|Senate refuses to release Subhas’s letter |
By Andre Bagoo Sunday, August 10 2014
SUBHAS Ramkhelawan resigned as an Independent Senator on April 10. He resigned amid controversy surrounding a transaction conducted by a senior officer of the State-owned First Citizens Bank (FCB), a transaction done reportedly through a securities firm tied to Ramkhelawan. An investigation by the Securities Exchange Commission (SEC) had opened into the transaction. Ramkhelewan, who also resigned as Stock Exchange chairman, said he did not want both offices to become enmeshed and embroiled in legal matters relating to the SEC probe.
But two months later, Ramkhelawan had something to say. He had something to say about legislation which the Government had brought to make changes to the laws governing the SEC, the agency conducting the probe. Though he was no longer an Independent Senator, Ramkhelawan wrote to the bi-partisan special senate committee which had been appointed to review the legislation, the Securities Bill 2013.
On June 13, at an in-camera meeting of the securities committee at the Arnold Thomasos Room of the Parliament, Wrightson Road, Ramkhelawan’s correspondence was circulated to the committee by its chairman, Minister of Finance and the Economy Larry Howai.
The minutes of that in-camera meeting state, under the heading “OTHER BUSINESS”,
“5.1 The Chairman informed Members that he had received correspondence from former Senator Subhas Ramkhelawan. 5.2 It was agreed that the document would be circulated to Members for consideration and comment.” The minutes of that day’s proceedings are contained in the committee’s 453-page report, later tabled in the Senate. Ramkhelawan’s correspondence is not attached to the report nor are its contents disclosed. Ramkhelawan assured his correspondence was “proper and in order”, but declined to disclose it. He said such a request should be put to the committee.
“You will have to ask the committee for that. I don’t have them with me at this time,” Ramkhelewan said last week. A request made to the Senate by Sunday Newsday for a copy of the letter was last week blanked. Jacquee Phillip-Stoute, the Acting Clerk of the Senate who also served as the securities committee’s assistant secretary, declined the request stating the Senate committee was private.
“Even though the letter would have been mentioned, the committee was a private committee and the letter was not attached to its report so I would not be able to send you a copy of the letter,” Phillip-Stoute said. All attempts to reach the Clerk, Nataki Atiba-Dilchan, were referred to Phillip-Stoute.
There were no invitations to members of the public for written submissions in relation to the Securities Bill 2013 from the date of the committee’s appointment right up to June, according to the Parliament’s official website which regularly publishes such invitations for comments. However, special stakeholders were contacted for submissions throughout the history of the legislation, a practice sometimes adopted. Sunday Newsday last week disclosed changes to legislation which had originally been designed to bolster the powers of the SEC. The changes, in the view of some, watered-down the law. In particular:
... a new provision which could see white-collar criminals pay an “administrative fine” of $500,000 in lieu of criminal prosecution in the courts was introduced. The new scheme will apply to 60 offences. Some of these offences have penalties as high as $2 million and five years jail, penalties offenders would have to otherwise pay if they had been convicted in court;... all the existing criminal offences in relation to securities were shifted from being “indictable” and made “summary” offences, meaning they will be heard by a single magistrate and will not go to the High Court. In contrast, gang offences are indictable;
... a statutory time-limit barring prosecutions after the passing of seven years was introduced. Previously, no time limit had been specified and because the offences were “indictable” they had no time limit for prosecution;
... the provisions of the previous law which called for full disclosure of all documents filed at the Securities and Exchange Commission to members of the public was changed, with stricter disclosure requirements being introduced making it harder for the public to access company filings;
... hearings of allegations of breaches of securities law were explicitly made in camera or secret;
Many of the changes originated at the in-camera meetings of the special committee to which members of the public had no access and through which members of the public, it would appear, cannot scrutinise the materials placed before it. The Committee held eight (8) meetings on the following dates: March 14, March 19, April 25, May 09, May 16, May 23, June 04, and June 13. Every single meeting was in-camera.
Contacted by Sunday Newsday last week, Ramkhelawan said none of the matters or suggestions made in his letter related to any question of fines, penalties or offences. He stated those matters were properly matters for the committee to decide. He assured that his submission was “proper and in order” and that they related to other matters, such as capitalisation requirements and the promotion of foreign issuers. Asked if he felt it was appropriate to make a submission to a committee overhauling the SEC’s powers amid an ongoing SEC investigation relating to him, Ramkhelawan said, “In terms of my making submissions, for me it was making submissions to a committee for the committee’s considerations. I don’t know if the two things are merged together. It is up to the committee to decide whether a submission can add value in terms of coming up with the best legislation in the interest of the nation.”
The former Independent Senator continued, “It was proper and in order for anybody to put information before the committee in terms of the best way to structure the legislation.”
Asked about the contents of his correspondence, Ramkhelawan said, “I was just putting some thoughts together on some areas of the bill that may have needed to have a second look relating to several areas. The first was capital in terms of what should be the minimum levels for certain types of business.”
Ramkhelawan continued, “the second related to the promotion of foreign issuers, dealing with the measures intended to attract foreign issuers to the market.” He said he did not think that his suggestions were accommodated in the final bill and noted the committee was trying to meet a deadline seeking to have the legislation approved before the end of the last session.
The Government and Opposition approved the committee’s changes, though one PNM MP, Colm Imbert, expressed concerned, though he did not request a division.
Asked to comment on the insertion of administrative fines, Ramkhelawan said that his submission did not relate to that as, “that was best handled by the committee”. He noted the new provisions seem to introduce some “levelling” with other pieces of legislation regulating the financial sector, such as banking and financial institution legislation as well as pending insurance legislation.
On the question of summary versus indictable offences, Ramkhelawan stated, “My reading of the switch from summary to indictable was that it was done in order that matters would be dealt with more quickly. My reading was that the matter should be addressed more quickly as if you go the indictable route you have to go through the magistracy to establish whether significant evidence exists, then a trial has to take place at an indictable level.”
The administrative fines and switch from summary to indictable were added after in-camera deliberations of the special select committee of the Senate appointed in March to review the legislation. The members of the committee were: Howai (a former banker); Faris Al Rawi (a lawyer with a corporate practice); Vasant Bharath (a former business executive); Independent Senator Helen Drayton (a former banker); Gerald Hadeed (a former insurance executive); Dr Lester Henry (an economist); Independent Senator Elton Prescott SC (a lawyer with a commercial practice); Anand Ramlogan (a former lawyer with a civil practice); and Kevin Ramnarine (a former energy industry researcher).