Scandalous Wheeling and Dealing at CL Financial

Most shocking

Newsday Editorial
September 21, 2011 – newsday.co.tt

Lawrence Duprey and Andre MonteilScandalous is the word for revelations about the behind the scenes wheeling and dealing at CL Financial, the cooking of the books, the hiring of a convicted felon to serve as the group’s global representative and other dubious deals geared toward fulfilling one, single-minded objective: the establishment of a global empire.

Testimony given to the Clico Commission of Inquiry on Monday by former CL Financial chief financial officer Michael Carballo was both riveting and shocking. Speaking frankly, Mr Carballo explained how greed and naked ambition brought CL Financial to its knees and made Clico bankrupt. According to Carballo, funds for purchasing companies in the USA and Europe to expand the group’s domain, were borrowed using Angostura’s good name and when the deals went bust through a lack of due diligence, the losses were placed on Clico’s books, making policyholders liable for all risks involved in dicey decisions made in the boardroom or by former executive chairman, Lawrence Duprey. Carballo said by 2008 when he took over as CFO, CL Financial had $3.3 billion in debt to Clico and it was company practice to keep risking deals off Angostura’s books by arranging inter-group funding to mask ventures. It is thus no surprise that Clico became insolvent and that policyholders lost their investments.

Evidence in this inquiry is revealing that the CL group employed a Machiavellian approach to doing business, that to the executive and Mr Duprey, the ends justified the means. CL Financial was prepared to become a global brand at any cost and that included transferring debt from subsidiary to subsidiary in a high stakes shell game which risked the founding company, Clico, established by Mr Duprey’s uncle, Cyril Duprey. The group also saw no conflict in hiring a global representative with a record because the man had allegedly useful international contacts.

Carballo told the inquiry that the company employed at a great cost to the company, CL World Brands chief executive Arnaud de Trabuc who had been jailed for mail fraud in the US because he was the man that senior management at CLF regarded as their man in Europe and the man who Duprey thought would bring him the global deals he wanted. The result of hiring a fraudster: the group made risky deals and the fraudster made a fortune from commissions and side deals.

“Lawrence (Duprey) saw a benefit in it even though Lawrence knew there was a risk. I think Lawrence was willing to live with the risk of Arnaud for the benefit of making contacts. Arnaud had his benefits even though he was jailed for mail fraud,” Carballo said.

The tale of CL Financial is similar to that of financial institutions which triggered the global economic crisis: a solid company, unregulated by the State, overextended itself into collapse. Much as the bankers and investors in the US and Europe, CL Financial was given free rein to use the funds of the man on the street to gamble. It is also evident that Lawrence Duprey was running a public business like a private fiefdom.

The clean-up and crackdown of the group has come too late for many who have lost their savings and it is truly difficult to understand how Clico could have been allowed to function as an unsupervised private company when it was taking public monies for insurance policies and was a member of a group that comprised a total of 289 entities in 32 countries in the areas of real estate, financing, spirits and energy. In the absence of scrutiny, the public’s money became the private piggy bank of speculators and now, once again, the public´s money is being used to rescue and recompense policyholders.

There is one line of testimony which reveals Mr Duprey’s sangfroid towards losses which put the company in jeopardy.

“I think Lawrence Duprey recognised he made a mistake,” Carballo said. “Lawrence is not necessarily fazed by those things because in business, business is risk.”

But Clico was not only about business, it was about people, ordinary people who believed in the company and entrusted it with their savings and the risk taken was not Duprey’s but theirs. It was their money he was permitted to gamble and which he lost.

Had Lawrence Duprey not flown so close to the sun, he might have remembered the earthly words of his deceased uncle. “Give a man value, give a man service and he will support you” was the philosophy of Cyril Duprey founding father of Clico. Cyril Duprey must be turning in his grave.

http://www.newsday.co.tt/editorial/0,147585.html

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$206M FEE
THOUGH he resigned from the CL Financial Group in April 2008, former group chief financial officer L Andre Monteil continued to exert influence on the affairs of the group, long after he had turned away from the public glare of the company amid the HMB share purchase scandal.

Gita Paid Herself $30m
Former CL director tells of strange commissions, huge bonuses
STRANGE commissions, exorbitant bonuses and significant weaknesses in internal controls were the order of the day at CL Financial, former group financial director, Michael Carballo, said yesterday.

Carballo: CLF execs in grab for Clico $$

E-mails from whistleblower sparked withdrawals, claims witness

Karen wanted urgent action
AT A MEETING on January 23, 2009 former finance minister Karen Nunez-Tesheira told former CL Financial (CLF) chief financial officer Michael Carballo that she knew about the liquidity troubles at CLF, even before he held his first meeting with her.

Monteil picked for political link
ANDRE MONTEIL was selected to help broker the billion-dollar bailout of CL Financial because of his “political” affiliation.

Duprey’s man in Europe
The name Arnaud de Trabuc, is not generally known in Trinidad and Tobago, although he visited Trinidad in 2003 when CL World Brands acquired the Hine Brands of Cognac and was featured in Newsday in an interview with CL Financial chairman, Lawrence Duprey.

September 20, 2011

Carballo spills beans on Lascelles deal
The Home Mortgage Bank (HMB) was the beneficiary of a $27.2 million fee for providing a guarantee for CL Financial’s purchase of Lascelle de Mercado in 2007.

‘Man in Europe’ a fraudster
FORMER CL World Brands chief executive Arnaud de Trabuc was a convicted fraudster who profited from commissions from all sides of lucrative group deals which placed pressures on Clico and other group subsidiaries, in the view of former CL Financial (CLF) chief financial officer Michael Carballo.

Monteil was told to step down
ANDRE MONTEIL was forced to step down as the Group Financial Director of CL Financial because of the bad publicity generated by his controversial acquisition of Home Mortgage Bank (HMB), his successor Michael Carballo told the Commission of Enquiry into the collapse of CL Financial and the Hindu Credit Union (HCU) yesterday.

Ex-financial director: ‘Persuasive’ Duprey manipulated boards

Karen, Monteil to give evidence
FORMER CL Financial chief financial officer (CFO) Andre Monteil has been summoned to give evidence at the Commission of Inquiry into Clico, inquiry chairman Sir Anthony Colman revealed yesterday.

15 Responses to “Scandalous Wheeling and Dealing at CL Financial”


  • What People do for Money, What people do for money, what people do for money- these are the lines from the once popular hit song.
    When one examine the issue- the question would arrive- what in heavens name one man doing with all this money? Public servants putting their life on the line, officers putting their life on the line -yet their pleas will not be heard.
    What in heavens name is going on in Trinidad? A special unit from the UN have to come down to take care of illegal arms????
    All this cock and bull CRAP- how long ? People do you have to put up with this type of affairs?
    You see my people, there is a higher COURT in the heavens that cannot be bribed !!!! think on this !!! yep that cannot be bribed!!
    Hope them fellas them know that after death is the Judgment? Corrupt hearts cannot and I repeat CANNOT address corruption- Good Lord Help us all we need Help!!!!

  • The taxpayers of T&T are now footing the bill and yet Clico investors had the audacity to chastise the Finance minister for not paying back their money with interest.
    The investors should redirect their anger to where it truly belongs. Every taxpayer in T&T should be given a tax credit for their charitable donations to the bailout of Clico investors.
    I wonder if the fraud investigators and the DPP have the expertise to quickly and efficiently bring charges against these crooks? Or, are these files going to go the way of the files of Calder Hart, Manning, Pena et all. Or, maybe like the Nelson street gang, there is insufficent evidence.

    • Don’t worry T- man , as I and thousands of our paying taxpayers are as outraged at the timidity of your PP government to move beyond old talk ,and initiate real changes , that can either , 1 ,save them some dough ,or 2 ,can bring them some meaningful returns.
      How about going after one of the largest/ most prominent crooks in T&T ,and one who have benefited immensely ,from CLICO big shots. I am talking about national divider in Chief , a la Basdeo Panday, aka de nepotistic ,Couva Bengal Tiger. We want to know if he plans to repay dem law school loans.
      Next on the list , get rid of the last vestiges of imperialism , in the anachronistic Privy Council, and finally recognize locally , and or fully empower the Caribbean Appeal Court, that many idiot politicians , are willing to continually finance , but still prepared to keep T&T , it’s host country out of , due in great measure to their own neo racial stupidity, or rather preference for any white massa, to overseer their lives.
      We know that you socially immoral , self-righteous , upstarts , thinks that the best Afrikan is a dead , or imprisoned one , but pray tell the political hierarchy, to leave our independent minded DPP, and CJ , a lil bit oh chance, before they also run them out of town in favor of another tribal , incompetent crony , or worst yet , Canadian , or English Expert.
      Talk about a phony, almost begging his government to get into bed with more politically unscrupulous Chinese investors, lamenting about fraudulent crooks ,and bandits,all the while demanding ,Canadian Calder Hart neck, but failing to recognize that the man’s wife was a Ponzi scheming Malaysian Chinese, and that she was introduced to peaceful T&T , by Trini businessman Khan , de Central, Chicken farmer , who did not wish to settle for one of his own women ,from within the enclaves. Go figure!

      • Neal, I am with you on this one.
        Included on my list should be Panday, Ish, Steve,and the airport group.
        The Central businessman should have been arrested and given his day in court. Why is the Police accepting his explanation?

        • That’s it folks ,’ I give up,’ and just presented my final vote to ‘de selectors ,’to nominate Cuz T-Man as ‘Kapitan’ of dis team. The man is too good , plain and simple. I bowled him a Yorker, and the brother skillfully shuffled his feet , and dissected the field for a four.
          I instructed one of my spin bowlers, to try an off break, after stacking the field correctly, and again, the nimble foot scoundrel, got on the back-foot , and hit a cheeky single in Larry Gomes fashion, to bring up his 50 th century.
          Ah wonder what our boys Inshan Ali , Raffique Jumadeen, or one time Police ,Ranjie Nannan, would have tried, to get him out, back in the days, when dey controlled our Trini/W.I Cricket fortunes?
          Still have my guards up with him,but,good job T-Man. Equal playing field justice is the way forward for progressives , more concerned about sustainable development in our beautiful country , yes? Get to work , Mr AG Ramy ,and COP Gibbs, as the people have spoken. Go get em all, who in some manner or the other, have attempted to tarnish our country, and worst yet,set bad examples for our impressionable youth /futures leaders.
          It’s certainly a beautiful day , for justice ,across the global village – which T&T remains a part of -= especially ,after the international travesty, I witnessed close up,in Gotham City /Zoo York, as played out by Uncle Obama , on the grand stage in fervent support of Israel,over our Palestinian brothers and sisters , historically trampled rights , as they continually strive to escape the ravages of what Jimmy Carter, maybe rightfully ,referred to, as Apartheid/ Israeli Genocides.

          http://videosift.com/video/Jimmy-Carter-on-Israels-apartheid-policy-the-Israel-Lobby?loadcomm=1

          With election some one year away ,ah wonder ,if someone taught Uncle Obama , how to play cricket as well? Is Her Majesty ,Queen K , taking copious notes folks?
          However I digress, for ‘ Baby America T&T, big Brother America,’ same difference , ennnt?

      • Maybe there is something to be said for favoring the Chinese; bobball and corruption are executable crimes in the Republic.

        http://www.bbc.co.uk/news/10535226

        Even Americans are calling for it:

        http://www.minyanville.com/businessmarkets/articles/china-china-human-rights-china-corruption/8/31/2011/id/36664

        With the so-called Western “free press” why not adapt the laws to include the Chinese punishment methods.

  • Duprey was paid $90 million a year
    LAWRENCE DUPREY was paid $90 million a year from the deposits of policyholders in collapsed insurance company CLICO, attorney Neal Bisnath said yesterday.

    DUPREY’S MONEY BAG
    FORMER CL Financial (CLF) executive chairman Lawrence Duprey was in the habit of bagging a $60 million annual salary, in addition to millions worth of bonuses, fees, commissions, personal loan write-offs and other perks, the group’s former chief financial officer Michael Carballo confirmed yesterday.

    Carballo: Duprey sank big bucks in risky ventures
    Call it a minus or a Midas touch. That’s the effect CL Financial chairman Lawrence Duprey had on his empire.

    Carballo: EFPA interest rates were out of hand
    Interest rates for CLICO’s prime investment product, the Executive Flexible Premium Annuity (EFPA), got “out of hand”, Michael Carballo, the former group financial director of CL Financial, said yesterday.

    ‘Fund deficit was $10.3b’
    THE statutory fund deficit of CLICO was $10.3 billion, Fyard Hosein, attorney for the Ministry of Finance, stated yesterday.

    Shocker after shocker at CLICO enquiry

    Angostura boss gets the axe
    The Angostura board has terminated the services of managing director and chief executive Wayne Yip Choy.

  • A big fish, surely, with smaller sharks following in his wake. Dig deeper.

  • When will white collar crime be given the due consideration it deserves? The verdict is out on whether anyone will be held responsible for this financial scandal. If I am not mistaken, according to the ‘Companies Act 2000’ the Board of Directors are legally liable for the conduct of company business. We the public wait with bated breath for the outcome of the legal matters associated with CL Financial and Clico. Let the chips fall where they fall and those culpable pay for their illegal activities

  • DUPREY GOT $1.1B
    HE MIGHT have earned $90 million in fees in 2007, but in that year former CL Financial executive chairman Lawrence Duprey’s total earnings from the group turned out to be much more than that.

    …Duprey bagged $1.1b before bailout

    Carballo comes under fire
    The credibility of former CL Financial’s finance head Michael Carballo was challenged yesterday as attorneys, questioned his stewardship and the role he played in the failed Lawrence Duprey empire.

    Gita, powerful at CL Financial
    GITA SAKAL, a powerful figure at CL Financial who reportedly signed-off on cheques to pay herself $9 million in 2008, is to testify at the next phase of the Commission of Inquiry into Clico.

    Gita’s e-mails under scrutiny
    GITA SAKAL, one of the controversial characters emerging out of the CL Financial saga, yesterday made a surprise appearance in the public gallery of the Commission of Enquiry into the conglomerate’s collapse.

    Vasant: We need to enforce the laws
    Persons hearing the revelations coming out of the Commission of Enquiry into CLICO must be “horrified” at the nature and scale of what was taking place at CL Financial, Acting Minister of Finance Vasant Bharath said yesterday.

    Monteil paid himself $6.3M
    FORMER CL Financial (CLF) chief financial officer L Andre Monteil signed-off on $6.3 million in cheques to himself, according to a 2008 report of an auditor into the corporate practices at the company.

    PNM: Monteil not treasurer in 2009
    ANDRE MONTEIL was not treasurer of the People’s National Movement (PNM) when the former PNM Government signed a Memorandum of Understanding (MOU) with CL Financial in January, 2009, to deal with financial troubles at Colonial Life Insurance Company (Clico) and other subsidiaries of CL Financial.

    Expert to deal with Clico issue
    CHAIRMAN of the Clico Commission of Inquiry Sir Anthony Colman yesterday indicated that an independent expert will help solve a quandary over the value of Clico Energy.

    Bharath: It’s DPP’s call
    ACTING FINANCE Minister Vasant Bharath yesterday said that it is up to the Director of Public Prosecutions (DPP) Roger Gaspard, not the Government, to determine whether criminal charges can or will be laid against anyone with respect to the collapse of Colonial Life Insurance Company (Clico).

    A frightening abuse of power
    The testimony indicates that when Mr Duprey chose to, he clothed others with the necessary garments of power to do what he wanted done and ‘no damn dog bark.’

  • So Duprey bags the cash and disappears, why isnt the DPP after this guy. He would be big fish and I am sure the DPP can find him. It will be Gaspard moment of glory if he can catch this fish. Over a billion gone his way, now T&T tax payers on the hook all this happen when the PNM was in office. This is an example of how the blimp did not work… hmmm

  • CARBALLO STANDS FIRM
    FORMER CL Financial chief financial officer (CFO) Michael Carballo, the man who gave sworn evidence in relation to former CLF executive chairman Lawrence Duprey and former CL Financial CFO L Andre Monteil, yesterday refused to withdraw allegations of corruption, greed and mismanagement at CL Financial in the face of an angry onslaught of questions from Monteil’s lawyer, senior counsel Martin Daly.

    Daly, Carballo in war of words
    “Would you now shut up?” was the sharp rebuke from Clico inquiry chairman Sir Anthony Colman to Martin Daly, SC, yesterday. Daly, attorney for Andre Monteil, was demanding evidence from chief CL Financial witness Michael Carballo that he had dissented to Monteil’s company acting on behalf of CLF in negotiations with the Government of T&T.

    Daly slams Carballo’s evidence against Duprey, Monteil at CLICO enquiry
    MICHAEL CARBALLO is an unreliable witness who is still feeling “jealous and resentful” since being sidelined in favour of Andre Monteil when the bailout deal of CL Financial was being brokered with Government.

    Lawyer: Ewart alerted Karen
    CENTRAL BANK Governor Ewart Williams was the person who told former finance minister Karen Nunez-Tesheira of the financial difficulties facing insurance company, CLICO, and its parent company CL Financial.

    ‘Sale of CLICO firm in Barbados above board’
    THE sale of CLICO Energy to Barbados firm Proman Holdings was above board, attorney Christopher Hamel-Smith said yesterday.

    ‘We not buying Clico plan’
    CLICO policyholders will use several grounds to challenge Finance Minister Winston Dookeran’s payout plan, vowed David Walker, leader of a claimant group known as the Santa Rosa Team (SRT).

  • Manning for Clico Inquiry
    FORMER Finance Minister Karen Nunez-Tesheira is poised to call former prime minister Patrick Manning to testify on her behalf at the Sir Anthony Colman-chaired Clico Commission of Inquiry. Manning is expected to take the stand at the next phase of hearings beginning November 7 at the Winsure Building in Port-of-Spain.

    ‘Why did state regulators fail to act?’
    With evidence of ‘greed, recklessness, misconduct’ at CL financial

    Clico horror stories
    IT has certainly been a week of horrors for Clico policyholders trying to retrieve their money, having to hear daily revelations at the Commission of Inquiry about the huge sums bandied about by former top executives of the firm.

  • Former Clico director says: Board not told of cash crunch

    Beckles: PNM must clear air on CLICO bail-out
    People’s National Movement (PNM) senator Pennelope Beckles said the PNM needed to “clear up some issues” on the CL Financial bail-out plan. Though Beckles said everyone needed to accept responsibility for the collapse of the massive conglomerate, she said former prime minister Patrick Manning, who has been retained as a witness by former finance minister Karen Nunez-Tesheira when the Commission of Enquiry resumes, would be able to answer some public concerns.

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