How cash-squeezed insurance giant bankrolled 2007 elections Sunday, June 21st 2009 |
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Well what do you know? It seems there is some serious "back scratching" going on behind closed doors. Great is the PNM! Lawrence Duprey's CL Financial Group provided scarcely imaginable largesse to the ruling People's National Movement (PNM) party in the last general election at a time when it was already on the ropes-short on cash and highly leveraged. The by-then cash-poor conglomerate bankrolled the 2007 election campaign of the Patrick Manning-led PNM party to the tune of some $20 million, according to sources, who spoke on condition of anonymity. And while much of CL's money went through a somewhat circuitous route to sundry suppliers of goods and services: from the printing of fliers and tee shirts to tent and maxi-taxi rentals, the bulk of it was applied to direct billings from advertising agencies for media activity, said sources. Some of it however, was paid directly into the party's coffers. One such payment was made directly to the People's National Movement from the group's insurance subsidiary, Clico, on June 28, 2007, for the generous sum of $5 million. The $5 million cheque, drawn from a Republic Bank-held account at Independence Square in Port of Spain, was endorsed less than a month before the November 5, 2007, vote by Rose Janierre, assistant party secretary and Linus Rogers, PNM elections officer. Look how mark bussin on ah Sunday so...what d NLCB go say!?! The $5 million Clico payout to the PNM's war chest was made at a time when the country's No1 insurance company had already been red-flagged with solvency issues, a statutory fund deficit of close to a billion dollars and what financial observers warned were dangerously excessive levels of inter-party transactions within the group. If the Manning government had any concerns about the holding company using the country's largest insurer as a lucrative little money machine, it not only kept its own counsel but it lined up at the feeding trough. Manning and the PNM truly do care after all! In the middle of this interplay of politics and business stood Andre Monteil, the then group financial director of Duprey's $100 billion business behemoth, his No1 lieutenant, party treasurer of the incumbent PNM government and the PNM face of the corporate animal known as CL Financial. Entrepreneurial titan Duprey was the other public face of CL Financial and despite his protestations of being a-political, he was viewed by many as a United National Congress or Basdeo Panday sympathiser. How shocking! Look at the names getting called up... Some say the group's fortunes rose and fell on the political connections of these two public faces of CL Financial. Whatever the truth, Duprey's CL Financial group spread a lot of wealth around the PNM in the last decade. And the point man who distributed a lot of that CL money around the ruling party was Duprey's right hand man, Andre Monteil, who, until recently, was numbered among the party's most formidable power brokers. Monteil was also the corporate chieftain who operated within the context of loopholes that allowed the CL Group to conduct business as usual in the seemingly opaque world of deficient legislation and well outside the good governance expectations of the Central Bank. In his January 30, 2009, containment effort to rescue the floundering financial giant, Governor Ewart Williams complained that the Central Bank had been "stymied" by inadequate legislation from going after the rogue insurance company. Governor Williams said that for the last five years the Central Bank was forced to watch helplessly from the sidelines as the country's No1 insurer sailed ever closer to the edge. He cited several areas of concern, including: - Excessive related-party transactions which carry significant contagion risks. - An aggressive high interest rate resource mobilisation strategy to finance equally high-risk investments, many of which are in illiquid assets (including real estate both here and abroad). - A very high leveraging of the Group's assets, which constrains the potential amount of cash that could be raised from asset sales. The Governor said that the Central Bank had consistently "focused on these deficiencies" but was stymied by the "inadequacies in the legislative framework which do not give the Central Bank the authority to demand the necessary changes". He also noted that it was a matter of public record that all was not well at Clico and that the financial crisis which forced an initial $1 billion taxpayer bailout on January 30 was long in coming. Clico's solvency problems have in fact been on the public radar for close to two decades. In 1997, a report from the then Supervisor of Insurance raised concern about Clico's inability to satisfy its statutory fund requirements for the years 1992, 1993 and 1995 and the insurer's insistence in the face of a deficit on paying dividends. The years under question were during the first Manning administration 1991-1995. In fact, Prime Minister Manning was the Finance Minister in 2007 when his party received huge sums of money from the CL Financial Group. Sources say CL was the single largest financier to the PNM's 2007 re-election campaign. A former executive at the brokerage firm of CMMB, one of the distressed finance companies owned by the CL Financial Group, told the Sunday Express that in 2007 Monteil complained that CMMB was the only board he sat on that didn't give the PNM money. In 2007, Monteil was chairman of the Home Mortgage Bank (HMB), Clico Investment Bank (CIB), the Housing Development Corporation (HDC) and the Education Facilities Co Ltd. He was also a member on the board of directors of the CCN Group, parent company of the Trinidad Express Newspapers, Home Construction Ltd (HCL) and Angostura Holdings Ltd. A CCN spokesman said yesterday that the media group made no donation to the PNM 2007 campaign or to any other party for that matter. Monteil was a co-signatory to the $2.5 million cash payment to the party in the 1995 election at a time when he sat in the Group Financial Director's chair. He later became party treasurer following the death of Anthony Jacelon in April 2005. And while Duprey may have signed off on some overly generous financing for the PNM and friends of the ruling party, sources close to him say it got him no favours. In fact, Duprey allies contend that his testimony about providing scholarship and other financial gifts to the Pandays in the Panday corruption trial had the effect of setting him in the gun sights of the then Attorney General John Jeremie. The Anti-Corruption Investigations Bureau (ACIB), a premier white-collar police unit operating under the wing of the Attorney General's office, raided Duprey's private Maraval residence and his corporate offices in what the courts later ruled were illegal searches. And as reported in an exclusive Sunday Express series detailing the sharp exchange of correspondence between Jeremie, in his first tenure at Cabildo Chambers and the then Director of Public Prosecutions Geoffrey Henderson, now a High Court judge, Jeremie, in 2006 attempted to pressure Henderson into bringing criminal charges against Duprey and Panday, the then Opposition Leader. Well look at bacchanal now! The cat get pulled out of the bag, kicking and screaming! If this is not enough reason to jail every man jack in the PNM, I really don't know what is! |
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