 |
| Harry Harnarine, former HCU President |
He added that no one of the auditors from PricewaterhouseCoopers (PwC) has been able to find a reason for the withdrawal.
Glasgow said a liquidator found only $89,000 in all of the bank accounts bearing the name of the HCU. Glasgow, who is the lead counsel to the enquiry, spoke about the cash withdrawals Monday when he re-examined Ernst & Young partner Maria Daniel.
Glasgow said Daniel's firm prepared a "report advising the directors (of the HCU) of the unsatisfactory state of affairs in the number of cashed cheques that were being drawn to cash". He said she confirmed that the $78 million was taken out and that a report to that effect was written. She also admitted that she did not conduct research to find out where the money went.
Farid Scoon, attorney for former HCU president Harry Harnarine, told the commission "the whole board was insulated from cheque writing and that part of the operation".
Daniel suggested during her testimony on Monday that a "forensic audit" is needed into the HCU. "It will be able to substantiate movement of funds that may have taken place. It will go back to bank accounts. At the end of the day cash is fact," Daniel said.
Liquidator Ramdath D. Rampersad also gave testimony on Monday. He was appointed liquidator of the HCU on the October 9, 2008.
Senior Counsel Fyard Hosein, representing the Ministry of Finance, questioned whether the record-keeping was "a deliberate attempt to have chaos".
Rampersad said many of the files for about 7,000 loans in the HCU could not be located. He also gave a breakdown of some of the important issues he unraveled after he made a preliminary assessment of the HCU's "financial and operational status":
Glasgow said a liquidator found only $89,000 in all of the bank accounts bearing the name of the HCU. Glasgow, who is the lead counsel to the enquiry, spoke about the cash withdrawals Monday when he re-examined Ernst & Young partner Maria Daniel.
Glasgow said Daniel's firm prepared a "report advising the directors (of the HCU) of the unsatisfactory state of affairs in the number of cashed cheques that were being drawn to cash". He said she confirmed that the $78 million was taken out and that a report to that effect was written. She also admitted that she did not conduct research to find out where the money went.
Farid Scoon, attorney for former HCU president Harry Harnarine, told the commission "the whole board was insulated from cheque writing and that part of the operation".
Daniel suggested during her testimony on Monday that a "forensic audit" is needed into the HCU. "It will be able to substantiate movement of funds that may have taken place. It will go back to bank accounts. At the end of the day cash is fact," Daniel said.
Liquidator Ramdath D. Rampersad also gave testimony on Monday. He was appointed liquidator of the HCU on the October 9, 2008.
Senior Counsel Fyard Hosein, representing the Ministry of Finance, questioned whether the record-keeping was "a deliberate attempt to have chaos".
Rampersad said many of the files for about 7,000 loans in the HCU could not be located. He also gave a breakdown of some of the important issues he unraveled after he made a preliminary assessment of the HCU's "financial and operational status":
- Only $89,000 was available in all the bank accounts in the name of the HCU
- $3.1 million owed to the Board of Inland Revenue in respect of PAYE (pay as you earn) and health surcharge
- $1.6 million owed to the National Insurance Board in respect of contributions deducted from employees' salaries
- $598,000 in unpaid salaries for HCU employees who were terminated as at 17 July, 2008
- $191,000 owed in land and building taxes
- "Substantial amounts" owed to utility providers (TSTT, T&TEC, TTPost and WASA)
- HCU had several loans it was not servicing including
- $35.2 million loan from CLICO at a rate of 10 per cent per annum
- US$2.5 million loan from SR Projects Ltd at rate of 12 per cent per annum
- US$4.8 million loan Eximbank at a rate of 10 per cent per annum
- $7 million overdraft from Intercommercial Bank at a rate of 15 per cent per annum
- $3.5 million loan from Intercommercial Bank at a rate of 11.5 per cent
- US$53 million owed depositors from judgments
- No audited accounts prepared subsequent to September 30, 2005
- Over 50 per cent of the loans granted by the HCU were delinquent. This amounted to some $59 million
- The HCU should not have paid dividends in 2004 and 2005
- The HCU financial complex is a fire hazard and failed OSHA tests
- The Regional Corporation cannot locate the file of the HCU multi-million-dollar "megaproject" Pine View. No planning approval
- Depositors funds were used to buy land in Florida from Harnarine's brother, Seepersad
- Harnarine's sister reimbursed $34,000 for a trip to Walt Disney
- $17.5 million paid to businessman Mohan Jaikaran for a television station but rights not transferred
- $27.9 million paid to HCU marketing personnel Gordon James for construction and janitorial services
- The HCU and CLICO, two of the entities that are the subject of this commission of enquiry, also entered a $200 million asset swap
- The HCU's convention centre was mortgaged to CLICO as part of the transaction
Harnarine's lawyer complained that Ernst & Young had been "unfair" in investigation and subsequent report into the HCU. He asked for an opportunity to submit his witness statement to the enquiry on Tuesday morning.
No comments:
Post a Comment