Post Cabinet Briefing Summary – Thursday 28th April, 2016

The Prime Minister, Dr. the Honourable Keith Rowley and the Minister of Finance, the Honourable Colm Imbert, made statements during the Post Cabinet Press Briefing today (Thursday 28th April, 2016) at the Office of the Prime Minister, St. Clair, Port of Spain.

At the briefing the Prime Minister, Dr. the Honourable Keith Rowley, addressed allegations made in an article in last week’s Sunday Express titled “HDC houses for Special Branch cops * – Officers probed Emailgate and Prisongate”.

Prime Minister Rowley called on the relevant authorities to thoroughly investigate and prosecute these matters accordingly and for persons to be held accountable as part of the catharsis that is required in Trinidad and Tobago.

Also during the briefing, the Minister of Finance addressed statements made in an article in today’s Guardian newspaper and clarified some existent confusion regarding the bailouts to Colonial Life Insurance Company (CLICO) and CL Financial Insurance.

The article referenced correspondence from Mr. Lawrence Duprey to the Minister of Finance. Minister Imbert confirmed that he was copied in a letter from Mr. Duprey to the Governor of the Central Bank of Trinidad and Tobago dated March 22nd, 2016. In the letter, Mr. Duprey had asked for consideration to be given to a plan that would essentially allow him to retain/recover control and management of the company or to have a role in the divestment of the CLICO assets.

The Central Bank replied to Mr. Duprey explaining that, because Colonial Life Insurance had been taken over by the Central Bank (under Part 6 of the Central Bank Act using the emergency powers), they were unable to treat with him.

Reference is also made to a letter addressed to Minister Imbert (dated March 23rd) in which proposals regarding the way forward for CL Financial were presented. That matter is currently engaging the attention of the technocrats and advisors in the Ministry of Finance and an appropriate response to the letter will be agreed upon in due course.

Minister Imbert noted that many of the details with respect to the takeover of Colonial Life Insurance (CLICO) and the agreement between CL Financial and the Government have been shrouded in secrecy over the last five (5) years and that there have been a number of variations and extensions to the agreements.

The following details were noted:

– There have been sixteen (16) extensions to the shareholder’s agreement between CL Financial and the Government of Trinidad and Tobago.

– Former Minister of Finance, Mr. Larry Howai, entered into an agreement (dated may 24th 2013) with Mr. Roger Duprey, representing the United Shareholders Company Ltd, with respect to the disposal of the company’s (CL Financial) assets and a way forward. This document states that the Government has advanced, by way of financial support to the affected subsidiaries, approximately 19.6 billion dollars. However, based on discrepancies between this agreement and the information that is in the public domain, there is still some confusion.

– The Central Bank, which has taken over the Colonial Life Insurance Company (CLICO), is responsible for the disposal of the company’s assets in order to repay CLICO’s creditors, which include the Government. According to the latest update, CLICO owed the Government of Trinidad and Tobago approximately 16.9 billion dollars. The Government has been repaid 4 billion dollars from the proceeds of the sale of the MHTL Methanol Company and the current balance owed is 12.9 billion dollars. The Central Bank has presented the Minister of Finance with a proposal for the recovery of outstanding monies which the Minister will take to the Cabinet for approval. Once Cabinet agrees, the Central Bank will then be granted the authority to proceed with its plan to recover the residual balance still owed by CLICO to the Government.

Minister Imbert announced that he will be conducting a full forensic audit to establish the facts – exactly how much money was put into the bailouts of Colonial Life and CL Financial and its subsidiary companies, how much has been repaid and how much is owed so that the Government can make its best effort to recover as much money as possible.

The Minister of Finance reaffirmed that the current Government simply desires to recover the money owed to tax-payers – not to take over any managerial roles in the companies involved.

Minister Imbert noted that the present confusion may stem from CL Financial – of which the Government received and now owns 14% in exchange for the debt. Other shareholders include Mr. Lawrence Duprey (approx. 22%), the Cyril Duprey Trust (approx. 25%) and several smaller shareholders.

The United Shareholders Group has been working together with the previous government, combining shares, to control 51% of the company and its subsidiaries. Minister Imbert suggested that confusions may be as a result of the realignment of all these disparate shareholders.

The Minister of Finance asserted that the Government will protect the public interest and do what is required to deal with this matter and welcomed any of the stakeholders to submit creditable proposals to repay monies owed to the Government.

Articles referenced:

Alexander, Gayle: “Duprey angry at CLF mishandling… “I’m not to blame for this fiasco’” – The Trinidad and Tobago Guardian – http://www.guardian.co.tt/news/2016-04-28/duprey-angry-clf-mishandling-%E2%80%98i%E2%80%99m-not-blame-fiasco%E2%80%99

Javeed, Asha: “HDC houses for Special Branch cops * – Officers probed Emailgate and Prisongate” – Trinidad Express newspapers – http://www.trinidadexpress.com/20160423/frontpage-slider/hdc-houses-for-special-branch-cops