PORT OF SPAIN, Trinidad – Prime Minister Kamla Persad Bissessar Friday announced that a commission of inquiry would be established to examine the circumstances that led to the financial problems of the Colonial Life Insurance Company (CLICO) while accusing the last government of spending billions of dollars for a minority shareholding in a “bankrupt” company.
In a statement to the parliament, Persad Bissessar gave no indication how soon the commission would be established, but defended her administration’s decision to make a new payment offer policyholders and other depositors in CLICO, a member of the regional conglomerate CL Financial group, insisting to do otherwise would lead to a collapse of the Trinidad and Tobago economy.
She told legislators that the commission would not only inquire into CLICO, but the Hindu Credit Union (HCU) that has also received a bailout plan by her administration similar to what had been worked out for CLICO.
Under the new bailout plan, government will make an initial partial payment of a maximum of TT$75 000 (BDS$25 000) to depositors in the short term investment and mutual funds and those whose principal balances exceed $75 000 will be paid through a government IOU amortised over 20 years at zero interest.
Finance Minister Winston Dookeran said the government IOU would be structured in such a way that itcould be traded on the secondary markets, thereby creating a measure of immediate liquidity for the depositors.
“The commission will investigate the files of CLICO, British American Insurance and CLICO Investment Bank, as well the overall CL Financial Group and HCU.
“This commission will be conducted in addition to the investigations that have already been conducted by forensic investigators and I am advised that the results of these forensic investigations have been sent to the DPP [Director of Public Prosecutions] by the Office of the Attorney General.”
The prime minister said the root causes of the financial collapse of CLICO “must be fully ventilated” and the persons deemed responsible “must be held accountable”. (CMC)
