CLICO handed US$40M bill, wants to verify before paying

Sep 19, 2017 News

The Bank of Guyana has recently handed representatives of Colonial Life Insurance Company (CLICO), a bill of the amount of money the company owes Guyana. Kaieteur News understands that the bill stands at just over US$40M.

Central Bank Governor, Dr. Gobind Ganga

However, CLICO officials are not convinced that that is the true likeness of the outstanding cash.
CLICO officials yesterday told Kaieteur News that they only recently received the invoice. They indicated that the invoice only reflected the money owed to the National Insurance Scheme (NIS) and the accumulated interest to date.
However, CLICO is contending that that cannot be the amount of money owed based on the fact that government took control of all its properties left behind in Guyana when the company went belly up back in 2009.
CLICO representatives are claiming that the government is holding over US$30M from the sale of the company’s assets. One official said that he was quite taken back at the fact that there has been no liquidation report. He learnt of this after requesting for same.
CLICO said that that it would like to examine a procedure that is equally beneficial to both parties to verify how the Bank of Guyana arrived at that figure.
A few months back, CLICO’s Lawrence Duprey returned to Guyana with an investment plan saying that he wants to apologize to the people of Guyana and to repay what he owed. But many are still incensed about the way Guyana was treated.
Attorney at law and Chartered Accountant, Christopher Ram, said that a simple apology and a promise to repay are not good enough. The government should demand more based on respect for its people.
Ram said that Duprey acted dishonorably in the past and should not be accepted with open arms.
A few months back, Minister of Finance, Winston Jordan, met with Duprey. A statement from the Minister’s office indicated that Duprey wants to “renew his relationship with Guyana as well as publicly apologize to its people for the collapse of CLICO Guyana”.
While Jordan committed to further meetings and the statement from his Ministry carried a somewhat accepting tone towards Duprey, Ram thinks that the government ought to take a firm stance.
”That man should be declared persona non grata until he returns all the money that he so improperly and unlawfully took out of Guyana,” said Ram.
Ram said that before allowing any investments, government should secure a concrete guarantee from Duprey that Guyana will be compensated.
The financial analyst said that Duprey should not be made only to give back to Guyana what was left outstanding eight years ago. “We want to recover the economic loss, not only the financial loss,” said Ram.
To do so, Ram noted that Guyana can apply “a proper rate of exchange and a proper rate of interest and on that basis, we will determine what it is we have lost as a result of his breaching the laws of Guyana.”
Duprey is interested in investing in several areas here, including providing solar energy at competitive prices, affordable housing, clay brick and solar technology for housing, as well as introduce a financial model that will generate savings and alleviate poverty, the statement from the Ministry of Finance said.
Last year, Government announced a $5.6B long-term financing for NIS to help the entity recover its investments in CLICO. Jordan had stated that going to court to recover the $5B-plus for NIS may be useless.
He emphasized that the sad reality is that the CLICO situation might very well turn out to be a long drawn-out process, as Guyana is not even on the radar when it comes to the settlement process in the Caribbean as yet.
”So Government is going to have to step up to the plate and find another way of recouping the losses for NIS in this regard.” Jordan had referred to the situation as another “mess” inherited from the PPP/C administration.
Government, in 2009, seized local properties from CLICO in Guyana to help pay policyholders, after it became clear that the regional insurance giant was in dire financial problems. Some 7,744 policyholders were paid a total of $4.1B.
One of the properties that NIS received was the one on Camp Street where the current headquarters of the Guyana Revenue Authority is located.

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