Gail Alexan­der

The Gov­ern­ment is ap­point­ing a com­mis­sion of en­quiry in­to the fi­nan­cial cri­sis at CL Fi­nan­cial and al­so the Hin­du Cred­it Union, Prime Min­is­ter Prime Min­is­ter Kam­la Per­sad-Bisses­sar an­nounced yes­ter­day. "This (CLF) is a scan­dal of mon­u­men­tal pro­por­tions. The root caus­es of this fi­nan­cial col­lapse must be ful­ly ven­ti­lat­ed. The per­sons deemed re­spon­si­ble must be held ac­count­able," Per­sad- Bisses­sar said in a state­ment to the House of Rep­re­sen­ta­tives. She al­so ex­plained why the Gov­ern­ment had pulled back from pre­sent­ing a bill to block le­gal ac­tion against Cli­co.

She said the new ad­min­is­tra­tion did not want to use its par­lia­men­tary ma­jor­i­ty to de­prive cit­i­zens of their right of ac­cess to the courts. Per­sad- Bisses­sar spoke af­ter the Cab­i­net on Thurs­day de­cid­ed at the eleventh hour not to present a bill to block cit­i­zens from tak­ing le­gal ac­tion on the Cli­co dilem­ma.

She said af­ter ex­ten­sive Cab­i­net dis­cus­sions, the Gov­ern­ment had de­cid­ed not to pro­ceed with the pro­posed leg­is­la­tion which had al­ready been sent to the Par­lia­ment on Tues­day. Per­sad- Bisses­sar said: "We made the choice that we will not pro­ceed with that bill be­cause we were not of the view that we should use our spe­cial ma­jor­i­ty in the Par­lia­ment to de­prive cit­i­zens of their right of ac­cess to the courts. "It was laid in the Par­lia­ment on Tues­day, I be­lieve–af­ter the (Cab­i­net) meet­ing on Mon­day–un­der the un­der­stand­ing that fur­ther amend­ments would be made and fi­nalised at Thurs­day's Cab­i­net meet­ing. "At Thurs­day's Cab­i­net with more in­for­ma­tion that came to us, we de­cid­ed we would ex­plore oth­er op­tions. So we did not want to use our ma­jor­i­ty. "For the first time we would have been us­ing such a ma­jor­i­ty sim­ply to de­prive cit­i­zens of right of ac­cess to the courts. That is why we did not pro­ceed. Mem­bers felt very strong­ly about it." Per­sad-Bisses­sar al­so said: Dur­ing the bud­get de­bate I said we must first lis­ten and then lead. So we want to give Cli­co stake­hold­ers an op­por­tu­ni­ty to voice their con­cerns."

She said Cab­i­net es­tab­lished an in­ter­min­is­te­r­i­al sub-com­mit­tee head­ed by Food Pro­duc­tion Min­is­ter Vas­ant Bharath to en­gage in dis­cus­sions with var­i­ous stake­hold­ers "to lis­ten to the peo­ple."

Per­sad-Bisses­sar de­nied there was a frac­ture in the Cab­i­net on the abort­ed bill. She said: "Noth­ing is fur­ther from the truth. There is no ""bac­cha­nal" in the Cab­i­net. It was a unan­i­mous de­ci­sion in the Cab­i­net yes­ter­day...we are all one fam­i­ly. Do not live with bat­ed breath and with great ex­pec­ta­tions be­cause it is not go­ing to hap­pen. We will hold to­geth­er." On the CLF com­mis­sion of en­quiry, Per­sad-Bisses­sar said: "Giv­en the sys­temic risk in­volved with this cri­sis and the thou­sands ad­verse­ly af­fect­ed, the sig­nif­i­cant tax­pay­ers' funds al­ready spent and to be spent, Cab­i­net has de­cid­ed to have a Com­mis­sion of En­quiry ap­point­ed in­to this fi­nan­cial cri­sis, the CL Fi­nan­cial cri­sis as well as HCU.

"The com­mis­sion will in­ves­ti­gate the files of Cli­co, BAT and CIB, as well as the over­all CL Fi­nan­cial group and HCU," she added. The com­mis­sion will be con­duct­ed in ad­di­tion to the in­ves­ti­ga­tions that have al­ready been con­duct­ed by foren­sic in­ves­ti­ga­tors. Per­sad Bisses­sar said the re­sults of these foren­sic in­ves­ti­ga­tions have been sent to the Of­fice of the DPP by the At­tor­ney Gen­er­al. The PM aimed much of her 37-minute state­ment at the Op­po­si­tion PNM, blam­ing the past gov­ern­ment for the Cli­co sit­u­a­tion and query­ing the use of the $7.3 bil­lion which the PNM had pumped in­to a Cli­co bailout.

She said: "Where did it go? Who are the peo­ple that were paid? How was it utilised? These are se­ri­ous ques­tions to be an­swered. What cri­te­ria did you use to re­pay in­vestors? Whom did you choose to pay? How were they cho­sen? These ques­tions need to be an­swered.

"Why are you now cry­ing croc­o­dile tears about trade unions, cred­it unions, the poor man and small man–why did you not pay them first? Tax­pay­ers need to know." Per­sad-Bisses­sar traced the CLF down­fall, say­ing it was "in the sense of a scheme...Now we are hear­ing about Ponzi schemes.This here was the CL scheme. "What it was re­al­ly is to take peo­ple's mon­ey in non-tra­di­tion­al in­vest­ments, push it out there in very risky in­vest­ments to try to get a very high rate of re­turn and, of course, like a pack of cards, it col­lapsed," she said. She added that fur­ther in­ves­ti­ga­tion in­to this group was re­quired, since bank­rupt­cy signs were vis­i­ble years ago. "There was over­sight and gov­er­nance fail­ure across the board, and ques­tions must be asked of the reg­u­la­tors, au­di­tors, ex­ec­u­tives and, of course, the pre­vi­ous ad­min­is­tra­tion un­der whom this all un­rav­elled," Per­sad-Bisses­sar said.

On the PP's as­sis­tance plan, she said in­stal­ment in­stru­ments could be cashed in ear­ly at fi­nan­cial in­sti­tu­tions at a dis­count. "But I have been in­formed by the Fi­nance Min­is­ter that based on dis­cus­sions with lo­cal fi­nan­cial in­sti­tu­tions, that if the first five years of in­stal­ment notes were cashed in, the dis­count could be as high as or as low as five to ten per cent," Per­sad-Bisses­sar said. "What this means is for every dol­lar, you could get be­tween 90 and 95 cents per dol­lar if you de­cide to dis­count, I am so ad­vised." She clar­i­fied her re­cent state­ments on the Gov­ern­ment's of­fer. She said: "I saw a head­line which said, 'Prime Min­is­ter said take it or leave it.' What I in­di­cat­ed, it is an of­fer be­ing made to peo­ple. It can be ac­cept­ed or re­ject­ed... No­body is forc­ing you to ac­cept it. That is the point I was mak­ing. "We'd love to pay every sin­gle per­son every sin­gle cent, but eco­nom­ic cir­cum­stances will not per­mit it," Per­sad-Bisses­sar added.