Financial Intelligence Unit in T&T urged to intervene in questionable shares purchase
(Trinidad Express) The Financial intelligence Unit (FIU) has been “conspicuously silent” on the issue surrounding the questionable purchase of over 600,000 FCB shares from the group’s former chief risk officer H Philip Rahaman during the bank’s Initial Public Offering (IPO), Colm Imbert said.
Imbert said the situation has also brought to light the issue that this country’s chairman of the Trinidad and Tobago Stock Exchange (TTSE) should not be someone who is politically exposed.
He made the statements during a news conference at the Office of the Opposition Leader, Charles Street, Port of Spain, yesterday.
Rahaman was fired following an internal audit by the bank on his purchase of 659,588 bank shares during its IPO, and the subsequent sale of 634,588 of those shares four months later.
It was said Rahaman was dismissed because the bank lost confidence in his ability to carry out his duties.
Imbert yesterday took to task those claiming Rahaman had done nothing wrong during the transaction.
Imbert said according to both Section 137 and 138 of the Securities Act Rahaman would be liable to a $500,000 fine and two years in prison under each section if he did not report his purchase to the Securities and Exchange Commission within five business days.
Imbert said it appears from reports due diligence was not followed in the purchase.
“I am very intrigued at the statements being made ‘no laws being broken’,” Imbert said.
“I am not a policeman, I am not even a lawyer but the fact of the matter is the Securities Act says if you are an officer of a bank and you buy shares in the bank you have to report it to the Securities Exchange Commission in five days , if you are doing the transaction for someone else you have to report that too,” he said.
“It says the bank has to do due diligence on you to find out where you got the money from you have to satisfy the bank. The broker has to do due diligence on you to satisfy themselves that the money is from a clean source on the face of it it does not appear any of these things were done,” Imbert said.
Independent Senator Subhas Ramkhelawan, the managing director of Bourse Securities and chairman of the TTSE has come under fire as a result of the transaction.
Imbert yesterday said he could not comment on Ramkhelawan’s involvement in the issue but said the controversy has thrown a spot on the criteria for TTSE head.
“What it has highlighted is that it is not a good idea to have a politically exposed person as a director of the stock exchange, I think that was an oversight. That was an error,” Imbert said.
“Because you see, Mr Ramkhelawan, is now having to defend himself against allegations of conflict of interest and allegations of a far more serious nature. He should not be in that position, the chairman of the stock exchange should not be in a position where his brokerage house could be investigated by the stock exchange, what is he going to do in that kind of situation. I mean it is a very embarrassing and unfortunate situation and in retrospect the Government should not have put a politically exposed person as chairman of the stock exchange,” Imbert said.
Imbert called for a proper investigation in the matter to ensure confidence in the bank is regained.