TWO QUIT
By Ria Taitt
The CLICO board has collapsed.
In a major slap to Central Bank Governor Jwala Rambarran, and in a most unwelcome development for the Government, two directors of the CLICO board, Jagdeesh Siewrattan and Denyse Mehta, have resigned on principle, citing the Central Bank Governor's “unfair, unjust and insensitive” dismissal of ex-chairman Gerald Yetming and managing director Carolyn John.
The board, which is supposed to consist of five directors, now has only Krishna Bodhai and Wendy Ho Sing, the new executive chairman. But with this fragmentation of the CLICO Board, created by the resignations, there is now no quorum.
Siewrattan's letter of resignation, dated June 12, 2015, and Mehta's letter, dated June 14, 2015, both copied to Minister of Finance Larry Howai, have come in the wake of the June 5 dismissal of Yetming and John, following the controversy over payments to former CLICO directors.
Both Siewrattan and Mehta were critical of the Central Bank's handling of the situation and corroborated Yetming's claim that the Central Bank knew and supported the decision of CLICO to pay the former directors and at no time indicated its opposition until after public controversy developed.
Mehta suggested the Central Bank's behaviour was “unethical” because of its failure to acknowledge joint accountability in the matter. In standing in solidarity with Yetming and John, Siewrattan said if they were dismissed, then so should he.
In her letter, addressed to the Governor, Mehta, who was appointed on September 31, 2010, stated that it had become untenable to continue on the board in view of the “unfair, unjust and unprofessional treatment meted out to my fellow directors, Gerald Yetming and Carolyn John...by you, with great disrespect”.
In complaining about the manner in which Yetming, a former minister of finance, and John were treated, Mehta said: “In addition to them not being given the chance to defend themselves, they were falsely charged with 'trumped-up' allegations that they did not follow instructions regarding approval of payments by the Central Bank to residual STIP holders”.
Mehta stated that at the board meeting of April 29, 2015, an update on the payment plan for non-assenting STIP holders was provided. Given the “Clico Resolution” by the Central Bank, it was the duty of the managing director to execute this plan with the Central Bank officials.
“There was a clearly established protocol for operating as this was not the first payment plan to be executed. There was no objection by any director or from the Central Bank representative, Mr Neil Dingwall, at the board meeting about the plan. Neither was there any objection from Mr Dingwall when it was mentioned that related parties would not be treated differently, an opinion shared by you, Governor, on public television, where you stated that all creditors must be paid.”
Mehta said notwithstanding these statements, there was a clearly-defined and well-established payout process with the Central Bank, which involved senior officials such as Carl Hiralal, Nicole Chapman, Neil Dingwall and Denise Daniel.
“It is my understanding that all of these members participated with Ms John and Ms Hoyte from CLICO. I also know that payments were fully under way by May 13, 2015 and by the last meeting of June 3, 2015, the board was informed that 219 applications were already processed with no expressed concern raised by Neil Dingwall or the Central Bank,” the letter continued.
Mehta stated further that at a special board meeting of May 12, 2015, a letter from the Central Bank was presented where CLICO was directed not to pay Ms Gita Sakal, or any other defendants of the fraud on the public proceedings.
“Given this expressed statement, it is my knowledge that this direction is what was acted upon by Ms John and by extension members of the Central Bank. No other variation in the payment plan was presented to the Board to change our direction,” Mehta stated.
She added: “It is therefore against the principles of natural justice to suggest that the chairman or the MD acted unilaterally, especially as this was a joint process. I therefore plead that only after it emerged in the press that the former directors were paid, and there was a public uproar, that procedural infringement was claimed, leading to the dismissals nearly one month after the payouts commenced. I contend that it was highly unethical of all the Central Bank officials to take no joint accountability for the plan that was already in process.
“I therefore feel that the values espoused by the Central Bank in the handling of this matter are not in sync with my own personal beliefs and I stand with my dismissed colleagues and recognise our sterling contribution made in the recovery of CLICO.”
Mehta said she fully endorsed the work involved in the turnaround of CLICO spearheaded by chairman Yetming, who led a decisive and honourable team, supported by the exemplary work of John, “the front, middle and back of the rebuilding of CLICO”, leading to increased confidence by the Government, policy-holders and the staff at the institution.
Siewrattan says:
Siewrattan said the reason for his resignation was the “insensitive dismissal of the two players who played the dominant role in the recovery of CLICO (Yetming and John)”.
Siewrattan also stated that throughout the deliberations of the board, its members, led by Yetming and John, “paid meticulous attention to directions from the Central Bank”.
“Messrs Yetming and John were in constant contact with Central Bank staff. Decisions taken were always based on collegial consensus basis. On these grounds, I plead that the basis for dismissing them ought to apply to me as well. Hence the submission of my resignation,” he stated.
Like Mehta's letter, that of Siewrattan referred to the fact that John, a former CLICO employee who was in retirement when CLICO collapsed, made the sacrifice of returning to rebuild the institution.
“In a situation of declining staff who sought greener pastures, she stuck steadfastly to the task at hand, working long hours not only to maintain the administrative workload, but was the institutional memory bank for lawyers, accountants and management consultants who populated CLICO during this trying period,” Siewrattan stated.
Noting that she was the chief witness at the arbitration proceedings of MHTL (Methanol Holdings), Siewrattan said John was the intellectual database for a diverse set of information required for charting CLICO to safety.
Like Mehta, Siewrattan resigned from MHTL as well. He said as a result of his CLICO directorship, he was also on the board of MHTL and Oman Methanol Company and that those companies should be advised of his resignation of their respective boards.