PORT OF SPAIN, Trinidad – Finance Minister Winston Dookeran says he is disappointed at a decision taken by CLICO Policyholders Group to take legal action against the six-month-old Trinidad and Tobago government.
Last week, Dookeran said the Kamla Persad Bissessar had no intention of following policies that have led other countries into the arms of international lending agencies, and insisted that the original offer made to policyholders to deal with the financial problems at the Colonial Life Insurance Company (CLICO) would be pursued.
But on Sunday, the policyholders unanimously passed a resolution to take legal action against the State at a meeting called to discuss the government’s latest position on the matter.
“I am disappointed that the CLICO Policyholders Group has resorted to such methods,” Dookeran told reporters, adding “the court can have an independent view” on the issue.
Under the new bailout plan for CLICO, the government said it would make an initial partial payment of a maximum of TT$75 000 (US$12.500) 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.
“The government is committed to pay TT$500 million (US$83.3 million) a year for 20 years to meet this commitment and if we had gone on a shorter term we would have had gone to 10 years we would jave had to commit ourselves to one billion (US$166.6 million) a year for 10 years,” Dookeran told Parliament.
But Deputy Chairman of the CLICO Policyholders Group, Peter Permell said that the group is poutting in place “the mechanisms…to pursue legal action on your behalf” even as he advised members to accept the government’s initial TT$75,000 payout offer only if it was given with “no strings attached”.
“Take the money once there are no conditions attached to it,” he said.
“Legal action is an option open to us. We could be suing the directors of the company, the Central Bank, the Minister of Finance,” he said,” adding that “we have to send a clear and unequivocal statement that we are not bluffing”.
Dookeran has also dismissed a proposal by the policy holders calling on the government to pay a substantial amount of their investments by selling off assets or using profits gained by CLICO, a member of the regional conglomerate CL Financial Group. (CMC)
