government is going to a great deal of extremes to freeze payments to CLICO so that they can secure the monies that are owed to Guyanese.

They have also secured an injunction against Caribbean Resources Limited and another CLICO affiliated company from disposing of their assets.

They are doing all of this to ensure that Guyana can recover its losses and thus be able to pay the policyholders of CLICO (Guyana).

The government is going to this entire extreme to ensure that there are assets to secure the investments of Guyanese in CLICO (Guyana). Yet quite ironically, the same PPP government did not object to the sale of the bonds in the Berbice River Bridge. These bonds formed part of the assets of CLICO (Guyana) and the government should have stopped this sale so that these assets would not have been disposed of.

Just before the move towards judicial management, CLICO disposed of its shares in the bridge. The government knew at the time that CLICO (Guyana) was in problems.

They knew that the sale of the bonds in the bridge would not end the company’s problems.

They knew that the NIS had billions sunk into the company and yet they did not object or prevent the sale of the bonds.

The sale went through and the monies were used to pay those who made a run on CLICO (Guyana) just before the move towards judicial management.

Now the same government which allowed CLICO (Guyana) to sell off its bonds in the bridge wants us to believe that they are protecting the interests of policyholders by seeking an injunction preventing BOSAI from paying back monies it owes Trinidad.

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