Archive for category Politics and Public Affairs
After a flurry of attempted explanations from the Minister of Planning & Sustainable Development, Dr. Bhoe Tewarie, as to the real meaning of the High Court’s 14 July ruling on the Invader’s Bay matter, the State has now appealed that ruling and applied for expedited hearing of the matter while having the judgment stayed.
What that means is that the State is asking the Court to agree an extension of the Stay of Execution until the appeal is decided, so that the requested information could be withheld while the case is being heard. Presumably, the State has asked for a speedy hearing so as to avoid any impression of them encouraging needless delay in this matter of high public concern.
This article will focus on the three critical findings in the judgment. I will be examining Dr. Tewarie’s statement to Parliament on Friday 18 July, alongside the facts and the actual High Court ruling.
Legal Professional Privilege
The very first point to be made in relation to this is that the reason given by the State for refusing the JCC’s request for this information was not originally ‘legal professional privilege’.
That reason for refusal was only advanced after the litigation started, literally arising out of the very briefcase of the State’s attorney, on his feet before Justice Seepersad on 4 December 2012.
We contested the State’s late introduction of these new reasons for refusal, but the Court ruled at para 37 –
- The Court…is of the view that the Defendant is entitled to rely upon additional reasons with respect to the refusal to disclose the said information…
The question of whether the legal opinions are privileged was ruled-upon by Justice Seepersad –
- It cannot be disputed that the said information requested, is information that would ordinarily attract legal professional privilege…
So that issue is not in dispute, in the Court’s mind at least. I continue to hold the view that it is highly-questionable to easily accept this notion of client confidentiality, given that the State ought to be acting on our common behalf.
In fact, no evidence was tendered nor was any real case made by the State as to the difficulties which would result from publishing the requested information. None. It is only now, with a ruling in the JCC’s favour, that we are getting these positions being advanced.
For the record, the JCC’s original request under the Freedom of Information Act (FoIA) was for the legal advices and the letters of instruction.
Consider this, from Dr. Tewarie’s opening statement -
The very first point that I wish to make with regard to the high court ruling is that there is no issue of disclosure here. There is no issue of failing to disclose or of wanting to withhold disclosures. The Government is not seeking to prevent disclosure of any matter nor is the Government fearful of making any disclosure of fact.
The only issue we are contesting is whether the advice of an Attorney to his/her client, which is generally regarded as privileged information, is subject to the jurisdiction of the Freedom of Information Act or whether, since it is a privileged exchange of information between Attorney and Client, it is exempt from the Act…”
If that is truly the case, with the State’s only concern being the possible adverse impact of releasing the legal advices, the question has to be – ‘Why not publish the letters of instruction now?’
Waiver of Privilege
A significant aspect of the case was as to the impact of Dr. Tewarie’s statement to the Senate on 28 February 2012, in reply to a question by then Independent Senator Dr. James Armstrong – see pg 716 of Hansard –
The answer to (c); the publication of the request for proposals was not the subject of nor required to be in conformity with the Central Tenders Board Act. Advice to this effect was received from the Legal Unit of the Ministry of Planning and the Economy, and subsequently from the Ministry of the Attorney General…
The point being advanced by the JCC was that a statement like that one, which purports to publicly disclose the very essence of the advice, has the effect of extinguishing the State’s right to suppress the document as being exempted.
The Court ruled clearly on this –
- The gist and nature of the legal advice was in fact revealed when the Minister’s response was made and this amounted to conduct that is inconsistent with the stance that the said legal advice is exempt from being disclosed under the Act by virtue of section 29(1)…
So, the High Court found that Dr. Tewarie’s statement to the Senate neutralized the State’s ‘legal professional privilege’. That is an important aspect of this ruling, given the frequency with which legal opinions and names are brandished by our leaders, always when convenient, of course.
The Public Interest Test
This ruling is significant in that Justice Seepersad weighed the existing ‘legal professional privilege’ – making a clear ruling on that at para 41 – against the ‘Public Interest Test’ set out in S.35 of the FoIA.
At one point it was widely reported that Dr. Tewarie was insisting that the ruling had nothing to do with transparency, but was only on the narrow issue of legal professional privilege.
The substance of Justice Seepersad’s ruling was at paras 85 & 86 -
- The nature of the project in this case and the process adopted by the Defendant to pursue the Request for Proposals process without regard to the provisions of the Central Tenders Board act, requires disclosure of all the relevant information that was considered before the said decision was taken and the refusal to provide the requested information can create a perception that there may have been misfeasance in the process and any such perception can result in the loss of public confidence. Every effort therefore ought to be made to avoid such a circumstance and if there is a valid and legally sound rationale for the adoption of the Request for Proposals process, then it must be in the public interest to disclose it and the rationale behind the process adopted ought not to be cloaked by a veil of secrecy.
- The public interest in having access to the requested information therefore is far more substantial than the Defendant’s interest in attempting to maintain any perceived confidentiality in relation to the said information…”
The real point here is that Justice Seepersad has carried out the Public Interest Test, as mandated at S.35 of the FoIA and ignored by the State in this matter, to find that the ‘legal professional privilege’ is subordinate to the Public Interest in this case, given all the evidence submitted to the Court.
The entire process possesses all the ingredients for corruption, I maintain that view.
Dr. Tewarie has repeatedly claimed that the process was transparent because he disclosed the assessment rules for the Invader’s Bay development at the T&T Contractors’ Association Dinner on Saturday 5 November 2011. That assertion is perfectly tautological, in that it is entirely true that the rules were revealed for the first time on that occasion, but it does not explain anything of substance. The decisive fact is that the closing-date for the Invader’s Bay RFP process was 4 October 2011, a full month before the rules were disclosed. That fact alone renders the entire process voidable and illegal.
What is more, we have to consider the widely-advertised public consultations on the redevelopment of King’s Wharf in San Fernando; the South-Western Peninsula development; the issue of ‘City-status’ for Chaguanas; Constitutional Reform and of course, the latest one, the Civil Society Board. The glaring question has to be – ‘When is the State hosting the first in its series of Public Consultations on the Invader’s Bay development?’
Finally, will this development process continue, while the legal arguments continue?
It seems to me that we are entering a sustained and hard-fought Information War, global in extent, but with local flavour. The main features of this are the attempted redefinition of Privacy as a defunct notion, right alongside the State’s duty to know all about us, but tell us as little as possible of their own operations. That is the name of the game, so these issues are going to be challenged strongly as we go forward.
The High Court ruled on 14 July 2014 that the Minister of Planning & Sustainable Development must provide the legal advice which was said to have justified the development process at Invader’s Bay. This case was brought by the JCC after the Ministry refused to publish the legal advice obtained in response to our challenge that the Invader’s Bay development process was in breach of the Central Tenders’ Board Act. Given the repeated statements that the legal opinions supported the State’s actions in relation to the CTB Act, the obvious question is ‘Why the secrecy and refusal to publish those opinions?‘
The JCC requested the legal opinions and the letters of instructions under the Freedom of Information Act and the judge applied the ‘Public Interest Test’ in deciding that the public right to that information eclipsed the accepted point as to the existence of ‘legal professional privilege’. There have been many comments on what has been described as a landmark ruling and it appears that the question of just what is an official secret is once again up for discussion.
We are now being told that the right of the client to maintain the confidentiality of legal advice is now under threat, so the State is reportedly considering an appeal of that High Court ruling. Read the rest of this entry »
Property ownership is a critical ingredient of the society we are trying to build. No one can deny that. The wealthiest people and companies in this society have made a great part of their wealth through property dealings – buying, leasing, sub-dividing, selling, renovating and so on. We all know that property is critical to amassing and holding wealth.
The single largest owner of all classes of property in the Republic is of course, the State. Those properties are described as ‘Public Property‘ in the Public Procurement & Disposal of Public Property Bill 2014 which is now being debated in Parliament. The penultimate paragraph of the Private Sector Civil Society group (PSCS) group statement of 13 June 2014, is clear -
“…Whilst very pleased with the progress to date and while not having sight of the amended bill we note two areas that remain of serious concern; the Role of civil society and the acquisition and disposal of public property…“.
At pg 7 of that Bill – “public property” means real or personal property owned by a public body;”
‘Real Property’ usually means real estate (freehold or leasehold), while ‘Personal Property’ usually means all other types of property such as licenses, concessions and tangible items of worth.
‘Owned’ usually means literally owned, as in the case of a freehold or leasehold interest, but there are other important types of property which are not literally in the ownership of a public body. Public Property is important because it is extremely valuable. The power of the State or its agencies to allocate those Public Properties must therefore be exercised in an equitable and transparent fashion if we are to foster proper conduct of our country’s public affairs.
In relation to real estate, it is important to note that the system of Crown Grants was used during the colonial period to encourage immigrants of a particular type. Immigrants who were of acceptable race, religious belief or station in life were allocated public lands for the purpose of agriculture. The actual documents are called ‘Crown Grants’ and they can be seen in our country’s records. The allocation of those lands to those selected people established a pattern of substantial wealth which took generations to displace. Of course such a system of property allocation, on the basis of ones’ external appearance and belief system, would be incompatible with our Republican status.
That history and the important role which property plays in today’s society are both reasons why the ‘disposal of public property‘ is an inescapable part of the new law, so that we can ensure good governance in these matters.
The Maha Saba Episode
This is a good example of a type of Public Property not literally owned by a Public Body. The dispute was over the decision of the previous administration to allocate radio licenses overnight to the Citadel Group, which was owned by a PNM member, at the same time as delaying the grant of broadcast licenses applied for by the Maha Saba. The Maha Saba had to take legal action all the way to the Privy Council to obtain a favourable judgment as to the breaches of principles of good public administration by that PNM government.
A new law intended to control dealings in Public Property as defined above would be one which extended beyond those literally owned by Public Bodies to include species of property in the ‘care, custody or control‘ of those bodies. That would allow future occurrences of a ‘Maha Saba episode’ to be rapidly rectified, also at less expense, by the Procurement Regulator as that type of property transaction would be within oversight of the new law.
In point of fact, it was reported that the Citadel group which comprised three radio stations was sold in 2012 to the CCN group (owners of this newspaper) in 2012 for a sum reported to be over $50M. So it is clear that these species of property have serious value, quite apart from any other aspects.
When Caroni Ltd. was closed in August 2004, about 76,000 acres came out of cultivation and become available for alternative uses. The Caroni lands stretch from Orange Grove at Trincity (near the large new Blue Water facility) as far south as Princes Town.
Given the fact that Chaguanas has been our fastest-growing town for almost 20 years now and the ongoing growth of investment in San Fernando and its outlying districts, it is clear that the Caroni lands have a critical role to play in our medium to long-term prospects. But those possible outcomes would be conditional on just how the Caroni lands are allocated in the short-term. As far as I am aware, a decade after abandoning sugar cultivation, there is still no strategic plan for how these lands are to be utilised. In the absence of a proper strategy for the management of those important State lands, there is scope for missed opportunity in terms of development and re-distribution.
The decisive land allocation issues would include -
- How does the allocation policy work together with the State’s broader economic policies?
- To whom are the lands allocated?
- On what terms are the lands allocated – i.e. for how long are the lands to be leased and with what restrictions? Some of the ex-Caroni workers are demanding grants of freehold interests from the State, but no decision seems to have been made on that.
- Does the State have the right to repossess the lands upon expiry of the lease?
- Does the allocation strategy have dynamic measures to control speculation? This is to prevent the growth of ‘flippers’ who just acquire property to hold and re-sell. There is a serious view that ‘flippers’ are a part of the market, but there is also a way that their presence can retard development as they do not typically improve or maintain their properties.
All of those issues must be located within equitable and transparent arrangements as required by the new law.
State Leases of offices
When the State leases offices or other property it is in fact procuring property via a transaction in Public Money. Those transactions must take place within a modern system which ensures good governance by attaining accountability, transparency and value for money.
There is a huge oversupply of offices in greater POS as a result of the State’s overbuilding during the last regime and the current administration is now shifting significant public offices out of POS. The combined impact of those ought to be a steady decline in both the gross amounts paid to landlords via State leases and the amounts paid per sq. ft.. That kind of change can only be obtained and monitored if the State’s leases of offices and other property are also part of the new Procurement system, so that the details are published as part of the database of State contracts.
The State-owned reclaimed lands at Invader’s Bay in west POS are another pregnant example of how the use of improper land allocation processes can injure the public interest. The JCC has mounted a legal challenge to seek publication of the legal advice obtained by the Ministry of Planning & Sustainable Development as to the legality of their activity ‘thus far’ in respect of that 70-acre parcel of prime land.
It is interesting to recall that one of the legal opinions on which the State seems to be relying, notes that this proposal was to grant long leases (about 99 years) to the successful bidders at Invader’s Bay. That was not considered a disposal since the State would have retained the freehold interest. Now that is probably the best example of why these types of transactions must be controlled by these modern and effective laws. The attempt to conflate a residual freehold interest with ownership, while at the same time denying the tremendous commercial value of a 99-year lease over prime lands was scandalous.
The most valuable properties in the capital are the leaseholds in St. Clair and Woodbrook, that much is indisputable, which is why we have guard against this kind of evasive advice to facilitate arrangements to escape proper oversight.
The Landed Interests
The ill-fated 2009 proposals for a new Property Tax would have required an updated and open database of the entire country’s property holdings. The campaign to ‘Axe the Tax’ was successful and that database never saw the light of day, which entirely suited the Landed Interests who are wary of any system which would expose their operations to easy scrutiny.
We need to be vigilant to ensure that the Public Procurement & Disposal of Public Property Bill 2014 does not leave a gaping, purposeful loophole thorough which our Public Money will continue to pour.
Given that our political parties receive financing from business-people, how will those party financiers be rewarded? In a situation which properly controls the award of State contracts for goods, works and services, how can they be rewarded?
The answer is Public Property.
One of the big unanswered questions arising out of the recent ‘grand corruption’ cases in relation to the Public Sector remains – ‘How can we lawfully punish those wrongdoers who are looting our country?‘
Most discussions proceed along the lines of what I call the ‘bag of money‘ idea, in which we are looking for the actual stolen money. The belief being that the stolen loot can actually be located and linked to the thieves, who will then face a harsh penalty. My preferred solution is for full disgorgement of all the stolen monies as a starting-point, even if that is a remote goal.
In re-examining the issue practically, one has to ask “Why do we persist in these ‘pipe-dreams’, while ignoring the ‘low-hanging fruit’ all around us?” So I am considering a new strategy for action on these critical issues.
‘Public Money’ is the term used to describe money due to or payable by the State, including those sums for which the State would be ultimately liable in the event of a default. Public Money is sometimes called Taxpayers’ Money, it is our Money. Read the rest of this entry »
On Wednesday 11 June 2014, the Senate unanimously approved the Public Procurement & Disposal of Public Property Bill 2014 and that Bill is soon to go to the House of Representatives for their deliberation. I was present to witness the collective efforts made by Senators on Tuesday 10 June and it was a really thought-provoking experience for me. I started to wonder just how much we could achieve if the banal point-scoring and ritual picong was to become a thing of the past. The basis of decision-making on public issues would have to shift to a fact-based one, which would be a huge, healthy step away from the sad formula of ‘might is right’.
What a day that would be for us all, just imagine.
But we have to exist in this place, as it is, with all its imperfections. Which leads me to discuss the constant questions put by people who want to know if ‘this law we are fighting for‘ could prevent this-or-that corrupt practice. So the two projects which I would use to give worked examples are -
- the THA/BOLT office project on which the High Court recently ruled;
- Calcutta Settlement/Eden Gardens land purchase by HDC.
This project was analysed in a previous article, which set out certain questionable aspects of those arrangements. In my opinion, the greatest areas of concern were -
- Size – THA stated that the Divisions for which this building was being leased now occupy 28,500sf, yet the completed project is to comprise 83,000sf – almost three times more space.
- Quality – The new building is projected to cost $143M, which equates to $1,723 per sq ft and that is at the upper end of office costs, even when we consider that the contract was reported to be for a fully fitted building.
- Rent – The current rent paid by the THA for the Divisions to be located in the new facility is an average of $8.17 per sq ft. The rent for the new facility was agreed at $15.61 per sq ft, which is almost twice the rate now paid. It was telling that the THA relied on the statements of a Civil Engineer, Peter Forde, who sought to justify that rent by reference to the fact that $10 per sq ft was being paid for some offices in Scarborough. Mr. Forde is an esteemed engineer with whom I have worked well in the past, but that is like relying on my advice, as a Chartered Valuation Surveyor, as to the correct steel to use in some complex structure.
- Total Costs – The total monthly rent now paid by THA for those Divisions is $231,788, while the new project is set to cost a monthly rent of $1.295M – more than five times more.
All of these arrangements being made by a public authority which makes a compelling case that the Central Government has starved them of financial resources over a considerable period. The THA, starved of money, is justifying a deal which will hugely increase their monthly rent bill, for an office building three times larger than required at a higher quality than any other in Tobago. That is the sense of this deal.
The recent litigation over this project was altered after it started, to two questions of ‘construction’, being ruled by the Court to be issues of public interest -
- Finance Ministry approval – Is THA required to obtain approval from the Ministry of Finance before entering a BOLT arrangement?
- Tendering procedure – Is THA required to follow the procedures of the Central Tenders Board Act (CTB Act) in entering a BOLT arrangement?
The High Court ruling on 30 April 2014 was claimed by THA to be an endorsement of their course of action, but this is what it actually meant.
|ISSUES||High Court Ruling||Proposed Public Procurement Law|
|Preliminary considerations||No ruling by the Court.||A Needs Assessment would be required to take account of a life-cycle costing, which includes both initial and cost-in-use aspects.|
|Ministry of Finance approval||At para 33, the Court ruled that THA is not required to obtain approval of the Minister of Finance. In that respect, one can understand THA’s claim to have been vindicated.At para 29, the Court makes the inescapable point that since this is a 20-year recurrent commitment which would have to be paid for by financing from the Central Government, it would be prudent for the THA to consult with the Finance Ministry before entering such arrangements.||This is a transaction in ‘Public Money’ via a ‘Public Private Partnership’ which is included in the remit of the proposed law.|
|Tendering Procedure||At paras 48 through 51, the Court was emphatic that the THA was required to follow the provisions of the CTB Act.||The proposed law abolishes and replaces the CTB Act and would include this kind of project under the oversight of the Office of Procurement Regulation.|
In this case, the THA’s claims of victory appear unrealistic, but the good news is that the proposed arrangements will act to prevent a recurrence of this wasteful type of project.
This 2012 purchase of 50.5 acres (comprising 264 residential lots with ancillary uses) by the Housing Development Corporation (HDC) was also the subject of a series of articles in this space, which highlighted these questionable aspects -
- Private sales as individual lots – Eden Gardens lots were being offered for sale in 2011 at $400,000.
- HDC Valuations or Offers? – HDC obtained a private valuation of the property at $52M in November 2011. In January 2012 Eden Gardens is offered to the HDC at $200M. So why did HDC order a valuation in November 2011? Was there an attempt to offer the site to HDC before November 2011 and at what price?
- The State valuer exceeds the opinion of a private valuer? – Of course that is virtually unknown, but the fact is that the Commissioner of Valuations issued an opinion of value in April 2012 placing the property at $180M.
- HDC Purchase – The HDC buys the property in November 2012 at $175M, which equates to $663,000 per lot. Given that those lots were available in 2011 at $400,000, that is a 66% increase in the value of those lands within one year, which can make no sense. It makes even less sense when one considers that HDC was buying the all that land at once, so a discount would be the rational and expected commercial practice. So what was the basis on which this price was settled?
- Plan ‘B’ – The State had the power to compulsorily acquire the land if it was required for a public purpose, which housing is. The point being that the State could have lawfully acquired Eden Gardens for no more than $35M, if they had chosen to use their powers of compulsory acquisition. So, why did they choose to go the Private Treaty route?
- The ‘Ultimate Beneficial Owner’ – The basic business practice required of bankers and other finance professionals is to ‘Know Your Customer’ as a fundamental part of ‘Anti Money Laundering’ (AML) laws now in force in this country. Those laws and professional practices have now extended to cover the activities of real estate agents, so anyone selling land would be required to conform. The vendor of Eden Gardens was Point Lisas Park Limited, but from my research at the Registrar General’s Dept, it seems that PLP Ltd. has never issued shares. Which means that we can only speculate as to who was the ‘Ultimate Beneficial Owner’ of Eden Gardens and indeed, who received $175M for that property.
The proposed new laws do not contain any provisions to govern the State in ‘acquiring public property’, which was the case in Eden Gardens, since the State was buying land.
This is one of the outstanding serious concerns as to the proposed new law, which would not act to prevent this type of corrupt practice. Our Parliamentarians need to consider these aspects in finalising this law.
The public is being told that the CL Financial bailout is being resolved, while at the same time the Minister of Finance & the Economy is withholding the fundamental information which any prudent person would need to make a decision. So, what is the secret?
Apart from the details I have been asking for, there are other questions which occur to me -
- Directors’ Fees – What is the comparative level of Directors’ fees before and after the bailout on 30 January 2009? In particular, what are the fees & expenses payable to CL Financial Directors? Have those increased? If so, to what level and on what rationale?
- Related Party dealings – We were told that one of the main causes of the CL Financial collapse was excessive related-party transactions. Has that pattern of dealings has really changed? What are the contracts between the group and companies in which Directors hold an interest? Does the group, or the Minister of Finance, keep a record of these connected contracts? Does the group have a robust procurement procedure which would ensure value for money in all its significant transactions?
- Asset disposals – Which of the group’s assets have been disposed-of since the bailout and on what terms? Were proper valuations obtained before these disposals?
The original complaint is here -
From: Afra Raymond <firstname.lastname@example.org>
Date: Mon, Sep 10, 2012 at 11:12 PM
Subject: Compliance of CL Financial Directors with the Integrity in Public Life Act
The Integrity in Public Life Act requires that “Members of the Boards of all Statutory Bodies and State Enterprises including those bodies in which the State has a controlling interest” are required to file returns and declare interests with the Integrity Commission.
Clause 3.1. of the CL Financial Shareholders’ Agreement of 12th June 2009 – see http://afraraymond.files.wordpress.com/2010/03/mou21.pdf – specifies that the Board of Directors of CLF shall consist of seven Directors, four of which shall be nominated by the Government. The GORTT has a controlling interest and it is public knowledge that the GORTT has exercised those rights, amounting to strong influence evidencing control.
It seems clear that the directors of CL Financial Ltd are therefore persons who should file declarations, and therefore also the directors of subsidiaries under their influence and control, but having visited your offices earlier today to examine the Register of Interests it seems that these Directors have not been filing returns with you.
For your information, your staff confirmed to me today that none of these people have filed declarations or been required to file such for 2009, 2010 or 2011 -
- Gerald Yet Ming (CLF’s current Chairman)
- Hayden Charles (CLICO Director)
- Ronald Harford (Republic Bank’s Chairman)
- Dr Euric Bobb (former CLF Chairman)
- Rampersad Motilal (Managing Director of Methanol Holdings Limited)
I am therefore requesting, in the public interest, your confirmation that Directors of CL Financial and the companies within its control are required to file declarations or your confirmation that those Directors are not required to file or such other informative response that will satisfy this complaint of apparent non-compliance.
I await your early reply.
From: Afra Raymond [mailto:email@example.com]
Sent: Thursday, 20 March 2014 09:56 PM
To: Registrar, Integrity Commission
Subject: Fwd: Compliance of CL Financial Directors with the Integrity in Public Life Act
Dear Mr. Farrell,
I am seeking an update from you on your progress in relation to this formal report made to the Integrity Commission on 10th September 2012.
Apart from a brief telephone conversation we had a few days after its submission, I have had neither acknowledgment or reply to this report.
I await your early reply.
On Fri, Mar 21, 2014 at 4:54 PM, Registrar, Integrity Commission <Registrar@integritycommission.org.tt> wrote:
Dear Mr Raymond
Our recollection in the office is that a response was sent to you and we are examining our records.
In any case, a response will be sent to you.
On Fri, Mar 21, 2014 Afra Raymond <firstname.lastname@example.org> wrote:Hello Mr. Farrell,
I appreciate your early attention to my query.
From: Afra Raymond <email@example.com>
Date: Thu, May 22, 2014 at 11:44 AM
Subject: Re: Compliance of CL Financial Directors with the Integrity in Public Life Act
To: “Registrar, Integrity Commission” <Registrar@integritycommission.org.tt>
Hello Mr. Farrell,
I wrote to you on 20th March 2014 seeking an update to my formal report of 10th September 2012 to the Integrity Commission on this matter. You replied the next day indicating that you thought that a reply had already been sent but that in any case a reply would be sent to me.
To date I have had no response to my formal complaint or the request for an update as to its status. In the interim, I have carefully examined the Commission’s 2012 and 2013 Annual Reports and found no mention of my complaint in the sections which provide an outline of the various investigations being undertaken. According to those Reports, the status of those investigations seem to fall into three categories – ‘Closed’ – denoting those matters which have been effectively dismissed, due to lack of evidence or irrelevance; ‘Completed’ – denoting those matters which have been investigated or ‘Continuing’ for those matters which are still under investigation. I am starting to wonder if my formal complaint has been relegated to some new, as yet undisclosed, category.
I am also going to point out that, according to the Integrity Commission’s Public Notice at pg 49 of the Sunday Express of 6th October 2013, the Integrity in Public Life Act applies to State Enterprises. At the fourth para of that Public Notice, which was intended to clarify published concerns as to the implications of the Appeal Court ruling in #30 of 2008, you state that State Enterprises are companies which are controlled by the State, so I would again invite your attention to the particulars of my original complaint in this matter. As you would appreciate from my published analysis, the position taken by the Commission in that Public Notice is one with which I strongly disagree, nonetheless, that position is the Integrity Commission’s formal statement on the matter.
For ease of reference, that Public Notice is here -
http://afraraymond.files.wordpress.com/2013/10/ic-response2013.pdf – since I was unable to locate it on the Commission’s website.
I am closing by pointing out that this is a matter of the gravest possible public concern, since CL Financial has been the recipient of over $25 Billion TTD in Public Money and its affairs remain shrouded in an intentional obscurity which does violence to the modern notions of Transparency, Accountability and Good Governance. That obscurity includes the channelling of those huge sums of Public Money via the Central Bank which is exempt from the Freedom of Information Act; new laws to approve the exemption of the Central Bank from any judicial review of its actions in this matter (that has now been ruled as unconstitutional by the High Court in #4383 of 2012, of course the State has appealed that, so the fight is on); the failure/refusal of CL Financial to publish audited accounts and the failure/refusal of CL Financial’s Directors to comply with the Integrity in Public Life Act.
That is the factual background against which I lodged my formal complaint. The delay and ambiguity with which the Integrity Commission appears to be treating my complaint on this most serious matter is sobering, to say the least.
I trust that you can give this matter your early attention, in the meantime, I will be publishing this as a record of these developments.
Dear Mr. Raymond
On behalf of Mr. Farrell I do apologize for not responding to your query. Please note that your query was not classified as a compliant so you would not find it in the complaints section of the 2012 or 2013 Annual Report. With respect to your query we have sought and obtained legal advice. However the Commission is not properly constituted ( a Commissioner having resigned and not yet replaced by his Excellency the President) at this time and therefore cannot make decisions. As soon as the Commission becomes properly constituted the matter will be placed before the Commission for a decision.
In the interim I would appreciate if you can provide us with a copy of the CL Financial Shareholders Agreement.
From: Afra Raymond [mailto:firstname.lastname@example.org]
Sent: Thursday, 22 May 2014 05:12 PM
To: Registrar, Integrity Commission
Subject: Re: Compliance of CL Financial Directors with the Integrity inPublicLife Act
Hello Ms. Phillips,
I thank you for your swift reply and trust that this matter can now receive proper attention.
The Ministry of Finance made a Press Release on 12th June 2009 -http://www.afraraymond.files.wordpress.com/2011/03/minoffin_pr_12jun2009.pdf – which I received prior to the actual Shareholders Agreement being released to me pursuant to my Freedom of Information request. As requested, the actual CL Financial Shareholders Agreement of 12th June 2009 is here – http://afraraymond.files.wordpress.com/2010/03/mou21.pdf – for your consideration.
I await your reply.
On Friday, May 23, 2014, Registrar, Integrity Commission <Registrar@integritycommission.org.tt> wrote:
Dear Mr. Raymond
Thanks for your understanding. However used the link provided but most of the pages of the Agreement are blank.
From: Afra Raymond [mailto:email@example.com]
Sent: Friday, 23 May 2014 09:06 AM
To: Registrar, Integrity Commission
Subject: Re: Compliance of CL Financial Directors with the Integrity in PublicLife Act
Hello Ms. Phillips,
The Shareholders’ Agreement is showing ok at my end, the scanned copy I was sent seemed a little faded, that was all.
The link I sent you yesterday was included in my original email of 10th September 2012, so it’s not clear whether that actually received proper attention.
I suppose that the Finance Ministry would provide a copy if you asked, seeing that they sent it to me.
Registrar, Integrity Commission May 23
On 1st June 2014, my former colleague and Business Guardian Editor, Anthony Wilson, made a call for a ‘national debate’ on the proposed disposal of CLICO’s traditional portfolio of insurance business. This is the first of my responses.
We are now entering the chaotic endgame of this epic CL Financial bailout fiasco. Some of the recent official statements are -
- CL Financial’s other assets, including majority shareholdings in Republic Bank Limited and Methanol Holdings to be sold;
- Full repayment of Public Money advanced in this bailout is expected.
- CLICO’s traditional insurance policy portfolio is being professionally valued prior to its intended disposal;
- Atrius Ltd., set up in 2013 as an alternative vehicle for CLICO’s continuing business, is to be effectively abandoned;
- All of CLICO’s sales agents are to be terminated by the end of this month, June 2014;
The recent statements of both the Minister of Finance, Larry Howai, and the Governor of the Central Bank, Jwala Rambarran, could give the public an impression that this financial disaster has now been mostly resolved and we are on some kind of smooth track to a complete solution.
I remain sceptical as to the extent to which these problems have been resolved. The complete lack of detailed information, despite many requests by myself and others, leaves one to wonder just what is the basis for these serious decisions.
So, why am I saying this?
The money being used in the CL Financial bailout is ‘Public Money’, which we sometimes call tax-payers’ dollars. The leading learning from which we have to draw serious lessons is Lord Sharman’s 2001 Report to the British Parliament ‘Holding to Account‘, which was a thorough examination of the definition, role and need for control of ‘Public Money’. In the Public Procurement campaign we expanded on Sharman’s definition of ‘Public Money’ so as to capture the full range of possibilities, but we have accepted his key finding as to the requirement that ‘Public Money’ is to be managed to a higher standard of Accountability and transparency than Private Money – see 2.23 on pg 15.
The contemporary, best-practice position in respect of the management of and accountability for Public Money being that the private sector rules are the bare minimum.
CL Financial Ltd. is a holding company for the Duprey empire, comprising major companies such as Republic Bank Ltd.; the Angostura Group; Methanol Holdings Trinidad Ltd; Home Construction Group of Companies; British-American Insurance Company Ltd; Lascelles-Mercado Ltd. (the Jamaican owners of Appleton and Wray & Nephew rums).
The last audited accounts for the CL Financial group were published on 18 November 2008, for the financial year ending 31 December 2007. The function of consolidated audited accounts is to give investors and management the necessary information with which to make decisions as to the future of the company.
Since 2009 I have been making requests under the Freedom of Information Act for these items of information -
- Audited Accounts for the CL Financial group, or the basis of the various statements by successive Ministers of Finance;
- Senate Briefing – details of the high-level briefing given to Independent Senators in September 2011 prior to the vote on the two new laws – one to allow the State to borrow an additional $10.7 Billion to settle the bailout and the Act to shield the Central Bank from the supervision of the Courts;
- Payments – details of the payments to the various claimants under the terms of the bailout, in particular EFPA-holders;
- Integrity Commission – confirmation of whether the Minister of Finance was requiring the CL Financial Directors to file declarations as required by law.
I have effectively withdrawn the last of those requests and am now in litigation against the Minister of Finance & the Economy for the first three items. The State has resisted those claims and the litigation continues. I have continued my quest on the compliance of CL Financial’s Directors with the Integrity in Public Life Act with the Integrity Commission, despite the serial delays and unresponsiveness which have beset those requests.
The question before us now is, “How can the State and our government be making these serious, long-term decisions in the absence of the basic information?” Put another way, “How can we continue to allow these serious decisions to be made in our name on our behalf and supposedly, for our benefit, while the State continues to withhold the basic information?“
We have now entered the unimaginable territory of unexamined State power being exercised on an unprecedented scale in the pursuit of an unknown agenda.
This is the big picture and it is an ugly one.
Try to imagine the Board of a major, privately-owned, holding company proposing to its Shareholders that its major assets be disposed-of without the basic information, such as audited accounts or details of meetings with major stakeholders. Such an action would be seen as a gross violation of elementary norms of corporate governance and quite likely be rejected with swift, high-level dismissals. Yet, here we have our government (the Board of Directors) proposing these actions while refusing the reasonable requests of shareholders (citizens such as myself and others) for the rationale for and basic information underlying this process.
The fundamental, best-practice principle that Public Money is to be managed to and accounted for to a higher standard than Private Money has seemingly been rejected. Rejected by the Minister of Finance & the Economy and the Governor of the Central Bank.
That is the scale of this ‘thing without a name’. I tell you.
We, the citizens and taxpayers of this Republic, are being told that this unprecedented expenditure of Public Money of $25 Billion is to be resolved by a questionable process. The long-time saying is buzzing through my head – ‘What eh meet yuh, eh pass yuh‘.
Some points to remember in thinking about this issue -
- CL Financial Shareholders’ Agreement expires at the end of June 2014;
- Asset Sales have continued with the unadvertised sales of Valpark and Atlantic Plazas;
- No Interest was charged on the huge sums of Public Money spent to settle the indebtedness of the CL Financial group. The Board of Inland Revenue is a Division of the Ministry of Finance & the Economy and annual interest of 20% is charged to taxpayers who are late in their payments.
- ‘Fit & Proper’ regulations have never been applied to this CL Financial collapse, as mandated by Central Bank’s regulations, despite my continuing calls. One has to wonder if the stage is being set for a return of Lawrence Duprey & his cohorts to our country’s high-level corporate lifestyle.
On 28 May 2014, the Business Express ‘Opinion‘ was entitled ‘Bringing closure to the CLICO debacle‘ and one of the statements in that editorial was stunning -
“…Thus far, Rambarran and Finance Minister Larry Howai have been forthcoming in their handling of the CLICO issue…”
I could not agree less. The taxpayers and citizens of Trinidad & Tobago are being abused in this entire process.