Has Extensive Connections With Barbados Government and Elites
Trinidad & Tobago’s new Minister in the Ministry of Finance has been accused of fraud by his former Barbados-based employer.
According to the Trinidad and Tobago Express (link here), a civil lawsuit filed in Supreme Court in Barbados in 2004 says Mariano Browne “breached his fiduciary duty” by doing all kinds of nefarious activities including…
– Making unathorised payments to himself and others.
– Purchasing an unauthorised car for a “senior staffer” Cheryll Drakes using the bank’s funds. Apparently Browne liked Ms. Drakes a lot!
– Paying unauthorised and undocumented “bonuses” to himself and other staff.
– Removing and destroying a laptop computer with the bank’s business records on it. (Gotta get rid of that evidence, ya know!)
– Activities euphemistically called “accounting irregularities”.
Browne and his lawyer Alair Shepherd say its all a big misunderstanding. They say that Browne was hard done by during some business dealings with the bank.
Other companies and persons are mentioned in the lawsuit including…
– MB Investments Inc (Mariano Browne’s company)
– Bank owner at the time CLICO
– CL Financial
– Andre Monteil
– Bank of Butterfield
– PriceWaterhouseCoopers (a Canadian accounting firm)
– Fraudulent payments to law firm of Clarke, Gittens & Farmer
– Central Bank of Barbados
– Barbados Coast Guard relocation project
– New Barbados Judicial Center
– Government of Barbados, which provided a “letter of comfort” to Browne during some of the suspected fraudulent business dealings.
Lawsuit Was Hidden By The Barbados Court – Did Chief Justice Simmons Know?
Even though the public is only now learning of the lawsuit against Browne, we learned today that this lawsuit was actually filed in the Supreme Court of Barbados in 2004.
How is it that such a major lawsuit involving government projects and major financial institutions, businesses and law firms could remain secret for three years?
This would have taken the knowledge and co-operation of the Barbados Judicial system.
Dear readers, we at BFP are not lawyers, so maybe we’re wrong here – but it seems to us that keeping this lawsuit secret from the public and shareholders would have taken the participation and direction at the highest levels of government and the courts. Did Chief Justice Sir David Simmons know of this? If yes, what does that say about our courts? If he didn’t know about it, what else is going on in the Barbados courts that is secret?
We don’t expect any answers from Simmons and the government – for the Chief Justice and the Government are two arms of the same body.
Reprint of Trinidad & Tobago Express Article on next page…
From the Trinidad & Tobago Express (link here)
CLOUD OVER NEW MINISTER
Bank sues Mariano Browne for embezzlement
Special investigation by Camini Marajh email@example.com
Sunday, November 25th 2007
Prime Minister Patrick Manning’s new Minister in the Ministry of Finance, Mariano Browne has been accused of financial impropriety and corporate misbehaviour by his former employer, the Bridgetown-based Caribbean Commercial Bank Ltd (CCB), now RBTT Bank Barbados Ltd.
A civil lawsuit filed in the Supreme Court in Barbados in July 2004 by CCB’s new owner, RBTT Bank and its previous-owner, CLICO Holdings Barbados Ltd, claims that Browne, the former president and CEO of CCB, breached his fiduciary duty and the bank’s rules and procedures by, among other things:
– Making unauthorised travel payments to himself and other senior management staff
– Paying bonuses and interim bonuses to senior management staff including himself in an ad hoc and irregular manner without adequate documentation and/or Board approval and failing to make the necessary tax deductions
– Purchasing a 2003 four-door Honda CR-V for Bar$101,400.75 for senior staffer Cheryll Drakes which exceeded the approved limit by Bar$36,400.75
– Removing and destroying a company lap-top computer hard drive and
– Committing accounting irregularities related to a Bar$39.5 million bond issue which caused financial harm to the bank. The two corporate giants are seeking some Bar$8 million in damages.
Reached in Barbados on Friday, Browne denied all of the allegations contained in the court papers filed against him and his company, MB Investments Inc and deferred comment to his lawyer Alair Shepherd. In Browne’s defence, Shepherd held that his client “did no more or no less than previous heads of the bank” and that Browne was in fact following “the procedure adopted by previous managers” when he approved bonus payments.
Shepherd said when Browne went to CCB in January 2002, the bank had: “No cash, was making losses, had a poor loan portfolio and owed the Central Bank of Barbados money.”
He told a story of a loss-making CCB coming to profit under the management of Browne, who, he said, has “always felt hard-done by, in circumstances where he had taken the bank from a loss-making position to a position where CLICO, its shareholder, was in a position where it could make a substantial profit on sale.”
According to Shepherd, relations between Browne and his former employer soured after CLICO allegedly reneged on a lock down agreement to sell its shareholding in CCB to a Brown-engineered management buy -out.
But the CLICO and RBTT court pleadings denied claims of an agreement to a management buy out and, instead, accused Browne of claiming a travel allowance of Bar$9,767.19 for personal travel to Bermuda in October 2003 for the specific purpose of facilitating the sale of CCB to the Bank of Butterfield, Browne’s employer up until a week ago.
Shepherd said he was “not at liberty” to reveal the identities of the persons who made up the consortium for the management buy-out put together by Browne on a question of whether Butterfield was a financer to the deal.
Court papers said that Browne made a private trip to Bermuda without the knowledge and or approval of the board. Shepherd confirmed that his client sought an injunction against CLICO to prevent that company from finalising a deal with RBTT but in the end things turned on the construction and interpretation of a CL Financial/Andre Monteil agreement letter.
The prevailing view in Barbados, according to Shepherd, was that the Monteil agreement was not enforceable since CCB was a wholly-owned CLICO Holdings Barbados subsidiary and the requisite board approval had not been obtained.
The former CLICO-owned bank, then in negotiations with RBTT, terminated Browne’s contract in January 2004 and gave him a Bar$800,000 payout. But in court filings, following a forensic audit by a Canadian team of accountants from the firm, PriceWaterhouseCoopers, RBTT/ CLICO is demanding repayment of the Bar$800,000 which they contend was paid “in error pursuant to the contract for services as a result of breaches of contract.”
The forensic report allegedly found that Browne overstated commissions on financial transactions and engaged in accounting irregularities. According to the court documents, Browne authorised the processing of bonds issued by the bank in the amount of Bar$39,583,179.70 in connection with a Coast Guard relocation project without the investment receiving the requisite Central Bank approval in accordance with the Financial Institutions Act.
The lawsuit claims that he proceeded to issue zero-coupon certificates of interest in the bonds without the related trust deed and other documents required to facilitate project financing. There were also claims that the investment company had not been properly established.
In Browne’s defence, Shepherd said while the lawsuit referred to a lack of government guarantee, his client had a letter of comfort from the Barbados government. He countered that “a certain amount of urgency” was imposed upon the bank by the Government of Barbados. And while he conceded that: “Monies were, accounting-wise dealt with and paid without tidying up of full documents,” the same thing was done with the judicial centre and there was no howl of protest.
The court papers, however, contend that Browne was responsible for the sale of certificates, purportedly issued by the bank, in a security which did not exist. There were claims that his negligence caused “actual economic damage to the Bank.”
The lawsuit also held him responsible for entries (in the financial records) purporting to be arranger’s fees and commissions earned on the certificates.
The lawsuit contend that Browne and his company in fact received year-end bonuses from overstated commissions. The court documents said that the issue of zero coupon bonds without proper or lawful authorisation made the bank liable to interest payments to investors on bonds amounting to some Bar$1.8 million and legal fees of Bar$101,964.18 to the law firm of Clarke, Gittens & Farmer.