For those who may have missed the CNC3 discussion between Douglas Comacho, President of ATTIC (the Insurance Association), Senator Patrick Watson on behalf of the current Administration, and Peter Permel (currently representing unnamed investors) on the failed CLICO Empire and Government's plan to intervene, here is an excerpt that answers many questions and my take on what transpired.It focuses on this spokesman Peter Permel and some of his claims that have been undone by Senator Patrick Wason.
I have included the links to two videos at the bottom, and also my deconstruction of the significant portion of the interview:
NB For these purposes the term CLICO also refers to and includes CIB and CL Financial.
First Video:
0:01 - This video opens with Professor Watson extolling the virtues of diversification of investments so as to not lose all of your money should a failure occur, and he went on to name a couple of notable failures such as Trade Confirmers and International Trust. Too many people put all their money into CLICO and none elsewhere.
This is my point also. When it became a get rich scheme on its way to becoming the con game pyramid it ended as, agents and agencies were only concerned with selling for commission. Any financial advisor worth his salt would have been extolling the above expressed virtues, but in this case people were being encouraged to move all of their savings from the safety of the banks and to put it into CLICO by unscrupulous agents.
0:38 Matouk: The people selling these 'instruments' were no longer insurance salesmen, but were now calling themselves 'wealth advisors', 'financial advisors,' and they were advising clients to put all their eggs in one basket. (With Professor Watson shaking his head) Matouk asks: What Financial Advisor worthy of the name would encourage people to do that? Peter (addressing Peter Permel) maybe you want to have a crack at that one.
1:06 Peter Permel: My concern in all of this is the regulators role.
Huh? Is that even close to answering the question?
Or does it expose the agents and the part they played in the fiasco?
1:08 Matouk presses the point with Douglas Comacho laughing at the cheap deflection, Permel continues on trying to deflect the responsibility onto the regulators.
1:12 Permel: Why are we beating up on the advisors, if a breech has arisen because the regulators did not do their job there is recourse.
In other words, breaking the law is okay, the onus is on other people to catch you?
1:24 Permel: There is recourse. That is how the system works Jermey (Matouk).
Matouk: What's the recourse?
Permel: The recourse is to sue the regulators for gross negligence and I can show you the relevant sections under the Central Bank Act.
He goes on to opine on everything to do with suing the Central Bank and when pressed by Matouk brings up Stanford in Antigua, who he is certain was running a ponzi scheme, nothing like what was taking place here.
The regulator was paid off to sign off on Stanford's accounts for six years (and he stresses that) until the United States Securities and Exchange Commission stepped in. Now the fact that we have three years of no accounts at all, and some questionable accounts prior that not even the accountants want to defend, this is different how?
2:30 Permel... and the regulator from Antigua is now in an orange jump suit in Antigua (with a smile), and is now 'assisting' the US Justice Department in prosecuting Stanford.
I wonder what size jumpsuit Peter takes?
2:39 Matouk:Are the investors going to get back their money?
Permel: Are the investors going to get back their money?
Matouk: Yes
Permel: (condescendingly) But that is the whole point Jeremy, what is being brought is criminal charges against those persons.
Matouk: They may lock up one man, but will the investors get back their money? That's the operative question...
Permel: Will they get back their money? Well time will tell on that one..
Hmmm. So what you are saying then is criminal prosecution first, and then possible investor repayment? I agree. Can we all agree and go after Monteil, Duprey and the rest of the forty thieves before the raid on the treasury?
3:00 (Commercial Break)
3:14 Matouk: I want to shift gears here. How would you describe the last Government's handling of the crisis? This crisis began January 30th 2009, I did the show that night I had the regulator of financial institutions Carl Heeralal, Douglas (to Commacho) was here, it's been twenty months since then, how do you describe the last Government's handling of the crisis?
Peter I am going to give you first crack...
3:59 Permel: In principle there was nothing wrong with the plan the Governor of the Central Bank presented on the thirthieth of January two thousand and nine...
Good, so we can hold you to that, right?
In true deflection style, he moves away from the question and deals with information other than what was asked. He goes on to compare that plan to the US bailout of AIG and refers to Douglas in such a friendly manner I wonder if he (Comacho) used to play cards in Xante.
4:59 Matouk: Show me the comparison to Trinidad...
In other words, come back on point Permel, no tap dancing tonight please.
Permel: Reiterates last Governemnt's plan
Matouk: That was the plan. I didn't ask you about the plan. I asked you about the Government's handling (leans into Permel)
ZING! Stay on point or stop wasting people's time.
Permel: (Defensively) I am not a Minister, Patrick (gestures at Watson) is a Governemnt Minister..
Matouk: No no no, Peter the question was how would you describe the last Government's handling...
5:34 Permel: (interrupting and clearly agitated) I don't know! There's no information in the public domain Jeremy!
Huh? Didn't he say at 3:59 there was nothing wrong with the Central Bank's plan under the last Administration?
5:36 Matouk: So in other words, you know nothing beyond the plan...
Hmmm, how will our young Jedi extricate himself from this obvious kill shot?
5:39 Permel: The plan was there, I got a guarantee from the Governor of the Central Bank saying that your money is safe, I went home and I slept well..
Deflection, who would have thought? I thought this guy Permel had some knowledge or information to assist, but as he is just an agitator and has nothing to offer, can we move on from him now?
5:46 Matouk: (Out for the kill now, not letting go, clearly wants to expose this empty barrel) Was the plan implemented? (aimed at Permel)
5:49 Permel: Based on what I am hearing Patrick Watson and his team is saying, it seems as if it hasn't
You were happy for nothing before, and what you're saying is Dookeran upset you by giving you something?
5:54 Permel: But I am yet to hear from the man who came up with the plan
So based on what exactly did you sleep so well Mr. Permel?
6:01 Permel: (Now in full deflective flight, as cocky as he wants to be) Let me say this tonight Jeremy, I am saying on National Television (his emphasis) I am giving the Governor of the Central Bank (and who de ass are you?) Mr. Ewart Williams until Friday of this week (i think that was thrown in as an afterthought, but Friday sounds good so let's stick with it)to make a public statement as to what is the state of play with respect to CLICO (it seems the state of play is Duprey win, you lose, game over) and his plan that he guaranteed the country that their money was going to be safe (not the country my friend, those who fell for the snake oil people like you were selling). If he does not make a statement (what are you going to do?) my group and I are going to call for his resignation (ooooo he must be so shaking now). That is where we are now with this issue.
Steups. Again I ask, who is this clown, who are these 'billionaires' he represent and what was the source of those funds?
6:25 Matouk (smiling) Patrick (aimed at Watson) come in here...
6:27 Well, let me say first of all...(interrupted by Matouk)
6:28 Matouk: I mean it's kinda tough for me to ask you what you think of the last Government's plan...
6:30 Watson: No no no, not at all, when the memorandum of understanding was called I was on record (stresses record) as being supportive of it having no information at the point...
What did you support then?
6:43 Watson goes on to give his opinion of the five billion put into CLICO and the two billion into CIB and (his opinion) the playout (his word) that went 'really bad.' He said people were using the bailout money to pay interest to investors which was against the terms of the lifeline.
7:12 Watson: ...where the comparison with AIG is totally wrong eh (looks in Permel's direction), CLICO was in a process of self liquidation over a time and they were using the seven billion to buy time and they were paying it out to friends and all kinda thing, that is the information we have about what was going on in CLICO...
Hmm, so they were literally stealing money from the taxpayers then.
7:32 Watson: Some people when their policies matured got it, some people got it before maturity...
What are you insinuating sir, that CLICO was mismanaged even AFTER the bailout? Surely you jest!
7:33 Watson: ...and some people's policies matured and they got nothing...
The friendless bunch like Permel's investors?
7:38 Watson: (pushing past Matouk's interruption) I need to say something, we, this Government are now taking legislation to Parliament to legalize the memorandum of understanding...
Are you saying Mr. Permel's grandcharge is based not only nothing, but the lie of nothing?
7:46 Watson: It never became law..
Hmmm. But the plan is still valid, right?
7:51 Watson: It is an illegal document...
Ok, ok, but the Minister of Finance said it was all guaranteed, so it's cool, right?
7:53 Watson: Similarly, the verbal statement of the then Minister cannot be considered a guarantee..
You are killing me here, Professor, how can I defend Mr. Permel if you use logic and reason against all his points?
8:07 Watson: I know Peter (Permel) and them were referring to that statement as well and have reverted now to the declaration of the Central Bank...
Well thank God at least for that...
8:12 Watson: The statement of the Minister at that time, which was a verbal statement, has no basis in law and it never went to the Parliament. She herself is a lawyer and would be the first to admit that (like you know the lady well). There was a budget that followed in September 2009 where CLICO was mentioned, but no attempt was made to legalize either the MOU or anything...
What are you really saying here man?
8:40 Watson: Incidentally, I should mention that those who felt that both what the Governor was saying and certainly the Minister because as far as I know the Central Bank has no money to pay, it is the taxpayer who will have to pay this in the final analysis and then the instrument of that will be the Minister of Finance...
In other words?
8:54 Watson: As far as I am aware and I would want to believe, I don't think the Central Bank Governor is authorized to make that kind of guarantee..
Mother (bleep) (bleep) Central Bank (bleep), are you serious man? So what DO we have then?
9:00 Watson: That is a point I would like lawyers to respond to. So when these things are brought before us in this way, even Karen Tixiera Nunez (his renaming, not mine) said (looking skyward) and I am sure she said it in the 2009 budget but she certainly said it in other fora, that not one sent beyond the five billion that she put into CLICO, and there was a further two billion that people must not forget eh, that they put into the CIB, so it was seven billion in all. She herself said that the Government was not prepared to put a single cent more, so when you talk about handling the crisis, they made the initial foray, a lot of (some big french sound word that sounded like bravado) but nothing else followed.
Mr. Permel, all I can say is that your claims have all been exposed and debunked.
Sorry, but if it's any consolation you are not the biggest loser. The people of this country are, the taxpayers, and the small investors who did not know better.
This CLICO debacle is starting to look like a bottomless pit, and I would greatly appreciate it if the Government does not use one more cent of taxpayer money until:
- We know the full and final bill for this mess
- Messrs. Duprey, Monteil and others are charged and prosecuted for this mess and their property confiscated and liquidated to repay investors/shareholders/policy holders
- Messrs Heerala and Williams are relieved of any further mucking up of the financial system. I strongly suggest they be given their own show though, a local version of Beavis & Butt head.
On the second link, Mr. Permel realizes that his arguments have all been shown for the sham they were, resorted to gangsterism. He is on record here threatening the country and the Government and I am still trying to figure out why he has not been cautioned as yet, if not charged with sedition.
Second video:
This video is made up of much conversation on the issue, but I would like to highlight this section:
9:01 Permel: (solemnly) I want to caution the present Government (dramatic pause), they have to tread very cautiously here, the people who have that twelve billion dollars who represent that twelve billion dollars of liability, they are not hand to mouth people, they are people who have investments in other financial institutions (veiled threat?) and they can be very disruptive (overt threat against the financial system?) in terms of this financial system. So we are trying to keep the thing together, we are saying let's sit down and talk this thing through (mafia style?) and let good sense prevail. Because if those people start to give problems, you could have real problems in the system.
That statement contained at least one threat against the people and the stability of the country through disrupting the financial system, and I suggest to the Attorney General that Mr. Peter Permel is at best imflamatory in his statements and is abusing free speech, and at worst seditious and he should be charged. This display is a slap in the face of law and order and rewarding this abhorrent demonstration will only lead to further strains in an already stretched system.
In the final analysis (my own) there may be other ways to solve this crisis, but ganging up against each other and fighting down the people, the Government and the taxpayers is not the best way to go about it.
We have a proposal from the Minister of Finance that seems to make the most sense at this point.
When we have the final balance sheet we will all then be in a better position to say if his call was a good one or a not so good one. Until then, we need to show some restraint.
To all the snake oil salemen from the CLICO days, well done, you have proven beyond the shadow of a doubt that crime does indeed pay. I suggest you leave town with your loot though, because at some point the investors who lost all on your advice may not take to kindly to your oppulent lifestyle while they 'catching ass' to recover from your swindle.
To any and all future investors, my best advice to you is that you learn from the Arabs. They have a saying; 'Trust in Allah, but tie your camel.'
To be continued...
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