CLICO Indian Fraud: Should Leroy Parris and Lawrence Duprey go to jail for this alone?

Leroy Parris and good friend Government Minister Chris Sinckler share champagne

My friends, you should go to Trinidad and Tobago Newsday to read this article, AND PLEASE DO!

But just in case it disappears from the net as happens in the Caribbean, we’re going to reprint the entire article here. But please… go to Newsday first to read the whole thing, okay?

WARNING: If you’re a CLICO victim, you’re going to be mad as hell after the first paragraph!

‘Clico fronted $38M in Indian business’
By ANDRE BAGOO Monday, October 3 2011

CLICO fronted $38 million in Indian business carried out by a Miami-based broker without the approval of the Central Bank, according to documents disclosed to the Commission of Inquiry into Clico which paint a picture of an insurance company with a long history of breaking the law and hiding key aspects of its operations from its books.

The documents disclose that $29.4 million in interest payments on a secret $302.4 million Home Mortgage Bank loan to Clico for the Lascelles de Mercado transaction was dressed up as “an amount receivable” from parent company CL Financial. Additionally, the company had “significant off balance sheet exposures” to connected companies totalling $2 billion, according to Central Bank estimates.

In a Central Bank letter dated December 9, 2009, the Insurance and Pensions manager of the Financial Institutions Supervision Department Sharon Braithwaite wrote Clico to confirm the minutes of a meeting held with the department’s officials and officers of Clico on November 25, 2008.

“Clico stated that they have been writing reinsurance business for approximately 18 months,” Braithwaite said. “The business, valued at approximately US$5-6 million, is written in India and is handled by a broker, American Assurance Underwriters Group LLC (AAUG), which is based in Miami.”

“Clico further advised that AAUG sources the business directly in India and reinsurance is ceded to Clico. Clico has an arrangement to retrocede the business to a division of AAUG and receieves a commission on the retrocession,” Braithwaite said. “In effect Clico is fronting the business.”

However, she noted that all premiums were held in an account to pay any claims. But this reinsurance business was not approved by the Central Bank.

“Clico also indicated that they were previously of the opinion that the transaction of reinsurance business did not need the approval of the Central Bank. However they were made aware that this is no longer the case and have now approached the Central Bank for approval,” Braithwaite said.

In relation to the $302.4 million HMB loan, the terms of which expressly included that it be kept confidential, the accounting for the interest on the one-year loan, at a rate of 9.75 percent, was not reflected in the Clico accounts as an expense.

“The Central Bank expressed concern with the accounting treatment of interest expense in respect of a loan in the amount of $302 million from the HMB in the September 2008 Quarterly Returns,” Braithwaite noted. “Clico remitted the proceeds of the loan to its parent company, CL Financial Limited for the purpose of financing a business acquisition (Lascelles de Mercado).”

“The interest expense on the loan to Clico was not reported as an expense in the profit and loss statement but was recorded as an amount receivable from CL Financial Limited. This accounting treatment effectively understated the actual interest expense for the period.”

Another document, a note dated February 12, 2009, submitted by the Inspector of Financial Institutions Carl Hiralal to Central Bank Governor Ewart Williams and advising Central Bank intervention, noted off balance sheet exposures at Clico.

“Clico has significant off balance sheet exposures to connected companies totalling $2 billion,” Hiralal said. “This exposure is made up primarily of a $1.5 billion guarantee on behalf of Capri Limited (a CL Financial Company) and $0.45 billion in loan guarantees for the parent company CL Financial. Capri Limited is involved in real estate developments in Miami, Florida, an area that has experienced a fall in real estate demand and market prices.”

He noted Clico’s long history of breaking insurance laws.

“Clico has a documented history of not respecting the obligations imposed on insurance companies by the Insurance Act,” he said. “The company has over the years committed several breaches of the Insurance Act many of which continue as at the date of this report.”

The breaches included: issuing insurance policies without approval of the Central Bank (violating Section 119 of the Act); writing insurance business outside of Trinidad and Tobago without the approval of the Central Bank (violation of Section 12(1) (c) of the Act) and failing to submit all information requested by the Central Bank over this business; appointment of directors without notification (breaches of Section 20, 21, and 23 of the Act).

In relation to the latter breach, the Central Bank noted that, “although this breach was subsequently addressed, the company’s behaviour demonstrated the scant regard it has for the requirements of the Insurance Act.”

In another note of the same date in relation to CL Financial subsidiary British American Insurance, Hiralal noted accounting policies which understated policyholders’ liabilities.

“The liability reported in the statutory filings was inadequate given the level of the credited interest guarantees and the yield earned on the assets available at December 31, 2006. The reserves stated in the 2007 statutory accounts was not adjusted for the inadequacies in the actuarial methodology and it is projected that this understatement of the reserves is expected to worsen in 2008.”

BA, too, had little regard for the law, according to the Central Bank.

“BA has demonstrated scant regard for the requirements of the Insurance Act regarding the maintenance of the statutory fund as required under Section 37 of the Insurance Act,” Hiralal said. This, he said, was “despite the Central Bank’s request of the last three years to remedy same.” An onsite examination by the Central Bank between February and April 2008 revealed that the company breached Section 119 of the Act by issuing an insurance product that was not approved by the Central Bank. CIB also adopted, in the view of Hiralal, an “inappropriate business model and poor risk management.”

“BA has poor governance practice,” he said. He noted that only two board meetings were held in 2008 and that one executive director who served as chairman was suspended in September 2008, yet continued to draw “remuneration as chairman”.

26 Comments

Filed under Barbados, Business & Banking, Consumer Issues, Corruption, Crime & Law, Offshore Investments

26 responses to “CLICO Indian Fraud: Should Leroy Parris and Lawrence Duprey go to jail for this alone?

  1. Superfine

    I would like the Minister of Finance to explain the $40 million paid or to be paid for redesigning the marina at the Pierhead?

    Owen I suggest you enquire into the matter fully and see who’s greasy fingers have left finger prints. I think think you should actually promise Bajans that upon returning to office, you intend to investigate this matter fully and without fear or favour.

  2. Big C**t

    Man lock them c**ts up like shit according to Rihanna

  3. rasta man

    @superfine.: Do you really think there is any difference betwen Bees and Dees????Too much under the carpet to disclose .Only a lot of talk.

  4. just want to know

    One picture tells a thousand words. Thanks BFP.

  5. Superfine

    Thats Cristal Brut Rosé champagne they are drinking, the only one Leroy likes and apparently the Minister of Finance too. Bds$1,450.00 a bottle, oh how quickly we acquire the taste for the GOOD life.

  6. millertheanunnaki

    Can’t have a more accurate description! A picture tels a thousand words!

    The things that some women (and men) do for money or material prosperity never cease to maze.

    It is said that bisexual males run the risk of infecting their female partners with hepatitis C as a result of transferring faeces from one hole to the next. I think Bajans have a phrase for it: something like “s**te in the blood”.

  7. rasta man

    @millertheanunnaki: Oops,what are you insinuating here?

  8. Superfine

    @ millertheanunnaki

    Thats pretty brutal but then again a good friend of mine in the DLP says amongst the fellas they regularly use the term “almost bulling” to refer to those who started out staight at the beginning of the term but due to the pursuit of material wealth was now “almost bulling”.

    Go figure.

  9. Superfine

    Even according to die hard DEMS, there are too many hens in the party, too few cocks and some who run ac/dc current.

  10. millertheanunnaki

    @ Rasta man & Superfine:

    Let’s reason together. We seem not to belong to that run-of-the-mill and myopic mass of society who sheepishly accepts as gospel everything coming from authority figures (whether in the church, politics, law or medicine). At least I hope so!

    Now figure this one out! How come a man with little education, no claim to any special intellectual ability, business acumen, charisma or charm- not even a convincing bullshit artist- can rise to the top of a fraudulent pyramid. But then again, he was still able to entrap many so-called educated, but greedy and gullible, big shoots into his web. You can forgive the average Joe and Jane who were taken in by the slick tongue, smartly attired policy sales pushers. We should also feel sorry for the poor punters whose employers (or representatives) placed their hard earned pension contributions in a suck well because of greed, personal kickbacks through commissions or as favours in return for becoming members of the same club as LP, DT, FS, CS et al (some on the other side of the political divide were once members, too!).

    As you can figure out by now it did not take a lot of fine attributes or good character ASSETS to move up the pyramid. Just sell your CORNWELL and you will get humongous salaries, millions dollar bonus, massive houses at your disposal , private jet to fly around on and Merks park at your door; the values of which woefully under-reported to Inland Revenue
    year in year out to cheat the tax man.

    Superfine , you see why your comment is so apt?

  11. FearPlay

    Bernie Madoff, Allen Stanford, Robert Jennings and their ilk were unable to avoid facing justice before the law courts. What will the world think of Barbados, Trinidad and the Caribbean if we are unable to deal with a Ponzi Scheme of this magnitude. It would seem as if we are pussy-footing around this whole nasty mess. If a teenage boy is caught with two cigarettes of illegal origin they face jail time yet we have formerly (brilliant?) respected business people driving around in brand name cars, owning brand name homes, living in brand name neighborhoods, drinking brand name beverages, owning brand name bank accounts and not even a hint that something will be done to bring justice to this horrible crime against people of the region. If politicians are/were involved, well the piper still needs to be paid, here and in the twin island Republic.
    I believe that we should not be too hasty to idolize and immortalize recently departed souls until this whole sordid mess is resolved. Where oh where is Wikileaks when we need to know what went on behind closed doors? Or do they only expose the wrong-doings of Governments?
    BFP, it is hoped that you adopt this dastardly undertaking with the same rabid fervor with which you apparently pursue Rihanna. DO NOT LET THIS DIE BECAUSE MAINSTREAM MEDIA REFUSES TO INVESTIGATE AND PUBLISH TRUTHS. Keep it in the news everyday.

  12. Concerned

    Fear Play!!!! Absolutely!!!

    This should not be allowed to “disappear” . It is criminal and they should be made to answer for there involvement and if guilty serve the time!! They had no problem living the high life with othere people’s hard earned money. Now they should have to answer for there actions. It is time to pay the piper!! (The poor folk who invested there hard earned savings with those criminals).

  13. watcher

    Maybe the FBI should be asked to look at the whole messl. Some of the assets of Clico and some of the policyholders might just be in the USA.

  14. millertheanunnaki

    @ watcher:
    The FBI will only get involved if fraudulent activity took place in USA territory or against its citizens. But as far as the Barbados scene is concerned nothing will happen because the perpetrators have very good friends in high political circles who will have much to lose if things are exposed.

  15. It's Time

    A quick search for officers of registered business in the Florida division of corporations at http://www.sunbiz.org makes for interesting reading. Maybe the FBI should read too.

  16. October: The Month Very Few Will Ever Forget

    September may be the month to remember but October will always be, ‘the month very few will ever forget,’ especially if you are talking about October 2010. From great leadership, Barbadians saw politics fall to its lowest. But last October would have started painfully for some and nicely for others. Take Mia Mottley for example!

    I kid you not, when I say that as a new, energetic and visionary Leader of the Opposition, Mia Mottley had already given two remarkable speeches, one at the BLP’ Annual Conferences, held in 2008 and the other speech at its Conference in 2009. Those remarkable presentations captured the imagination of the people: they were new; fresh, inspiring and innovative. By 2009, the BLP was having public meetings and community meetings, which were very well attended, and it was obvious why DLP supporters were beginning to get worried.

    By September 29th 2010, when she gave a well-reasoned presentation at the Barbados Chamber of Commerce and Industry (BCCI) and outlined a new path and a new development model for Barbados, some might have felt that she had to be removed then because their time was running out. And, with the health of our Comrade Leader, David – deteriorating rapidly, ‘the politics of opportunism’ kicked-in and Barbadians say the worst of Bajan politics, as the “Gang of 5” made their secret plot public and they made ‘a raw and opportunistic grab’ for power.

    I have seen political parties and leaders operate and I can say that as Opposition Leader, Mia Mottley flew the flag and genuinely offered to help and to work with the new; relatively inexperienced Government, in the national interest. That was a new politics and something Barbadians had not seen before. What I can also say for her is that Mia Mottley did not wait until the people expressed concern about an issue to jump-on-it. It was often Mia Mottley who sounded the alarm on issues, like: the Government’s petroleum policy, its Immigration Policy; Clico, the economy, NHC and the government’s housing policy.

    Up until October 18th, 2010 when she was ousted as Opposition Leader, it was almost left single-handedly to Mia Mottley to defend the BLP’s record and stewardship for the 14 years previous. It was David Thompson’s Parliament and those BLP Parliamentarians (who only gain mock-courage after his death) simply ran from the House like mock-men, whenever David was there, while others among them, turned-up but remained silent in “David’s House.”

    October is therefore the month many will never forget because it was like licking honey from the edge of a new razor! Mia celebrated a birthday on October 1st. Our leader’s health deteriorated rapidly during October. Mia Mottley asked the country to pray for Prime Minister Thompson. But while many were praying, a few others were meeting and “preying” with an entirely different agenda: power.

    By October 18th, 2010 and with it clear that PM Thompson was dying – Mia Mottley was hastily removed as Opposition Leader, by the very people who Mr. Thompson had kept under control since 2008. These were the very people who hardly went to Parliament or went but said absolutely nothing. Then there was Tropical Storm Tomas and the shocking news that our leader: Prime Minister Thompson had died.

    October and in particular – October 2010 – will always be a month that Barbadians will never forget. Our Prime Minister died and even now – under the guise and mock-concern for the Economy, the BLP is still trying to benefit from his untimely death. October is the month when Barbadians usually see the very worst of the “politics of opportunism,” and the upcoming BLP annual conference and war games, is unlikely to be any exception.

  17. FearPlay

    Interesting post but it has nothing to do with the subject. Plase do not be distracted. Stay focused.

  18. millertheanunnaki

    @ FearPlay;

    Totally agree with you! There are forces at work to downplay and cover up the CLICO fraud because many people in what we call positions of authority (big ups in society) have benefited financially from the scam and fear being exposed either by LP squealing on them (do a Dudus Coke) or by investigation by international agencies.

  19. Distant Voice

    wow that was a lot to read. Yes they all need to be exposed and put in jail. If this is not done, the rot will continue to spread. Crime of this magnitude is now a political issue. So many dirty hands in this one. Time to remember that those appointed to represent us, work for us and are paid with our money.They are supposed to SERVE us. Remember that title “Civil Servant” ..or is the word “servant” not PC anymore?

    It will be up to us to make sure justice is served. Not them!!

    So dont ask why those slick suited bastards are still free. It’s obvious. Hopefully we have enough corporate lawyers and accountants on this island to help nail them, and with the backing of the masses (us simple folk) we can insist that justice prevails.

  20. millertheanunnaki

    @ Distant Voice:

    We hear your plea! But, like the biblical character John the Baptist, you are a voice crying in the wilderness.

    Don’t you see how the local CLICO JM enquiry is being played out? Lots of hot air, numerous options put on the table, totally unworkable, but placed there to further obfuscate the mess of fraud perpetrated by a con man and his minions (who, by the way, are still being paid by policyholders’ premiums – TT & Mr. B). The con man continues to drive around Bimshire in fancy car living large from his ill-gotten gains and laughing at silly Bajans who have been conned out of their hard-earned savings.

    The BIPA spokeswoman needs to step up the pressure on this DLP administration. The thieving and rot may have started under the previous administration. But this administration stuck its neck out and vehemently declared that CLICO was financially sound and well managed by a brilliant and hardworking Barbadian. After news of the pending disaster broke in January 2009 this Administration showed its bias and incompetence by pumping more money in the suck hole, and promising policy holders that there is nothing to worry about and they (the government) will guarantee and protect their investment. Those who had insight of what was really going on in CLICO were branded as anti-DLP, people who don’t like to see a black man succeed and get rich, political opportunists whose attempts to expose the whole scam were described by the con artist’s pals in very high places as tantrums that should be punished with laughter.

    Policyholders, take some advice! The only way you will get anything back is if the governments in the Eastern Caribbean inject in excess of U.S. $150 million and the saleable assets liquidated. The chances of any government- especially Barbados who is one step away from the IMF door with begging bowl in hand- coming up with that kind of cash are extremely remote. Even if you were to apply a bit of political blackmail by threatening to vote them out of office at the next general elections (get a petition going to this effect with the signatures of policyholders and fair-minded people) you will still be “kicking the can further down the street”.

    The only parties that will benefit from this CLICO scam are the vulture accountants who are already removing the “thin cash flesh’ still attached to the decomposing skeleton.

    BIPA, you could as well whistle down the wind! Time will heal but no one will pay for losses either through repossession of ill-gotten personal assets or spending time in St. Philip.

  21. Sunshine Sunny Shine

    Are there any other persons besides me laughing their assess off at how gullible Barbadians have become. CLICO and their beneficiaries got millions of policy holders investments wrapped up in their own sick ass deals. The government of Barbados bail out the crooks with 10 million yet they still going under. Now CLICO the crooks offering a deal after accepting people’s hard earn dollars and other investments and what is the government doing. Not one C…….T. Who are the beneficiaries of CLICO’s dirty deeds….YOU GUEST IT… Hit out at dem and beee very weary of the others who riding on this because their closets just as filthy.

  22. FearPlay

    See how easy this dropped off the radar? Not one damned thing, not one step of progress has happened since this original post. This is such a great example for tomorrow’s criminal to follow. Just compare, female senior-citizen picks up a chicken at the supermarket and is unable to pay for it so she secretes it on her person, is seen by security, arrested and charged. Pretend to be a genius businessman, steal billions, buy a politician or two then live a life of luxury without fear of arrest or retribution.
    Will UWI return the millions donated to that institution because the money is tainted? That would be quite an example to set and could maybe start the ball rolling, ya’ think?

  23. rastaman

    @fearplay.: You really think Sir Hilary will give back any money. He needs all he can get to pay Curtley Ambrose as BOWLING CONSULTANT!!!

  24. Newbie

    God help us all with the choices of leadership that we have before us.
    Remember if the HEAD AIN’T GOOD then the body have got real problems.
    The heads of Clico and all those involved in this debacle should be imprisoned if only based on incompetence but I don’t think that incompetence have anything to do with it.

  25. Rafael Villa

    Check AAUG carefully.They have a real scandall in Colombia, SA, with their parters AFIANCOL

  26. FearPlay

    October 4, 2011 is the date of the first response to the original post. October 4, 2011!!! Can you imagine that? Almost three years later and not one damned thing has changed. Not even a charge for speeding has be brought against any of these criminals. About the only thing that is different in all this time is someone declaring that another person is a friend and does not have leprosity. Now that’s a standup kind of guy bought lock, stock and barrel. Where else in this world could a government authorize a ten million dollar endorsement to a private company on the advice of the PM because the Chairman of that company was his friend with whom he had an incesturous relationship (business). Anyone who has ever had anything to do with that company should be thoroughly investigated.