Officials of Hand-in-Hand Trust Corporation Inc remain tight-lipped about the sale of shares Jonathan Brassington, brother of Head of the Privatisation Unit Winston Brassington, as the transaction and the circumstances that led to it continue to be speculated upon.
It is still unclear how it was that Jonathan Brassington knew about the dire need of Hand in Hand Trust to have investors buy shares since, as brother Winston pointed out, there was no advertisement for the purchase of the company shares as this would have caused a run on the financial institution.
Winston Brassington is the Head of the Privatisation Unit and the CEO of National Industrial and Commercial Investments Limited. Both of these entities were instrumental in the privatisation of the Guyana National Cooperative Bank Trust (GNCB Trust) which eventually became known as the Hand in Hand (HiH) Trust. The privatisation took place in 2002.
Despite the numerous attempts, this newspaper could not contact either CEO of the Hand in Hand Group of Companies Keith Evelyn or General Manager and Director of HiH Trust Hewley Nelson for HiH’s side of the story. The secretaries of both officials took the telephone number of the reporter and said they would make contact when an appointment was fixed, but no such contact has been made.
Observers believe that Brassington being involved in a transaction that involved his brother is at the very least unethical even if not constituting a breach of any law.
They question whether Brassington’s brother – a US based entrepreneur in the IT sector – benefited from his knowledge before investing in HiH Trust. Winston Brassington has rejected this and said that he did nothing either illegal or unethical with regard to insider information. Winston Brassington is adamant that it was his brother’s investment that saved HiH Trust from certain doom. He said his brother bought 30 per cent of the shares which meant that HiH Trust still remained in control. Further, he said, Jonathan Brassington has received no dividends on the investment so far. Winston Brassington said that in 2008 when Hand in Hand took the Stanford hit, Evelyn had a press conference indicating that the exposure was $750 million. He explained that because of this, HiH Trust was not able to comply with the regulatory requirements of capital adequacy in accordance with the Bank of Guyana. He said it was imperative therefore that the company increase its capital.
Winston Brassington said after HiH Trust wrote off the money lost in the Stanford investment, “it is public knowledge that HiH Trust was in serious trouble.” He said that the loss wiped out the company’s capital base.
However, upon being questioned by Stabroek News, Winston Brassington insisted that there was no inside information and that NICIL had no veto or other powers on the Board of HiH Trust.
Observers said that while Winston Brassington was never on the board of HiH Trust, he acted as the representative of his brother, while at the same time he was representing NICIL with regard to the government’s shareholding in the entity. They noted that because of this fact, Winston Brassington would have been privy to information beyond that which would have been available to the general public.
In June 2009, Evelyn spoke of a plan to restore the capital adequacy of HiH Trust. At the time, he said the plan would have taken between two weeks and three months to be approved by the Bank of Guyana. He said then that the plan was essentially a proposal outlining how the company intends to increase its capital.
Around March of 2009, HiH Trust had revealed that it had invested approximately $822 million (at an exchange rate of $203 to US$1) the year before in the Antigua-based Stanford International Bank.
That bank was one of several institutions forced to curtail operations after the Stanford Financial Group headed by now jailed Allen Stanford came under scrutiny for running what was a suspected ponzi scheme. There was an acknowledgement on the part of HiH Trust that the likelihood of the retrieval of the investment was dim and its loss would erode the entity’s capital base.
