(Trinidad Express) “Serious concerns” were raised about the suitability of Lawrence Duprey and Andre Monteil to manage the affairs of Republic Bank Limited 15 years ago.
And if these “warnings” were heeded the collapse of CL Financial could have been avoided, Afra Raymond president of the Joint Consultative Council (JCC) stated yesterday.
Raymond made the statement yesterday as he testified as a “citizen and a taxpayer” in the Commission of Enquiry into the collapse of CL Financial and the Hindu Credit Union at the Winsure Building, Richmond Street in Port of Spain.
On July 15, 1996 the Frank Barsotti-chaired Republic Bank Limited Board of Directors sent out a letter to shareholders calling on them to reject the takeover of the bank by CL Financial/CLICO.
The main concern raised by the Board for the takeover to be rejected was the fact that the “CLICO/CL Financial group are not fit and proper persons to hold a controlling interest in the bank”.
Queen’s Counsel Peter Carter, counsel to the commission, described the letter from the board as “an attempt to sound some kind of warning”.
“When I look at this page….I do reflect that we were warned about all of this 15 years ago. We would not have been sitting here. But here we are,” Raymond said.
“Persons who become directors and senior managers are required to pass muster as to their personal integrity, probity and past record of commercial dealings. In this regard banks are far more rigidly controlled by law than state agencies and most other types of business. There is one very good reason for this and that is, that the very essence of banking is trust,” Raymond read from the 1996 letter sent by the Barsotti board.
“Shareholders were being offered to sell their shares to CLF because CLF was requiring a majority shareholding. Republic Bank Limited was inviting them (shareholders) to reject that offer on the basis that Republic Bank Limited felt that those controlling CLF were not fit and proper persons to have any management control of Republic Bank,” Carter said.
Republic Bank Limited board also approached the Central Bank for a decision in the takeover matter. The Central Bank did not agree with the Barsotti board.
The board sought judicial review of the Central Bank’s decision but were unsuccessful.
“So this was the Republic Bank in 1996 seeking the legal review of the Central Bank’s decision not to require CLICO/CLF to reduce their shareholding on the basis that those controlling CLICO/CLF are not fit and proper persons to have any control of an institution such as RBL,” Carter said.
Monteil, the former group financial director of CL Financial, was one of several persons described as “not fit and proper” by the Republic bank Limited board.
Duprey, the former chairman of CL Financial, was regarded as unacceptable because of a conflict of interest.