EMBD invested $54M in annuities in name of Uthara Rao

The Estate Business Management Development Company (EMBD) invested about $54 million in two insurance annuities with CLICO in the name of its former Executive Chairman, Uthara Rao. And there is no evidence that the board of the state company approved the transaction.

That was revealed Tuesday during a sitting of the Public Accounts and Enterprises Committee of Parliament.

The State-owned company was incorporated in 2002 to manage and secure the lands owned by Caroni (1975) Limited. Its mandate included stimulating new business. Rao, who was a controversial figure during his tenure, quit his post in 2009.

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Committee Member Subhas Panday asked EMBD's new Chairman, Krishendath "Joe" Ramkissoon and Acting CEO Keith Gray to explain why two Executive Flexible Premium Annuities (EFPA) worth $54.4 million were signed in Rao's name.

Gray stated that it was not standard practice for such a transaction to be conducted. He added that both policies were rolled over in October 2008, noting that the company unsuccessfully tried to tried to end the contract in 2009 but CLICO then asked that they be rolled over again.

Gray said EMBD asked CLICO to pay the interest earned from the plans but that did not happen.

Opposition member Colm Imbert said the EMDB's financial records show that the annuities are now in the name of the company and asked Ramkissoon if the company plans to sue CLICO for its money.

Ramkissoon indicated that the company intends to recover the money from CLICO. 

"It is quite likely that we will have to engage a professional in the area of forensic auditing to get through these things because a lot of these things are now coming before the board now. We are very concerned about it," Ramkissoon said.