Canada Loyal Financial reported to be coming to rescue CLICO
There was a report in the local press on the weekend that Canada Loyal Financial is interested in bailing out CLICO. The policyholders have been emitting noises of quiet optimism since the announcement. Some of us however are alarmed a foreigner stands to own a significant acreage of our lands. If Canada Loyal Financial is able to acquire CLICO it makes a mockery of the government stated claim that it bought the old Heywoods property was in the national interest. At this point we can only speculate on the Nation newspaper report.
Today is the 30th of January 2014: five years since the State bailout of CL Financial was announced to a shocked nation and region. It is necessary to mark this moment in time with solid facts and stern meditation.
The Carnival season is upon us, so J’ouvert is near the front of my thoughts. J’ouvert is simple, yet tremendous, because of the experience of passing from night into daylight and of course those around you becoming clearer as the light overcomes the darkness. For me, the defining feature of Jouvert is the terrifying portrayals of ‘Devil mas‘ in its various forms – ugly and dirty, covered with mud, oil or paint; real noisy, beating pitch-oil tins and such; forceful, in demanding payment from you before you could pass. You have to pay the Devil to go away. Pay the Devil, so he could leave without dirtying you up.
Fruendel Stuart (r) Owen Arthur (l) Photo: Nation Newspaper
Noam Chomsky opines that “it is the responsibility of intellectuals to speak the truth and to expose lies”. It begs the question do we have intellectuals in Barbados? Who are they? BU adds another question to the pile – is there morality in local politics?
During the last general election Prime Minister Fruendel Stuart was portrayed as a man of integrity when compared to Owen Arthur. Whether one agrees who won the integrity vote Stuart did not object to the comparison. One year later BU believes Stuart has fallen short of being a man of integrity. Before the political cackle begins it is instructive to lookup the definition of integrity, “the quality of being honest and having strong moral principles; moral uprightness”. Did Prime Minister Stuart and his Attorney General Adriel Brathwaite now appointed admit that they witnessed unsavoury (illegal) events during election day? The Prime Minister promised he would check every election law on the books and bring the matter to parliament to prevent recurrence and in the process finger the culprits.
On another front BU is reliably informed that the government had been in discussion with the NUPW to send home workers for several weeks before the recent announcement. One must reasonably conclude that Prime Minister Fruendel Stuart – who is the minister responsible for the civil service had to be aware of the decision to retrench workers a long time before it was announced. Remember when the SmartStream system was blamed by Stuart as the reason why temporary workers were not paid? We subsequently found out that temporary workers are not registered on this system for payroll. The decision to send home workers was not arrived at overnight. During the time the discussions were being held the Prime Minister suggested there was a computer glitch when many public officers complained about not being paid. We hesitate to call Prime Minister Stuart a liar BUT he has been less than transparent about government’s position on the tenure of public servants.
When judged against the harsh background of adversarial politics, only two prime ministers of Barbados (who led the country for 7 years or more) can lay claim to being able to escape the clutches of the IMF for the entire period of their rule – Errol Barrow and Owen Arthur.
Say whatever you will, it is an undeniable fact that Barrow and Arthur were able to utilize whatever resources they had available at their disposal without plunging the Barbadian economy into disequilibrium. This achievement in itself represents a public demonstration of their political and economic skills. One was from the DLP, and the other is from the BLP, but we must commend and applaud both of them equally for distinguishing themselves in this regard.
Borrowing, taxation, and easily accessible NIS funds were the main resources available to Barrow, Arthur, and all Ministers of Finance. Naturally these resources varied in amount as administrations came and went.
By the time the David Thompson administration assumed office in early 2008, the world had changed drastically. Volatility and uncertainty had become so widespread that the Governor of the Central Bank informed and warned all Barbadians that the macroeconomic models used to analyze and predict outcomes under the “old” economic order, were no longer applicable.
It seems Barbadians have forgotten about CLICO and all the promises but what have we learned from the collapse? How have we sought to strengthen institutional capacity as a response? Is the Financial Services Commission (FSC) doing a job? Should Barbadians be privy to the sealed judicial report? What about those who were involved with CLICO Barbados and continue business as usual?
Afra Raymond’s journey in Trinidad covering CL Financial matters should serve to inspire others. This piece is recommended reading.
I am responding to the points made by Central Bank Governor, Jwala Rambarran, in his 6 November speech to the T&T Coalition of Service Industries.
This speech attempted to both re-affirm the Central Bank’s important role in our economy -
…as the country‟s prime financial regulator, the Central Bank has an almost fifty year record of maintaining the safety and soundness of the financial system…
and to distinguish Rambarran’s tenure as Governor since July 2012 -
…These are just a few of the initiatives the Central Bank has been working on over the last fifteen months to rebuild confidence, strengthen financial stability and to help create our future financial system…
Rambarran’s focus was “…First, “How did it all happen?” and, second…“What is being done to prevent a similar event from happening again?…”
Afra Raymond chats on the show ’Forward Thinkers‘ with David Walker on 104.7FM, dealing with the CL Financial bailout and my lawsuit against the Minister of Finance to get at the detailed information as to how the $24B in Public Money was spent. 24 October 2013. Audio courtesy More 104.7 FM
In the business section of BBC of 19 June 2013 there was a headline Deloitte gets one-year New York ban. In the world of global finance it represented a routine report given the vagaries of how business is done today. Then it dawned on the author to question – why is it regulators in Barbados are never driven to censor the entities which they regulate? Is the corporate climate in Barbados so principled as to avoid the censure from those with oversight?
Then there is the association to be made between Deloitte, who is the Judicial Manager of CLICO and PriceWaterhouse (PWC), who acted before as external auditors for CLICO Barbados. Why have we not been asking robust questions of PWC? It seems all of the focus has been directed at Leroy Parris, and yes he should be held to account given his fiduciary role. However, if we want to fully prove what led to the demise of one of the largest privately own conglomerates in the Caribbean, we need to cast the net far and wide.
His Excellency Sir Elliott Belgrave GCMG KA CHB QC
BU listened with interest to DJ and others at Voice of Barbados (VOB92.9FM) extending best wishing to Senator Tony Marshall on his appointment to the Upper Chamber of the Barbados Parliament as an Independent Senator. BU on the other hand withholds all plauditory remarks until Tony Marshall shows respect to the public he pretended to serve while he was #1 afternoon talk show host and Chairman of the important National Insurance Scheme.
Some will see the irony of Senators Marshall and Byer-Suckoo being members of that Chamber in the current term. It was the then Minister Esther Byer-Suckoo who refused to renew Tony Marshall’s appointment to the National Insurance Board. The usually loquacious Tony Marshall has not issued a public statement that we are aware of on the matter. There was rampant speculation at the time on BU about the ‘optics’ he would have exuded as Chairman of the NIS Scheme given his former role as a director on the CLICO Board. There was the other camp who believed it had to do with matters arising from the NIS on again off again decision to fund the problem plagued Paradise Beach Development Project (Four Seasons Project). Whatever the reason the public, taxpayers, are none the wiser.
Tony Marshall given his roles to date BU regards him as a person of public interest and we are within our right to place the former banker under the microscope. As the #1 talk show host in Barbados he never used the VOB92.9FM bully pulpit to speak out about CLICO from an insider perspective. Contrast his position with Tony Hoyos who resigned on principle from the Barbados National Bank Board (now Republic Bank) to express his disagreement at the time about the share price government was willing to accept from RBL (how this matter finally was settled is fodder for another blog).