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Timeline of the HMB affair

By ANDRE BAGOO Sunday, September 2 2007

click on pic to zoom in
Andre Monteil... at the centre of controversy....
Andre Monteil... at the centre of controversy....

THE ISSUE of PNM treasurer Andre Monteil’s acquisition of Home Mortgage Bank (HMB) continues to generate intense debate and interest in the country, more than four months after it was first raised in Parliament by Opposition MP Ganga Singh.

Singh alleged that Monteil acted improperly by transferring some $110 million worth of HMB shares while he was Chairman of the Home Mortgage Bank. The controversy escalated last week when, in the face of intense criticism from the Opposition, Prime Minister Patrick Manning claimed the matter was being addressed. He later apologised for prematurely announcing that information had been sent to the Director of Public Prosecutions, the Police Commissioner and Integrity Commission.

The following is a timeline on how the issue has been unfolding:



April 25, 1985: The Home Mortgage Bank (HMB) is established by act of Parliament to “support the development of a system of housing finance” and “to develop and maintain a secondary mortgage market in Trinidad and Tobago.”



September 8, 1998: Stone Street Capital Limited is formed with legal documents listing Louis Andre Monteil and his wife Sherlyn Monteil as shareholders and company directors. The registered address of the company is Perseverance Road, Haleland Park, Maraval.



July 29, 2005: Government amends the HMB Act giving the Minister of Finance the power to appoint two directors, taking away restrictions on the ownership and transfer of shares and giving directors the power to dispose of such shares “on such terms and conditions as the directors shall think fit.”



February 6, 2007: Another amendment to the HMB Act is passed, this time making directors of the Bank immune from liability “for acts done in relation to the exercise of their functions.” The amendment does, however, make the Central Bank responsible for supervising certain financial activities of the HMB.



April 25, 2007: COP MP Ganga Singh tells Parliament that HMB Chairman Andre Monteil purchased $110 million in HMB shares, representing a 25 percent stake in the Bank.



May 16, 2007: Monteil resigns as Chairman of the HMB. He also resigns from the Trinidad and Tobago Housing Development Corporation (HDC), Education Facilities Company Limited and the Trinidad and Tobago Mortgage Finance Company Limited.



May 20, 2007: A notice dated May 18, appears in the press. The HMB informs the public that Colonial Life Insurance Company (Trinidad) Limited (CLICO) has transferred its 43.8 percent shareholding of the HMB to Monteil’s Company, Stone Street. Monteil is a CL Financial Director.



May 31, 2007: A Central Bank Report finds the transfer to be legal, but concludes “the transfer of CLICO’s shares to Stone Street Capital goes against the spirit” of a broad-based ownership of the HMB: “There is no basis under the HMB Act to seek a reversal of the transaction. At the same time (the transaction) is inconsistent with the original philosophy which saw the HMB as an institution with a public purpose.”

The Central Bank recommends that “moral suasion” be used to get Monteil to give back the shares, or failing which, that the shares be re-purchased through the National Insurance Board (NIB) at a pre-determined price equal to the original sale.



August 17, 2007: Prime Minister Patrick Manning, tells Parliament that the Central Bank has concluded that the transaction is legal but points out that it was inconsistent with Government’s policy of the widest possible ownership. Manning omits to mention the Central Bank’s recommendations.

The full text of the Central Bank report is sent to MPs days later buried as an appendix in Parliamentary documents.



August 27, 2007: In response to heavy criticism from UNC MP Subhas Panday, Manning claims he told Parliament on August 17 that he referred the matter to certain State agencies, namely the Director of Public Prosecutions, the Commissioner of Police and the Integrity Commission. This triggers an avalanche of outcry from the Opposition benches as MP Singh notes that no such disclosure was ever made.



August 28, 2007: The DPP denies ever receiving any file on the matter. CoP Trevor Paul issues a statement late in the day saying that he has received a report and “an investigation will be initiated.”



August 29, 2007: Succumbing to mounting pressure, Manning apologises to Parliament, saying what he told Parliament about referring the matter to the State agencies was “not correct.” He says Government will move to bring special legislation to force Monteil to re-transfer the shares.



September 1, 2007: But questions linger, such as the issue of an alleged $100 million deposit by HDC when Monteil was its chair, into CLICO, months before the transfer of the HMB shares by CLICO to Stone Street Capital. In an interview with Newsday’s Editor-in-Chief Suzanne Mills, Subhas calls on Manning to explain the transaction.

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