President Bharrat Jagdeo says that the Government will challenge the classification that the liquidator of CLICO (Bahamas) Craig Tony Gomez, is trying to attach to CLICO (Guyana)’s investment, where he wants to treat it as a related-party loan.
The President, according to GINA, said this would mean that Guyana would have to wait until policyholders are paid out of the proceeds of the liquidation before being receiving its share.
“If it is classified as an inter-company loan then in the settlement of the liabilities, it will go down the hierarchy. So first of all, from disposal of assets, they will settle policies and then whatever remains they’ll settle these other transactions. So now we are taking steps to fight that classification, to argue no, we had a policy there.”
Meanwhile, when the President was asked why former CEO of the company Geeta Singh-Knight remains with CLICO (Guyana) when other staff members were fired, and especially since she is being blamed for the difficulties facing the company, Jagdeo said that the institutional knowledge that Singh-Knight has is important to the company at this critical time.
“For example, when the liquidator of CLICO Bahamas said we didn’t have a policy, it was an inter-company loan, she showed us, because of her knowledge, she got the documents and made it clear that it was a policy rather than a loan,” Jagdeo stated.
Jagdeo also said that action has been taken by the Commissioner of Insurance and Judicial Manager Maria van Beek against CL Financial Ltd., and was able to secure an injunction against that company and some of its subsidiaries preventing it from receiving payment from Guyana.
The President explained that this action also covered an amount of US$15M that BOSAI Minerals Group (Guyana) Inc. owes to First Citizen Bank in Trinidad and Tobago. This bank was formerly CLICO Investment Bank which was transferred to the Government there on January 30 after CL Financial Limited was given a government bail-out.
“We are hoping that given the inter-related nature of the companies, given their common directorate and ownership, and given the guarantees that CL Financial had issued to both Guyana and CLICO (Bahamas) then that these resources they have here in BOSAI…should go towards settling some of the exposures; the liabilities in Guyana that CLICO (Guyana) has,” President Jagdeo stated.
CLICO (Guyana) has invested $6.9 billion (US$34 million) in CLICO (Bahamas) which was ordered liquidated in February, which forced the local authorities to place CLICO (Guyana) under Judicial Management. Following this action, on March 2 Bahamian Prime Minister Hubert Ingraham announced in Parliament that there appeared to be no record at that time of Guyana’s investment in the Bahamian company. Subsequently, records of CLICO (Guyana)’s investment were provided to the Bahamian authorities. On Monday, the Bahamian liquidator Gomez proposed that the amount dispatched from Georgetown be reclassified as unsecured intercompany advances.
