Central Bank sues former CLICO boss
Two years after the collapse of parent company, CL Financial, the Central Bank and CLICO have filed civil proceedings against Lawrence Duprey and others.
PORT OF SPAIN, Trinidad, Wednesday June 8, 2011 – The Central Bank of Trinidad and Tobago (CBTT) and CLICO have filed a lawsuit against former head of the CL Financial conglomerate Lawrence Duprey, another ex top official, and other companies over the insurance company’s collapse.
The action, which comes more than two years after CL Financial got into financial difficulties, also names former chairman of CLICO Investment Bank (CIB) Andre Monteil, CL Financial, Dalco Capital Management Limited and Stone Street Capital Limited.
The Central Bank, which said it exercised its emergency powers to take the action following forensic investigations into the affairs of CLICO, said the claims in the suit include “allegations of mismanagement of CLICO and misapplication and misappropriation of its income and assets to the detriment of its policyholders and mutual fund investors”.
“CBTT and CLICO are seeking damages, equitable compensation and declarations related to certain agreements and property of CLICO,” it said.
The Statement of Case alleges breach of statutory and common law duties and related accessory liabilities on the part of the Defendants and highlights “certain egregious transactions” involving the use of CLICO’s assets and income to its detriment.
These include transactions related to shares in Republic Bank Limited; drinks transactions including Lascelles de Mercado; energy transactions including the sale of CLICO’s stake in CLICO Energy Ltd; Florida property transactions; and the sale of seven million Home Mortgage Bank (HMB) shares.
The Central Bank said the pleadings highlight “the subordination of the interests of CLICO, its policyholders and mutual fund unit investors to the private interests of Mr. Duprey and Mr. Monteil and their companies; the lack of proper governance and serial mismanagement; and improper dealing with CLICO’s assets and the funds of policyholders and mutual fund unit holders.”
It added that “forensic work is continuing and may result in the expansion of this claim and/or further action”.
In April last year, the CBTT-appointed Manager of CIB also commenced civil proceedings against Monteil, former president and chief executive officer of CIB Richard Trotman, First Capital Limited and Stone Street Limited arising from the failure of the Investment Bank.
Duprey resigned as chairman of CL Financial and CLICO in 2009 after the group approached the then People’s National Movement (PNM) government for a multi-billion-dollar bailout. That financial assistance was provided and the government now has control of CLICO and some arms of CL Financial.
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