The Clico Stakeholders’ Alliance wants answers on why $6 billion seems to be missing from the Clico Statutory Fund.
Via a statement over the weekend, the CSA noted that in December 2011 Clico’s legal representative had written to the general manager of the Deposit Insurance Corporation (DIC) demanding repayment of over $6 billion dollars from the Clico Statutory Fund (TTD$6,054,106,622.30 ), stemming from the Clico Investment Bank being in compulsory liquidation.
The CSA noted a June 2012 letter from Clico managing director Carolyn John to Earl Boodhoo (CIB liquidator) detailing how a total of $6 billion was owed by CIB and a 2011 letter from the Clico legal consultant sent to Deposit Insurance in care of CIB, stating proof of the debt owed by CIB to Clico was $6 billion.
“Shrouded in secrecy is the fact that state agencies and other depositors received full payment of 100 per cent of their deposits at CIB with interest, while over $6 billion dollars of Clico policyholders’ fund was illegally confiscated by the state,” the CSA said.
The CSA noted that Inspector of Banks Carl Hiralal wrote Clico on a CIB letterhead of August 12, 2011, stating that CIB was deemed insolvent in the amount of $4.7 billion.
“Effectively, the Central Bank (CBTT), charged with protecting Clico’s statutory fund, misappropriated it, to the relief of CIB’s depositors, causing untold suffering of Clico’s policyholders. Legal minds should ponder the enormity of this transgression and how many of its own laws the CBTT broke with this,” CSA alleged.
The group noted Hiralal’s denial in August 2011 of a request for netting of balances on the basis it would give the impression of preferential treatment, but noted “preferential treatment has already been breached since policyholders, including state agencies, have been repaid using Clico’s Statutory Fund deposit in CIB.”
“The DIC chairman is the governor of Central Bank (CBTT). How is it possible for CBTT to ask DIC to repay Clico, a company under the control of CBTT? It’s a case where the regulator is asking and answering a question onto himself about companies he’s supposed to supervise in the first place. It appears CBTT appropriated Clico’s CIB deposits just to give it back later as a bail out,” the CAS claimed.
“If Clico is paid its $6 billion dollars due from CIB, the insolvency issue would be settled entirely and there would be no need to sell any asset of Clico or Clico itself.
“Continued denial of funds due to Clico only serves to manufacture a perceived insolvency to facilitate a fire sale of Clico assets to serve those interested in grabbing Clico’s assets cheaply.”
It added, “The public has been made to believe policyholders’ funds in Clico were mismanaged and used for purposes contrary to adding to policyholders’ value. The CSA has evidence to prove Clico can be fully funded if the law is followed.”