CL Financial litigation winds down, Central Bank withdraws lawsuit against former executives

2026-01-26 - 22:33

The Central Bank and Clico’s management have withdrawn a 15-year-old civil lawsuit arising out of the collapse of the former insurance giant, as part of a broader winding-down of major litigation linked to the CL Financial (CLF) collapse. Attorneys for the CBTT and Clico first conveyed the proposal to lawyers for the estate of Clico’s late former chairman, Lawrence Duprey; his company, Dalco Capital Management Ltd; former CLF executive, Andre Monteil; and his company, Stone Street Capital, as well as former CLF corporate secretary, Gita Sakal, last week. At a hearing on January 26, they confirmed the position with the judge presiding over the lawsuit. Justice Robin Mohammed acknowledged the notice of discontinuance filed by Clico and the bank, and will hear the parties on how costs are to be determined and the quantum in March. However, he has signalled that it would be on the prescribed scale and would only go into the assessed scale on very exceptional circumstances. Senior Counsel Ian Benjamin, who led a team for the bank, said he expects discussions between the parties on the outstanding issue, since his client was a public institution. In response, Senior Counsel Justin Phelps, whose submissions the other defendants adopted, urged against a lengthy assessment process. Phelps took issue with statements made by the bank’s attorneys in correspondence to the defendants, reaching the media, which, he said, were “highly prejudicial.” He called for an on-the record statement since, according to him, “The present position of these defendants is that not a single one of the serious pleaded allegations against them has ever gotten anywhere after 15 years.” After hearing both sides, Justice Mohammed said that while the decision on liability was taken out of the court’s hands, the question of costs, on entitlement and quantification, remained with it and notwithstanding the rules on costs in a discontinuance, this could vary based on exceptional circumstances why costs should not follow. [caption id="attachment_1204631" align="alignnone" width="757"] Attorney General John Jeremie -[/caption] The decision to withdraw the lawsuit comes a little over a week after Attorney General John Jeremie, SC, announced in Parliament that the state intended to bring an end to civil litigation connected to the collapse of Clico and CLF. Last week, attorneys for the Central Bank and Clico referred to the findings of the Sir Anthony Colman Commission of Enquiry (CoE) into the failure of the companies, which was laid in Parliament by Jeremie on January 16. “In light of the Colman Commission’s findings and in an effort to save further time and cost on these matters, we have been instructed by our clients to withdraw this claim and propose that the claimants be permitted to do so with each party bearing its own costs,” the letter to the defendants said. The lawsuit, filed in 2011, sought to hold the former executives personally liable for decisions allegedly leading to the collapse of Clico and a multibillion-dollar government bailout and takeover in 2009. The defendants were accused of mismanaging the company by misapplying and misappropriating its income and assets to the detriment of policyholders and investors. Through the claim, the Central Bank and Clico were seeking damages and restitution for losses allegedly incurred during the executives’ tenure. The trial commenced earlier in January, with attorneys for the Central Bank and Clico leading evidence from two witnesses — former Central Bank governor Ewart Williams and the bank’s manager of insurance, Natalie Roopchandsingh. Williams completed his evidence and was cross-examined by all defence teams, while Roopchandsingh was in the midst of cross-examination when an adjournment was sought to consider the case’s future. Although the Colman Commission completed its work and submitted its report in June 2016, it was not made public at the time. It was instead forwarded to the Office of the Director of Public Prosecutions (DPP) to determine whether criminal charges could be pursued. Speaking in Parliament, Jeremie revealed that the state had incurred between $3 billion and $4 billion in legal, accounting and administrative costs, in addition to approximately $28 billion spent to bail out CLF and Clico. He said continuing expensive litigation could no longer be justified. While noting that criminal proceedings fall within the DPP’s remit and that the Minister of Finance exercises oversight over the Central Bank, Jeremie said he had the authority to discontinue civil proceedings to prevent further expenditure of taxpayers’ funds. “I can, however, end civil proceedings. And I propose to do so now, in a cost-effective manner,” Jeremie said. BAT winding-up application Meanwhile, the Central Bank announced on January 23 that it had applied for leave to petition the High Court for the winding up of British American Insurance Company (Trinidad) Ltd (BAT), another former member of the CLF group. In a media release, the Central Bank said the application became necessary due to BAT’s continued insolvency. While the company has sufficient assets set aside to meet the obligations of traditional policyholders—including holders of ordinary and industrial life insurance policies, accident and sickness insurance policies, disability income policies and annuities—it does not have the assets required to repay its other debts. “The Insurance Act 2018 requires that the Central Bank take necessary action when an insurance company continues to be insolvent,” the Bank said, adding that BAT was unable to improve its financial position despite its best efforts. The regulator assured that policyholders would continue to be serviced as usual during the winding-up process. “Your policies remain in effect, and you will continue to receive all your contractually due payments and benefits, including pensions,” the Central Bank said, noting that this is possible because the Government injected sufficient assets to protect policyholders and the traditional insurance portfolio. [caption id="attachment_1204630" align="alignnone" width="333"] Andre Monteil, former Stone Street Capital executive. -[/caption] The Central Bank said it could not say how long the winding-up process would take, as the matter is still at the stage of an application for leave to be determined by the court. BAT collapsed in 2009 alongside Clico, Clico Investment Bank and Caribbean Money Market Brokers, all part of the CLF conglomerate. Government settles Proman-CLF Privy Council dispute In a separate statement on January 19, the Office of the Attorney General announced a settlement of the Privy Council appeal involving Proman Holdings (Barbados) Ltd and CLF, describing the matter as one that posed a serious threat to Trinidad and Tobago’s economic well-being. According to the release, upon assuming office, the Government inherited several complex legal disputes from the previous administration, including the high-profile Privy Council appeal arising out of a controversial share transfer involving Clico Energy Company Ltd, now known as Process Energy (Trinidad) Company Ltd (PETL). The dispute centred on a purchase and sale agreement dated February 3, 2009, under which CLF, purportedly acting through Duprey, its then chairman, sought to transfer a 51 per cent shareholding in CLICO Energy to Proman for US$46.5 million. The transaction was challenged in the High Court, with Justice Devindra Rampersad ruling in September 2021 that the transfer was invalid. Justice Rampersad ordered Proman to return the shares to CLF and to account for dividends and distributions received, which were ultimately valued at more than US$185.9 million, exclusive of interest. Proman appealed, but the ruling was upheld by the Court of Appeal, which described the matter as “high stakes, full-blown, adversarial litigation involving well-renowned Titans of Trade and Industry.” Proman then pursued a final appeal to the Judicial Committee of the Privy Council. The Attorney General’s Office said that immediately upon taking office, the Government—then the majority shareholder and largest creditor of CLF—sought advice from senior King’s Counsel in London on the prospects of success before the Privy Council. After receiving that advice, the Government opted to continue settlement negotiations that had been initiated under the former administration. The statement said careful consideration was given to the litigation risks involved, including the “very real possibility” that aspects of the Court of Appeal’s ruling could be overturned. Ultimately, CLF, with the agreement of its liquidator and the sanction of the court, agreed to sell the disputed shares to Proman as part of a compromise to bring the Privy Council proceedings to an end. The Attorney General’s Office said the settlement allowed the state to recover significant funds while avoiding the substantial financial and legal risks of continued litigation. “This decision balanced the national interest, the prospects of success and the need to protect public finances,” the release stated, adding that the settlement brought finality to one of the most significant and long-standing disputes arising out of the collapse of the CLF group. Trincity Mall sale terminated In late 2025, the government also moved to halt the sale of Trincity Mall, one of the most valuable commercial properties in the CLF portfolio and a key asset of Home Construction Ltd (HCL), a subsidiary. The government agreed to accept the consortium of buyers’ proposal for the return of their deposit and related costs. The consortium of buyers behind the $505 million purchase of Trincity Mall expressed its intention to pull out of the deal due to the criminal investigation into the sale of CLF assets and the High Court injunction that halted the transaction. The injunction halted the pending sale just hours before it was due to be finalised, amid mounting scrutiny over the management of CLF's liquidation. The sale of the mall had received the go-ahead in April by liquidators Grant Thornton to the consortium comprising businessmen John Aboud and Anthony Rahael, along with contractors Kallco Ltd and Fides Ltd. Attorneys for the consortium had noted that the buyers had been “ready and willing” to complete the transaction but could no longer proceed due to “serious concerns about the legality and validity of the sale.” “We further note the recent reports on commentary by the main creditor of CLF (the government) regarding the sale of assets by the liquidator, as well as the report that the Commissioner of Police has directed the Anti-Corruption Investigation Bureau (ACIB) to launch a criminal probe into the sale of key CLF assets,” a letter to the liquidators stated. The letter said those developments “have a considerable negative impact, both on our client and on the transaction,” and raised questions about whether the vendor could “provide clear title or meet the conditions precedent” of the sale agreement. It also added that the uncertainty surrounding the sale had already caused reputational damage, operational disruptions, and financial exposure for the consortium and mall tenants. “At minimum, the issues that have been raised expose our client and the target to considerable (unwarranted) reputational risk,” the letter continued. “The injunction and/or the probes that are apparently to be conducted, to the extent that they impact the vendor's ability to complete the proposed sale, will delay the closing of the transaction.” It further noted that the mounting legal and political fallout constitutes a “material adverse change” under the sale agreement, entitling the purchasers to withdraw from the deal. She proposed an amicable termination under Clause 11.1(v) of the contract and requested a full refund of the deposit, along with reimbursement of costs totalling $4.75 million, inclusive of accrued interest. “It is in the best interests of all parties to resolve this matter amicably.” That matter is still being finalised.