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Home Mortgage Amendment Act issue bigger than Section 34
I write in response to the learned Kenneth Lalla’s, SC, letter published in the Trinidad Guardian on January 7, 2013. Mr Lalla asserts that the proclamation of Section 34 of the Administration of Justice (Indictable Offences) Bill has been one of the most controversial pieces of legislation since the Public Order Bill in 1970.
I respectfully beg to differ as the most controversial was the Home Mortgage Amendment Act in 2005, which for strange reasons, did not receive as much condemnation and public outcry as did Section 34.
In 2005 a piece of legislation was passed which, upon reflection after its passage, subsequent amendments and repealing of certain sections through assent and proclamation, would have appeared as the Parliament was being used as a vehicle by the executive, with its majority in the legislative arm, to pass legislation that would appear to bear endless fruit to persons with financial ties to the then ruling regime.
In Parliament on July 15, 2005 the Home Mortgage Amendment Act was passed and assented to on July 29, 2005. The Bill was well-intentioned to have changes made so that the bank would function more smoothly in relation to operating in a contemporary business environment as what obtains in other modern places—just as the indictable proceedings was introduced with the intention of easing the backlog of cases in the courts.
One of those such changes was the repealing of Section 18 of the legislation which would see that there were no restrictions on share ownership or share transfer. The directors may decline to make any allotment of shares to any person without assigning any reason for the decision (probably a good move as is typical with bureaucratic institutions).
The same administration sometime after, passed another amendment to the Home Mortgage Bank Act (Amendment) 2007. It was the first Act of 2007 to be assented to (February 2007). The amendment this time that was adjusted was Section 8. Section 8 sought to give immunity to the directors of Home Mortgage Bank. It stated that the directors shall be exempt from liability for acts done in relation to their job.
Within that same Section 8, Schedule 2 was inserted. It is interesting that the terminology used in relation to the regulatory function and oversight of the Central Bank with regards to the financial activities of the Home Mortgage Bank as stated was not a mandatory one or one that would bear repercussions for non-compliance by the subordinate (Home Mortgage Bank). It stated that the Central Bank “may” supervise the classes of financial activities of the Home Mortgage Bank. It is instructive to note what activities the Central Bank “may” have supervised under the Merchant Bank, the Mortgage Institution, the Trust Company and the Collective Investment Funds.
The preceding schedule became very perturbing on multiple levels. Sometime in April 2007, a member of the board allegedly bought significant shareholdings in the same Home Mortgage Bank, making him in essence in control of it. Undoubtedly, this would raise a barrage of natural and genuine questions about the transparency of the process, conflict of interests, insider trading, fiduciary responsibility of the oversight body—the Central Bank.
There were supposed to be regulations tabled in the house under the former administration to deal with the operations of the Home Mortgage Bank and requirements and regulations/codes of conduct to oversee the directors, shareholders, managers etal.
To bring some semblance to all of this we need to focus on what the columnist suggested in all developments currently and what happened previously under the former administration in the context of roles and responsibilities for politicians and the media.
When the issues arose with Home Mortgage Bank Amendment Acts/repeals and amendments to certain sections, we need to ask if all the parliamentarians would have anticipated what would have happened? Some of the same parliamentarians currently in the opposition were present at that time in governance and some current ministers were in opposition.
The then opposition in the debate of April 2007 made some valid points and concerns about the same Home Mortgage Bank issue during the Equal Opportunity Bill debate.
The question remains as to why there was no massive outcry at what was done by the former regime when highlighted by the UNC-led opposition? Ostensibly, we need to ask what happened to the media personnel also. The question still lurks as if the media personnel we had back then were different to those now? Were those then not as savvy as those currently?
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