Managing Monteil

PNM party treasurer and financier and CLICO heavyweight Andre Monteil has clearly been earmarked as its sacrificial lamb on the altar of corruption for the upcoming general elections campaign. Caught with its pants down, after it booted the Panday administration out of office on the issue of corruption, the government is having the moral and spiritual rug yanked out from beneath its political feet on the eve of the election.

The only way to deal with such a situation is to show that the PNM is serious about corruption as illustrated by the manner in which it deals with such allegations. Unlike Panday, who ignored cries from his own supporters about his notorious 10% government minister in his cabinet by calling for evidence to be taken to the police, Manning wants to demonstrate that he will treat such matters at arms length. He will expose it and have it investigated. No cover up.

This might be good damage control political strategy but the fact remains Manning has only reacted when the petticoat of his government started showing. When, for example, the PM first dealt with this matter in Parliament on August 17 he defended the narrow legality of the transaction by stressing that the Central Bank investigation advised that there was no basis under the Home Mortgage Bank Act “to seek a reversal of the transaction.” He made no mention of the fact that the report viewed the entire transaction negatively and recommended the use of “moral suasion” to convince Monteil’s company, Stone Street Capital to divest its shares.

The Central Bank report went so far as to suggest that NIB be used as the vehicle for the re-purchase of the shares and Monteil be paid back the $110 million for the shares plus interest and expenses incurred.

One can understand why Subash says “the Central Bank asked for moral suasion they knew he was treasurer of the PNM. They were saying, ‘Hear what, he’s the treasurer of your party, talk to him, nah. Reason with him nice, nah. Tell him take some, not all (sell to NIB).”

It is inconceivable that a transaction of such importance and magnitude could have taken place without the knowledge, consent and tacit permission of senior government officials. For starters, what about the directors drawing fat salaries who serve on the Boards of the Housing Development Corporation and the Home Mortgage bank? Are we really expected to be so naive as to believe that a hundred million-dollar transaction involving the sale of shares in a government-controlled financial institution takes place and no one in the government knew about it? Were these directors asleep when all this was taking place? Did they vote in favour of the sale of the shares to Monteil?

What about the loquacious Housing Minister Keith Rowley himself who stridently attempted to defend the transaction that occurred under his nose and watch? Manning made him look stupid when he condemned the deal and apologized for ostensible misleading the House.

There are many unanswered questions. According to Manning, “a question also arose with respect to the financing of the transaction under which HDC was said to have made a deposit of $100 million in CLICO Investment Bank. Mr Andre Monteil was at the time chairman of both HDC and CLICO’s bank.” Monteil’s resignation from the HDC Board is no plaster for this cut which raises the issue of conflict of interest.  

One supporter described Monteil as ‘the heart and lungs of the PNM’.  In Panday appeal, Justice Archie outlined his role by saying “The Attorney General’s later account of his investigation is that, on 25th April 2006, the day after judgment was delivered, he telephoned Mr Monteil, who was his personal friend…He (Monteil) told CLICO to ‘clean up their mess’ and says he used the word ‘mess’ because ‘although I could not prove anything I was angry nevertheless’.

The timing of the AG’s intervention is also the subject of a discrepancy that may be of significance to the fair-minded observer. According to Mr Monteil, his first conversation with the AG concerning the matter was sometime in late March or early April at a time when the judgment was still outstanding. We are not required at this stage to resolve that discrepancy. What we are required to consider is what impression the totality of the available evidence would have on a fair-minded observer”.

I wonder what impression this purchase of shares by the PNM’s treasurer would have on the fair-minded observer as they think which party to vote for?

 By Anand Ramlogan 2007-09-01