Attorney General says CLICO operated Ponzi scheme

Trinidad and Tobago Attorney General Anand Ramlogan said Wednesday that cash-strapped Colonial Life Insurance Company (Trinidad) Limited (CLICO) had been operating an 'elaborate Ponzi scheme' as the authorities move to make the directors of the company liable for its failure.

Ramlogan, speaking on a television programme in Port-of-Spain, said that CLICO, which has received billions of dollars from the Trinidad and Tobago government in bailout funds since it problems became public in 2009, said documents secured had indicated an alleged internal and, indeed, an external Ponzi scheme.

"It's an elaborate Ponzi scheme at that. It is adequately set out in over 200 pages of the claim document and the idea is, internally, depositors' money were improperly diverted or misappropriated in order to fund a CIB (CLICO Investment Bank) or CLF (CL Financial) or other groups, often in return for worthless or wholly inadequate considerations or security".

The Central Bank of Trinidad and Tobago (CBTT) and Colonial Life Insurance Company (Trinidad) Limited (CLICO) Tuesday filed civil proceedings against the former chairman and owner of CLICO, whose collapse has sent economic shock waves throughout the Caribbean.

A statement from the CBTT said that the civil proceedings have been filed against Lawrence Duprey, former director Andre Monteil, as well as CL Financial Limited, Dalco Capital Manage-ment Limited and Stone Street Capital Limited arising from the failure of CLICO. (See related story on Page 12.)

CBTT said that it acted under emergency powers provided for under Section 44D of the Central Bank Act that allowed CBTT to assume control of CLICO.

- CMC