That SLB firing again

Wilberne Persaud, Financial Gleaner Columnist

Discussion of the firing of Students' Loan Bureau (SLB) chief executive officer (CEO) struck a chord. Readers' comments all support the minister's action.

There is apparently no sympathy for Lenice Barnett.

Thing is, I was not suggesting the minister's action was unwarranted.

Sniper_rklan in The Gleaner comments facility asked: "Why are some of you PNP political activist still being allowed to write column, if not only to irritate ppl. She got a Benz, parked it; got a Prado which was initially intended for field purposes and parked it also and decided to use her own vehicle, and you're only concern with the handling by the ,inister - got 2 b kidding me."

Honestly, Sniper_rklan, I like your moniker. It matches the way you shoot from the hip with intent.

Lacking, however, is the intense training, honing of skills a sniper must go through, reflected in choice and discernment of target. Remember, you have to avoid friendly fire and killing of innocents. Concerns raised in the column may have political implications but are in no way politically motivated.

That said, let me merely point out that I have no difficulty with Ms Barnett, or anyone else for that matter, being fired for cause. What should never be downplayed in importance, however, is what Sniper calls "handling by the minister". For this is indeed the crux of the matter.

Coupled with questions suggested to me by another reader, I believe the issues raised in the original column take on greater significance. I don't know whether to consider this correspondent a 'whistle-blower' or a 'whistle-shower'. All we get is a showing of the whistle, no blowing and no sound. For the feel of it, though, I quote and list exactly, the questions suggested that we ask, concerning the tenure of former CEO Barnett:

1. How did she get the job?

2. Had Lenice been asked to resign from previous jobs in the financial sector and the reasons?

3. Why was there such a high staff turnover rate at the SLB?

4. If there is a vehicle assigned to her position, why was she being paid a motor-vehicle upkeep for the use of her private motor car?

5. How many managers have left the SLB during the past 10 years and the reasons?

6. A new software system was purchased approximately seven years ago. Was that decision supported by the senior technical persons and did that system meet the requirement specifications of the SLB?

This correspondent claims to have "several additional questions" and to know the "answers to all the questions set out above".

For my part, the only answer I know is that to question four. The audit deals with this specifically. She did have an official vehicle assigned and was using her private vehicle with upkeep. But this was, apparently, approved by her board.

Beyond that, all the above questions seem to point to competence or lack of it, effectiveness and propriety. Results of the audit strongly suggest there might be cause for civil proceedings to recover sums improperly disbursed.

But the questions as to handling by the minister and ministry will not simply go away. If the CEO of an institution that disburses funds - real money - is known to have financial difficulties, the immediate response is to take action to preclude the possibility of, to put it bluntly, fraud. There are myriad mechanisms, which we need not go into, to move money improperly, by a financially pressured CEO.

Private motor-vehicle upkeep is simplest and doesn't look too bad. But, for instance, in the US Savings and Loan debacle, fictitious borrowers were created to channel funds to preferred parties. The schemes are endless.

Irregularities

In this kind of situation, managers, loan officers and, yes, CEOs are immediately sent on leave as these possibilities emerge.

The ministry sat on these findings for two weeks; it condoned irregularities, apparently for years. The board seems to have been asleep, rubber-stamping proposals from the CEO. The CEO, board and chairman approved a highly questionable investment with a company with which the chairman remains firmly connected.

All these things are fundamental breaches of good corporate governance. They can lead to fraud, 'bandooloo', common white-collar crime and theft. We went through enough of this in the financial meltdown, in the alternative investment schemes.

And, if the Gleaner investigative report is correct, a new scam purports to be giving house lots in a residential development scheme that is purely imaginary. What business does the minister, or his ministry, have courting the kinds of disaster these types of conditions tend to precipitate?

This is why the question arises and remains: Did the ministry plan to 'work with' the now-fired CEO to address financial and other difficulties? Was this why two weeks were allowed to elapse before action was taken? Finally, was Barnett abruptly fired because she dared to speak out on the need for and likely increase in charges for student loans? Did she not know that given her peculiar situation, she had to have remained completely under the radar?

The outcome is fine, we say; but the process is flawed. How many more such situations exist? How much will they cost the taxpayer before they are unearthed and fixed?

wilbe65@yahoo.com