THE STATE will not begin releasing payments to Clico policyholders before the end of the year, Attorney General Anand Ramlogan said yesterday, as the Government revealed the Ministry of Finance has retained British Queen’s Counsel Gabriel Moss to advise on the matter.
“We are looking at the new year,” Ramlogan said in an interview. “I am in the process of finalising the legal agreement,” he said. The Attorney General had met with officials of the Ministry of Finance and CL Financial Limited (Clico’s parent company) on Monday night to examine the terms and conditions of an agreement which policyholders will sign if they agree to the State’s bailout. The bailout is an offer of $75,000 for policies equal to or below this value, and a 20-year, zero rated bond for policies worth more than $75,000.
The Attorney General disclosed that the Ministry of Finance — upon advice from the Office of the Treasury Solicitor — has retained Moss to advise a legal team comprising of officials from the Ministry of Finance and the Ministry of the Attorney General.
Moss, of 3-4 South Square Chambers, London, is an expert on insolvency. He has functioned as a Deputy High Court Judge in the Chancery Division (which deals mainly with finance cases) of the United Kingdom’s High Court.
Ramlogan also yesterday afternoon confirmed that another meeting of officials of the Ministry of Finance and CL Financial is expected to occur next week, after the Christmas holidays.
An official with knowledge of the talks yesterday indicated that payout would “more than likely” begin in the first week of January.
“We continue to meet and fine tune the matter,” the official said yesterday. “By and large everything is agreement and is in its final stages.” The official added, “a payout is not too far off.”
Since September, Finance Minister Winston Dookeran announced that policyholders would be paid out under specific terms which he detailed in his Budget 2011 presentation. Since then, the payout process has faced several challenges, some of which has come from policyholders themselves.
While some — including the acting chairman of the Clico Policyholders Group (CPG) Peter Permell and Opposition Leader Dr Keith Rowley — have criticised the Ministry of Finance for delays in the payout, a major cause of delay since September has been the fact that the State has engaged in consultations with policyholders after some raised legal objections.
The very month of the Budget, a group of policyholders called the Clico Policyholders Protection Association, associated with dropped UNC MP Ramesh Lawrence Maharaj, said the Finance’s Minister’s planned payments were illegal, arguing the Government did not have powers to pay out given the terms of the Central Bank Act.
The matter was taken up by the CPG, who revealed the State planned to bring legislation to shield itself from legal action. However, Government, on October 2, backed down from bringing legislation and instead began a process of consultation under a committee chaired by Minister of Food Production Vasant Bharath.
That committee met over several weeks with several submissions being made to the Cabinet.
At the same time, there has been the problem of Clico records reportedly being “in a mess”, and another problem of the precise terms of the legal agreement which policyholders are to sign on to should they accept the Government’s bailout.
