Opposition MP Kamla Persad-Bissessar on Monday accused Finance Minister Karen Nunez-Tesheira and Central Bank Governor Ewart Williams of insider trading. She said both of them withdrew money from CLICO Investment Bank (CIB), after learning of the bank's imminent collapse.The Siparia MP was speaking in Parliament on a debate on two bills: the Insurance Amendment Act, 2009, and the Central Bank Amendment Act, 2009.
In presenting the bills to the lower House Nunez-Tesheira said the pieces of legislation are necessary because of Government's decision to bail out the CL Financial subsidiaries.
Persad-Bissessar accused both officials of pulling out their money based on insider information and demanded that Prime Minister Patrick Manning to inform the nation “which public official withdrew money, using insider information before the CLICO crisis.”
She suggested that Manning should halt his forensic probe of the Cleaver Heights Housing Project and put Bob Lindquist on the case "to investigate which ministers and government officials withdrew money from the CIB and from the CLICO Group with prior knowledge."
Nunez-Tesheira did not deny the claim except to say, "I did not use any privileged information to my advantage." Persad-Bissessar asked Nunez-Tesheira a direct question: did she or did she not withdraw money from CIB in January just days before the Government bailout was announced. She did not respond.
Reporters pounced on the minister during a break in the sitting and she said she would respond in winding-up of the bill.
For his part, Williams denied that he used any insider information to his benefit. But in a statement he admitted that he had "two small deposits" with CIB and cashed in one of the deposits on maturity on December 27, long before CL Financial approached the Central Bank for help.
The statement said "The other deposit is still with CIB up to this time...I will insist on being given the same treatment as all other depositors".
Persad-Bissessar added more to the story. She said CIB's collapse was accelerated by a decision by State-owned National Gas Company (NGC) to pull out $3 billion in CIB and create a run on the company. She claimed that it was a deliberate move "to bring down CLICO to its knees."
Manning added his own intrigue, pointing fingers at Opposition leader Basdeo Panday. He suggested that the former prime minister might be reluctant to allow the Government to have access to the books of the CL companies and wondered if the assets of Colonial Life would include an apartment in Kensington in London. "I am asking the question. I don’t know,” Manning said.
Panday's daughters lived in that apartment but there is no evidence that it is owned by the Pandays. CL Financial's Chairman Lawrence Duprey provided Panday's daughters with scholarships while Panday was prime minister.
An angry Panday shot back: "An apartment in Germany," a reference to unproved allegations that Manning received a gift of a property in Germany. Panday also shouted that he is checking on Manning's dealings with Calder Hart, the executive chairman of UDeCOTT.
Commenting on the business matters of CLICO, Manning said the company's current liability is between seven and eight billion dollars. He added that the company found itself in the current predicament because of “mismanagement.”
Manning said a UNC activist and councillor, who is also an insurance agent, made a deposit of up to $3 billion in CLICO Investment Bank on behalf of NGC.
"They did it in such a way that an agent of CLICO who is a friend of theirs and one of their councillors came into a substantial quantity of money by way of commission," he said, noting that the commission was more than a million dollars.
He charged that MPs Ramesh Lawrence Maharaj, Dr Roodal Moonilal and Dr Tim Gopeesingh also knew of the matter.
All that came out of the UNC's accusation that the government showed double standards in shutting down the Hindu Credit Union (HCU) while bailing out CLICO when the circumstances of both financial institutions were similar.
In response Manning said he knew that issue would have surfaced in the debate because the UNC always resorted to ethnicity. But what neither Manning nor Panday spoke about is that a substantial percentage of the shareholders and depositors of the HCU do not belong to the ethnic group to which Manning referred.
Earlier in the debate Panday claimed that the Government is seeking to take over CLIOO, not bail it out. He charged that once the Parliament approves the legislation the Government would move on CLICO and fire 20 per cent of its staff.
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