Welcome to BIPA
“A giant slap in the face!” That is how June Fowler, Chairperson of the Barbados Investors and Policyholders Alliance (BIPA), describes the disturbing absence in the Budget of any significant disclosure signalling further movement towards the promised June 2012 resolution to the CLICO debacle. “At least we know the Minister of Finance reads the Nation and is into recycling,” says Fowler, “because every word he spoke, we had all already read in a series of articles published in its pages months ago, together with proposals put forward in detail last year by the Judicial Manager.”
Already unimpressed by some of the ‘Options’ previously put forward by the Judicial Managers; frustrated by Government’s continued silence on official Reports; perturbed by the unconscionable lack of communication with policyholders, and troubled by the refusal to keep this matter of national importance on the Government’s ‘front burner’, BIPA deplores the fact that yet another promise to 35,000 Barbadians has been broken by the Government, and that the 10,000 BAICO policyholders didn’t even get a mention in the Budget speech.
The Alliance is also baffled by the Minister of Finance’s apparent failure to recognise the ripple effects Government’s inertia on the CLICO and BAICO fiascos is having on the local economy he claims so keen to boost. It is not just the victims and their families who are suffering, but also local businesses which policyholders are no longer able to patronise. “Imagine the difference to the state of the economy if the $854 million owed to policyholders was back in their hands and circulating locally,” points out June Fowler.
BIPA is adding this latest betrayal to the litany of previous unfulfilled promises and empty re-assurances, and laments the announcement of more meetings at which proposals are only “expected to be presented and discussed”. In particular, the Alliance is horrified at the sudden inclusion of the statement by the Minister of Finance that “if this effort at a resolution fails, the likelihood will be of devastating consequences for thousands of policyholders.”
Recoiling from this comment, June Fowler asks, “Are these the utterances of a Government that has given ‘a solemn promise’ or an undertaking to ‘stand by’ its words, let alone a Government that claims to humble itself and admit that they dropped the ball in many respects?” she adds. “Have they forgotten already that the wanton mismanagement of policyholders’ funds was allowed to happen and persist on their watch due to inadequate financial legislation and regulation, the negligence of regulatory bodies, and their continued procrastination and prevarication, instead of dealing with the problem head on from the start?”
Despite Government’s lack of commitment to their promise to find an expeditious and favourable resolution to this national scandal, BIPA remains committed to pursuing a fully satisfactory outcome for CLICO and BAICO policyholders using all available avenues and remedies, and looks forward to the continuing support of policyholders and stakeholders.
Response to Letter to the Editor in Nation newspaper of April 27th, from Mary Antione of St. Lucia, suggesting BIPA should make specific suggestions about the action to be taken on the CLICO debacle, and do ‘more real work’ instead of just ‘dropping hints’. Of course we had to respond firmly to that!
By – JUNE FOWLER, Barbados Investors & Policyholders Alliance Inc.
The Barbados Investors & Policyholders Alliance (BIPA) would like to thank Mary Antoine of St Lucia for her constructive comments and suggestions in the DAILY Nation of April 26, which have been noted.
We would also like to reassure Ms Antoine that, far from dropping “hints”, BIPA is already working through the courts to achieve one of a number of its objectives on behalf of its policyholding members, and that a great deal of other “real work” is going on behind the scenes, as well as in the public domain.
BIPA continues to monitor closely the work being done by the judicial manager. Given the millions of dollars in fees already paid and the granting by the court of what amounts to a “blank cheque” for its continuing costs, BIPA fully anticipates and expects the judicial manager to present an all-encompassing resolution for the 25 000 Barbadians and thousands more Eastern Caribbean people who are disastrously affected by this debacle.
The alliance also expects the timely commencement of legal proceedings against any and all of CLICO’s officers and directors who are found to have broken the laws of the land and/or failed to perform their fiduciary duties.
In the meantime, BIPA eagerly awaits the announcement of details of the proposals by the Barbados Government presenting a solution to the CLICO situation, which has been promised by the Minister of Finance to be delivered in the next eight weeks.
If necessary, BIPA will challenge or counter the proposals on behalf of its members, but for the time being, does not seek to make specific proposals of its own, and trusts that the final proposals made resulting from the various judicial manager’s reports will be inclusive of and satisfactory to all policyholders.
By Patrick Hoyos | Sun, March 18, 2012 – 9:38 AM
I understand there is some interim report of a forensic nature on CLICO. I repeat I have never seen it. I saw reference to its contents made in a local newspaper. I never trust the contents of that newspaper. – Prime Minister Freundel Stuart speaking last Wednesday during the Estimates Debate in the House of Assembly.
Having thus declared himself uninformed about the state of the forensic investigation into CLICO International Life insurance company (CIL), the Prime Minister went on to plead for somebody to show him the report. As far as he is concerned, the only place anybody is talking about some forensic audit is in a newspaper which he does not trust and presumably does not read.
When I heard Mr Stuart taking this tack on Wednesday afternoon, I nearly drove off the road. Here you have a Prime Minister proclaiming ignorance about possibly the most earth-shattering report prepared by an independent investigator on the most significant financial collapse ever to take place in Barbados, not to mention the rest of the region.
The road that led to the preparation of the Deloitte forensic audit was paved by the administration Mr Stuart himself leads, after two years of vacillation by his predecessor. In March 2010, 14 months after the Trinidad and Tobago government had to go in and rescue CL Financial and ten months after the Barbados Government entered into a similar memorandum of understanding with CLICO Holdings Barbados Ltd (CHBL), then Prime Minister David Thompson issued a warning to policy and annuity holders in the same House of Assembly.
He said that unless a way was found to restructure CIL, which involved its getting a substantial haircut, the whole thing might have to be placed under judicial management. This actually became the recommendation of the Oversight Committee in its memorandum to the Cabinet in mid-2010.
The Democratic Labour Party administration took ten months to emerge from its CLICO-induced stupor to actually act on Mr William Layne’s recommendation that a judicial manager be appointed, doing so in April 2011, six months after the death of Mr Thompson.
So how can a Prime Minister, whose administration had taken the fateful decision to put CIL into the hands of the High Court so that the equivalent of a receiver could be appointed, now be so out of the loop that he himself is not abreast of the latest events? That is, the contents of the forensic report?
Late last month, the judicial manager Deloitte Consulting Inc. said in a Press release that a recommendation which it made was “accepted by the court for the Financial Services Commission (FSC) of Barbados to initiate, with the assistance of the appropriate Government agencies, further investigations into the significant transactions identified in the forensic report and pursue any required criminal and/or civil legal actions”.
According to Deloitte, a main goal of the audit was to investigate the “amounts due from related companies” which totalled Bds$370 million at the date of appointment of the judicial manager. It said: “The forensic team was able to identify substantially all of the intercompany balances during the course of the audit.”
But it noted that “access to documentation, held by related entities which are not subject to judicial management, would be necessary to establish the validity of certain transactions”.
Remember, only CIL was put into judicial management, not its parent company CHBL, for which the audit said it acted as banker. That is presumably why the other Government agencies have been brought into the loop.
Mr Stuart, surely one could reasonably infer from that statement that the FSC would have by now received a copy of the forensic audit, not to mention whichever other Government agencies would have the power to investigate those “significant transactions” in order to “pursue any required criminal and/or civil legal actions”.
How broken is our administrative system that every Government agency connected with crime and punishment in this country now seems to be cooperating in pursuing leads from the forensic audit into whether there might have been any wrongdoing in the disposition of CIL money, which should have been there for its policy and annuity holders, yet the Prime Minister has still not seen a copy of said activity-triggering report?
The forensic report did not appear in the pages of THE NATION from out of the blue, Mr Stuart.
It is a circulating, finger-pointing document that has put your own political administration in a stranglehold. The court has put it in the hands of law and regulatory enforcement and the possible outcomes (at least in one’s imaginings) are frightening.
Yet, by your own admission, you still have not read it. You remain out of the loop.
But it shouldn’t be too hard to get a copy. I humbly suggest you do so, and read it. You may weep.
• Pat Hoyos is a publisher and business writer.