‘Stashed funds’ from GNCB debt recovery part of parallel treasuries

Apr 15, 2014 News

… Finance Minister will answer questions- Opposition
Monies collected by the Guyana National Cooperative Bank (GNCB) debt recovery unit will have to be accounted for. Alliance for Change (AFC) Leader, Khemraj Ramjattan and A Partnership for National Unity’s (APNU) point man on Finance, Carl Greenidge, plan to grill Finance Minister Ashni Singh about monies which they say are “stashed” in revenue streams that the government is operating as “parallel treasuries”.

The Opposition says that Finance Minister Ashni Singh will come under intense scrutiny

The now privatized GNCB is said to have recovered some $4B from borrowers after its closure. However, instead of the revenue being placed in the Consolidated Fund as required by law, it was secretly placed into an account at the Guyana Bank for Trade and Industry.
The information, Ramjattan said, is not unknown to the Opposition and the Finance Minister will have to explain this, like the many other state funds that are tied up in other revenue streams instead of being placed in the Consolidated Fund.
According to Article 216 of the Guyana Constitution, all revenues or other moneys raised or received by Guyana shall be paid into and form one Consolidated Fund. The GNCB funds are more of state funds being excluded from the Consolidated Funds and thus does not come before the Parliament. This, Ramjattan continued, is more state money that has also been excluded from the National Budget, but “the Minister will have to deal with this.”
The Opposition members said that the GNCB issue came to their attention when questions could not be answered about where the money went. In the meantime, Greenidge said, more investigations are being conducted into the matter, but the government side will have to say where the people’s money is going.
Keith Burrowes is the General Manager of the GNCB, but several telephone calls to him and Mr. Brassington were unanswered.
In his budget debate presentation last week, Ramjattan spoke extensively about the parallel treasuries in which the government has skillfully “stashed” state funds instead of putting the money into the Consolidated Fund.
Ramjattan said that cuts to the budget were already made since all revenue streams are not accurately reflected. “If we put all revenue streams in the budget we would have lots more; it is in the vicinity of $50B cut, since before being laid here, monies are being hived off to accounts that belong to certain bodies,” Ramjattan had stated.
He charged that the Guyana Forestry Commission had a balance at the end of last year of $1B, but this was never placed in the Consolidated Fund. GGMC held $12B while the Lands and Surveys Commission held $365M, but those amounts too were not placed in the coffers.
Ramjattan went on to the Guyana Civil Aviation Authority having $742M, the Central Housing and Planning Authority $2.7B, the lotto funds having $1.1B and NICIL hoarding some $9B.

APNU Shadow Finance Minister Carl Greenidge

Ramjattan said, “These bodies have government monies or what is called public money, some $27.7B that is not there.”
There is also the issue of the GNCB Trust. Executive Director of the National Industrial and Commercial Investments Limited (NICIL) Winston Brassington was the Head of NICIL when it acquired the Guyana National Cooperative Bank (GNCB) Trust. NICIL then sold the GNCB Trust to Hand in Hand Insurance Company and in 2003, the insurance company passed a special resolution to change the name of the new asset to Hand in Hand Trust Corporation.
However, Brassington had come under fire when his brother became a major shareholder in the company, and he (Brassington) still being at the helm of NICIL, with inside information, signed on behalf of his brother. NICIL was also a major shareholder in the company with 250,000 shares while Hand in Hand Fire Insurance Company had majority shares.
In 2009, the Board of Directors at Hand in Hand Trust Corporation, “authorized an increase in the Trust Corporation Share Capital from $250M to $750M and further authorized the issuance of Preferred/Ordinary Shares to cover the increased Share Capital.”
The Trust had therefore increased its shares from 2.5 million to 7.5 million at $100 per share and immediately, Jonathan Brassington bought 2.25 million shares for $225 million, giving him a one-third ownership in Hand in