Investors in CLICO should agitate

Apr 14, 2009 Letters

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Dear Editor,
I had decided not to comment on the CLICO (Guyana) fiasco before because of two reasons:
• There is more to come out; and
• This is a matter that is engaging the attention of the Court.

However, an article by an investigative journalist in Trinidad Ms Camini Marajh caught my attention and unveiled some strange occurrences that happened in the Group that I felt must be shared in understanding the mindset of some people:
1. Mr. Louis Monteil, the former second in command of Mr Lawrence Duprey made TT$6 million from a controversial acquisition of one of Mr. Duprey satellite companies after buying and selling it back in a short space of time in 2007;

2. The entire purchase was funded by debts from the Group and the sale paid for in cash to the beneficiary. In simple terms this means that the Group unjustifiably funded a cash transfer of wealth to a private individual leaving an unsecured debt in the books of the Group.

3. These people now have the audacity to state that the Board of Directors approved these transactions and they cannot speak about these things since they have signed a confidentiality agreement with Mr. Duprey.

4. Now Mr. Monteil is saying he will not comment on anything since he does not want his business in the papers. Since when is an alleged ‘ripping off’ of the public a private affair? These people have brought all Boards of Director in the Caribbean into disrepute and that is a heavy professional burden they must bear.

5. Mr. Monteil further told Ms Marajh, “I am out of the game. Leave me alone”. Why don’t he pay back to the Group the unjustified gains he made by methods that are far from above board. This is called naked financial aggression from where I stand and only then can he be left alone.

6. Mr. Dupery has confessed to the journalist that he is a dreamer of deals and leaves the details to other people. Speaking from Miami, he further told this journalist that “his life is not Trinidad”. He further stated that as far as he is concerned “Trinidad is behind him and he is moving on”. This is the most reckless form of leadership there is. He basks in the glory when the going was good but moved on when things turned sour.

In summary, there are a few lessons we all can learn from this CLICO affair, since I am sure there are a few hare brain schemes still alive in Guyana:
When it comes to money, everyone is in this game for himself – period! There are no friends in the money game.
In the money game, we must never take anyone’s word at face value since a personal guarantee from a supposedly man of wealth and power, like Mr. Lawrence Duprey is not even worth its weight. I can recall that Mr Duprey was the investor who was trying to put DDL, a well run Guyanese company in 2004, out of business. In April 2005, at a Cabinet outreach in Berbice, our President, Bharrat Jagdeo was quoted by GINA as follows:
“We went to a tender process and Angostura has won that tender, but DDL has gone to court to try to block it, which I think is totally ridiculous from the perspective that they want to tell GUYSUCO to whom they should sell the molasses and at what price,”
Well in introspection, DDL saved Guyana from Lawrence Duprey. (I would advise all to re-read the SN article on this issue)

We must dig and ask the hard questions when investing our money. When the sales people “sweet talk” with all the rubbish about if you do not invest today, you can lose on the rates, immediately walk away and say you need more time and information and ensure you read the fine print before you hand over the cheque.
Making money the old fashion way is always the best – slow but sure and any “hare brain scheme” to generate fast return, even from supposedly reputable organisations, must be approached with caution.
I would advise Guyanese to distribute their saving by opening saving accounts with all the banks and the NBS. All of financial institutions in Guyana cannot fail at one time.

I personally have avoided depositing money in insurance and other quasi financial companies and so far it is a strategy that has paid off handsomely because I have not one cent in neither CLICO nor Globe Trust.
When a sales person tells you the Board of Directors approve their ‘hare brain’ scheme, it means nothing since the CLICO fiasco has revealed that Corporate Governance in the Caribbean is under threat. The Governments of the region with advice from the Caribbean Institute of Chartered Accountants must actively revise their respective Companies Act to further protect the stakeholders.

As the days progress, the misery for the depositors, annuity holders and insurance claimants of CLICO (Guyana) may increase unless a Government guarantee is formally in place.
With this Government guarantee, CLICO (Guyana) will become the safest insurance company and thus I would encourage clients to continue to pay their premium.

I would encourage the investors in CLICO (the teacher’s union, GAWU, etc) to agitate for a formal Government guarantee to protect their members.
As the taxpayers of the Caribbean fund the gap in the balance sheet of the CLICO affiliates the creators of this mess sip their cocktails in their luxury mansions in Miami.
It is a shame that the USA can convict their Madoff and ours is allowed to continue to live a life of luxury.
Sasenarine Singh

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