Dear Dr Keith Christopher Rowley, Happy Independence to you and all of T&T, I trust this letter finds you in good health.
With just eight days to go before the next general election, it has now become pellucidly clear to us, the over 15,000 Clico "assenting" policyholders and our families, that the People's Partnership Government has absolutely no intention of paying us our just and rightful due, contrary to their public pronouncements on March 27, that Clico is solvent, its statutory fund is now fully funded and all assenting policyholders would be made whole.
The Clico Policyholders Group held our mass policyholders' meeting two Sundays ago to discuss the way forward. We are pleased to inform you that the meeting was a success as evidenced by not only the more than 200 policyholders who were in attendance but more importantly based on the substantive resolution that was unanimous passed as follows:
�2 Be it resolved that ALL 'assenting' Clico Policyholders withhold our support for the PP and its affiliates with immediate effect, until such time that we are paid the balance due on our contractual entitlements from the Clico Statutory Fund
�2 Be it further resolved that the PP be given until August 21, to respond to the said resolution failing which, the policyholders group would immediately approach the "government in waiting" (ie the PNM) for them to make a clear and unequivocal statement on whether or not they will ensure that all "assenting" policyholders are paid the balance due on our contractual entitlements from the Clico Statutory Fund, should the PNM be successful at the polls on September 7.
Unfortunately, August 21 has come and gone, however, to date we have had absolutely no satisfactory response from the PP except for an ill-advised, off-the-cuff remark by Prime Minister Kamla Persad-Bissessar that withholding our support for the PP "may be seen as blackmail..." Thereby, confirming our worst fears that the PP is not serious about their commitment to pay policyholders our just due and bringing back memories of two now infamous statements "a promise is a comfort to a fool" and "take it or leave it."
In the circumstances, we wish to request an urgent meeting with your good self or your representative to address the latter part of the resolution.
In the interim, we are confident that you will not disappoint us like others have done and remain mindful of the fact that the decision to intervene (and rightfully so) into the affairs of Clico in 2009 was taken by the PNM government in response to a request by the CL Financial Group for substantial financial support for what was initially diagnosed as a temporary liquidity problem, but in fact turned out to be a structural illiquidity and solvency problem.
You would recall that given the size and economic diversity of the group's operations, it was the PNM government and Central Bank that correctly deemed the intervention necessary in order to avert a national crisis by achieving certain key objectives: (1) Protect the country's economic and financial system from risk and restore confidence. (2) Protect resident policyholders and depositors in the insurance and financial services companies of the group. (3) Continue Clico as going concerns as the means of restoring confidence and maintaining system stability and (4) Recover public funds from CLF.
It is noteworthy that Clico and the other troubled financial services entities of the group combined accounted for circa $46 billion of funds under management and represented approx 30 per cent of GDP. Moreover, CLF controlled total assets of approx $100 billion and given the breath and depth of its economic involvement, the PNM government's stated concern, at the time, was that a potential failure of Clico and the other financial services entities, could cause the entire group to rapidly become insolvent and so affect the financial sector as well as the entire economy, particularly at a time when the international economy was already in deep recession.
It is also noteworthy that in relation to the protection of "third-party" policyholders and depositors, the PNM government made it very clear that those (ie senior management etc) who would have been party to the decision-making that led to the collapse or may have benefitted from same did not qualify for the protection/support which the Government would have provided. Clearly, such international best practice seems to have been totally disregarded by those in authority as evidenced by the recent multi-million dollar payout to former Clico directors. But enough said. We thank you in anticipation and look forward to your timely response.
Peter Permell
Chairman, Clico Policyholders Group