Andre Monteil featured prominently in the 2009 annual report of Transparency International (TI), which put Trinidad & Tobago at 72 out of 180 nations in its perception of corruption index.
"When not properly regulated, overlapping directorships leave state resources and private shareholder equity vulnerable to allegations of manipulation and insider dealings," the report stated.
It pointed to the March 2007 case of Stone Street Capital, which paid TT$110 million (US$17.8 million) for over 40 per cent of the shares of Home Mortgage Bank (HMB), which is partly owned by the state.
At the time of the purchase, Stone Street Capital co-owner André Monteil was chairman of both HMB and the privately owned Colonial Life Insurance Company (CLICO) Investment Bank, which sold the HMB shares to Stone Street Capital.
That became a national scandal when the matter was raised in Parliament in April 2007 by a member of the opposition who pointed out that Monteil’s leadership positions with all three companies involved created a conflict of interest or led to insider trading.
Monteil’s role as treasurer of the ruling People’s National Movement (PNM) also raised ethical issues about the purchase. The case was further complicated by suggestions that financing for the private purchase of HMB shares was supported by public funds.
"In 2007 a member of the opposition alleged that, in February of that year, CLICO Investment Bank accepted a deposit of TT$100 million (US$16.5 million) from the Housing Development Corporation (HDC)," the report said.
"Monteil was chairman of both institutions and because the deposit occurred a matter of weeks before CLICO sold HMB shares to Monteil’s Stone Street Capital, some speculated that the HDC deposit to CLICO Investment Bank gave the bank sufficient liquidity to be able to lend Monteil’s Stone Street Capital the money to pay for the HMB shares," the report stated.
It said a review conducted by The Ministry of Finance "discovered no evidence of wrongdoing in the sale of the HMB shares...Additionally, the central bank concluded that the trade met the conditions established by the revised Home Mortgage Bank Act."
It said, "The prime minister brushed off suggestions of impropriety surrounding the HDC deposit to CLICO Investment Bank, stating that it was a short-term deposit of TT$60 million (US$9.8 million) made only to earn interest."
Transparency International noted that in June 2008 police confirmed that the case remained under investigation by the Anti-corruption Investigations Bureau, "though no findings have been forthcoming".
It said, "Such treatment gives credibility to the suggestions of one parliamentarian that Monteil’s ranking among the ruling party effectively exempted him from government scrutiny."
The organization said, "The government’s failure to address the implications of highly overlapping directorships undermines public trust and threatens the integrity of the state."
It added, "If overlapping directorships continue to be a facet of Trinidad and Tobago’s public and private enterprises, the door remains open for conflicts of interest to tempt those in positions of power to abuse their status for personal gain."
It acknowledged that closing that door to overlapping directorships could put to rest some public suspicions of executive misconduct, but at the same time admitted that such a move may not be possible in the small Trinidad and Tobago market.
"What is possible, however, is for the regulatory framework to be reformed to require enterprises with overlapping directorships to exercise much higher standards of transparency and accountability," it concluded.
One of the issues raised in that report was the problem of overlapping directorships.
"When not properly regulated, overlapping directorships leave state resources and private shareholder equity vulnerable to allegations of manipulation and insider dealings," the report stated.
It pointed to the March 2007 case of Stone Street Capital, which paid TT$110 million (US$17.8 million) for over 40 per cent of the shares of Home Mortgage Bank (HMB), which is partly owned by the state.
At the time of the purchase, Stone Street Capital co-owner André Monteil was chairman of both HMB and the privately owned Colonial Life Insurance Company (CLICO) Investment Bank, which sold the HMB shares to Stone Street Capital.
That became a national scandal when the matter was raised in Parliament in April 2007 by a member of the opposition who pointed out that Monteil’s leadership positions with all three companies involved created a conflict of interest or led to insider trading.
Monteil’s role as treasurer of the ruling People’s National Movement (PNM) also raised ethical issues about the purchase. The case was further complicated by suggestions that financing for the private purchase of HMB shares was supported by public funds.
"In 2007 a member of the opposition alleged that, in February of that year, CLICO Investment Bank accepted a deposit of TT$100 million (US$16.5 million) from the Housing Development Corporation (HDC)," the report said.
"Monteil was chairman of both institutions and because the deposit occurred a matter of weeks before CLICO sold HMB shares to Monteil’s Stone Street Capital, some speculated that the HDC deposit to CLICO Investment Bank gave the bank sufficient liquidity to be able to lend Monteil’s Stone Street Capital the money to pay for the HMB shares," the report stated.
It said a review conducted by The Ministry of Finance "discovered no evidence of wrongdoing in the sale of the HMB shares...Additionally, the central bank concluded that the trade met the conditions established by the revised Home Mortgage Bank Act."
It said, "The prime minister brushed off suggestions of impropriety surrounding the HDC deposit to CLICO Investment Bank, stating that it was a short-term deposit of TT$60 million (US$9.8 million) made only to earn interest."
Transparency International noted that in June 2008 police confirmed that the case remained under investigation by the Anti-corruption Investigations Bureau, "though no findings have been forthcoming".
It said, "Such treatment gives credibility to the suggestions of one parliamentarian that Monteil’s ranking among the ruling party effectively exempted him from government scrutiny."
The organization said, "The government’s failure to address the implications of highly overlapping directorships undermines public trust and threatens the integrity of the state."
It added, "If overlapping directorships continue to be a facet of Trinidad and Tobago’s public and private enterprises, the door remains open for conflicts of interest to tempt those in positions of power to abuse their status for personal gain."
It acknowledged that closing that door to overlapping directorships could put to rest some public suspicions of executive misconduct, but at the same time admitted that such a move may not be possible in the small Trinidad and Tobago market.
"What is possible, however, is for the regulatory framework to be reformed to require enterprises with overlapping directorships to exercise much higher standards of transparency and accountability," it concluded.
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