July 24, 2015
Her Majesty’s Governor
Ms. Christina Scott
Government House
Old Ta
Anguilla AI-2640
Your Excellency:
We write to you primarily with respect to a commitment that you made to the Anguillian public via a local media house to make available to the people of Anguilla the contents of the report of the investigation into the cause of the banking crisis in the two indigenous banks in Anguilla.
We hope and expect that Your Excellency has been paying sufficient and keen attention to the reports in our media houses of the various expressions of concern emanating from the community over the deafening silence of the Chief Minister, who is the Minister of Finance, Mr. Victor Banks, as it pertains to the two (2) severely distressed local banks- the Caribbean Commercial Bank (CCB) and the National Bank of Anguilla (NBA).
We note with alarm that on the two recent occasions that the Chief Minister addressed the public on the banking issue, he failed to address the state and health of these banks. More importantly, however, he failed to share with the public the banking report of the Eastern Caribbean Central Bank (ECCB), the governing authority; even though the media has reported that the said report has been transmitted to the Government of Anguilla.
As Your Excellency is aware, the ECCB had committed to preparing a thorough report which would address in detail the circumstances which led to the local banks’ severely distressed state, that warranted the Central Bank’s assuming exclusive control of them on 13 August 2013, with the full support of the Foreign and Commonwealth Office, the International Monetary Fund and the World Bank. As Your Excellency is equally aware, one major reason for the Central Bank’s intervention was the stark realization that the situation could pose a distinct liability to the regional banking system, and adversely affect the other Caribbean islands who are members of the Eastern Caribbean Currency Union. We cannot help but remind your Excellency that the report was also promised to be made public by the ECCB through its press conference in the Executive Council Chamber on the day the ECCB took the indigenous banks into conservatorship, as Mr. Banks himself acknowledged in his address on the 17th of July.
Surely, Your Excellency must be aware that some of the much condemned actions which eroded the stability ofNBA and CCB were related to the acts of gross conflict of interest of directors and other persons/firms who were supposed – indeed expected – to act as befitting their position of trust in the local banks or in the society. Shareholders, depositors and the public of Anguilla in general were deeply concerned about these flagrant breaches of trust, and are therefore discomforted that up to this point the Chief Minister has not disclosed the contents of the banking report to the public, has not stated when it would be available for public consumption, and seems to have every intention of keeping it a tightly guarded secret. Interestingly, Mr. Banks stated today in accepting the chairmanship of the Monetary Council of the ECCB that the local banks were built by almost the whole of Anguillian society, yet he disrespects us by not making the report public.
There is a real and legitimate fear that the Chief Minister will prevent public disclosure of this report and stifle public discussion of its contents for the following reasons:
1. The Chief Minister was the Minister of Finance in a previous AUF administration who ignored the urgings and directives of the ECCB to take specific actions, including the removal of certain directors from the administration of NBA when certain grave anomalies had become apparent.
2. The Chief Minister’s brother was the Chief Executive Officer of NBA when the urgings mentioned in number 1 above were ignored.
3. Mr Bank’s colleague, the then Chief Minister, was also the chairman of CCB – an anomaly that was nothing short of an unabashed conflict of interest: The Chief Minister was also holding the private office of chairman of a local bank. (The records will show that that grave anomaly was brought to the attention of a former governor of Anguilla in writing, and that it was also brought to his attention in numerous forums, and yet no steps were taken by the British Government through its agency, the Foreign and Commonwealth Office, to redress the situation, not withstanding Her Majesty’s Government’s constitutional responsibility for Finance. It must also be pointed out that in the Executive Council held on August 13, 2013, the Governor of the ECCB also noted that the Central Bank, too, had written to the AUF leadership regarding this blatant example of conflict of interest, but that that warning, too, had been ignored.
4. The awkward position in which the Bank’s government now finds itself, having to explain the contradiction between the date of the release of the banking report and the deliberate lies told by Mr Curtis Richardson, one of the AUF platform speakers in the last general election campaign who is now a Minister in the Banks Government. An excerpt from one of Mr Richardson’s speeches which he made at a public meeting on February 5, 2015, and which can be accessed at https://www.voutube.com/watch?v=A \ViwBs2 la9A reads:
This AUM government, signed for the ECCE to take over our banks …[You heard about] the report that they talk about for months on their famous fabulous radio station. The report that they expected to prove their points of corruption and criminality have been written. But the reason why you are not hearing about the reports anymore is because the report page by page have slapped them in their faces slapped them because it has come back marked, there is nothing untoward that went on!
What is even more startling and incredulous is a recording of the reflections on the banking situation of Mr. Osbourne Fleming, the ‘then ChiefMinister’ referred to in number 3 above. The recording can be accessed at https://www.youtube.com/watch?v=x82mWnAim’I1, which I have transcribed for ease of reference.
“I said to myself, the bank aint coming. I had never call them but they came. But now the rumour around the table, the problem is me. So somebody say ok, . .for Caribbean Commercial Bank .. .for National Bank. .. hahahaha …. you know what I mean but the problem is that all …. it’s a lot. I can’t even begin. I know one thing I can tell you, that I ‘m a happy man. That’s all I can say. You don ‘t have to worry about me at all.
I say when I leave government I don ‘t have to look back, I don ‘t have to look back.
I was the only director on the Board that didn ‘t have no loans. I never believed in it.
I’ve always said, that if you’re a director on a board, you should stand tall, always said. Now I aint saying they can ‘t have a few dollars; but not MILLIONS!
The problem started at National. That’s where it started first, you understand?
That’s where it started. No sympathy from me at all- the query- you know, when the bank was looking for a bit of land to buy, all I said to them was that I have an acre of land down west, I want a million dollars for it.. ’cause in those days, that was the going price for land. So Bryan had a piece of land down west. And, and John has a piece of land there selling … had piece of land down there selling for the same price, everybody asking about the same price but the reason why they took my own is because there was a road to the east and a road to the front. It was Ruan (inaudible) who did the negotiations for the bank.
He was the one that finalized the deal with me. Cause I … .. completely . .. (inaudible)
Lemme tell you something; it ‘s a sad day for Anguilla and it’s a good day for Anguilla.
I was telling somebody this morning, the Central Bank themselves has to start … , they aint realize the problems that they have. They don’t have the first clue of the problems they have. These banks are in trouble. I can tell you that.
Wa gon happen is that a number of businesses are going to go under because a lot of them are operating on overdrafts and the bank is not going to allow that. (inaudible) But I think the best thing at this time, is for, if the banks were continued to operate as they were, I see a day coming when depositors would have go in and asked for their money, and the banks wouldn’t have it- and the banks would have collapsed. So what has happened, is good. Ah telling ya.
(inaudible) Leslie moved a motion for my dismissal as Chairman, and Clement second it. And then ya had … on the board like ammm Michelle, Carmen, Fost .. ammmm Proctor, Watson, even if. … on the board … a coup … (inaudible) when certain things; my name went around. A fella, I did not agree to a loan the other day; Iemme tell ya something and it aint no one instance, this fella came to the bank to refinance a loan right. I tell the fellas, let him stay at National. Don’t take him on.
I tell um so … (inaudible) … they come when they ‘re in trouble- money so hard to pay it back. He meet me and said to me, thanks for supporting the loan. I said no, you didn ‘t hear that. I didn ‘t support the loan.. (inaudible) Six months after, less than six months after, he couldn ‘t pay -1 told them! I said you all don’t understand!
They don ‘t understand. I in this thing long. I know money, I KNOW MONEY, I know money just … . Iemme tell ya something, money just don ‘t come ya know, ya gotta work for it. It don ‘t come. OHH, I remember when I use to work with Mr. Gumbs he would say Osbourne, don’t worry, money will come. (I said) Mr. Gumbs NOO, money don’t come, ya gotta work for it hahahahahaahaha.”
We know that the outgoing Chief Minister, Mr. Hubert Hughes, had made arrangements with the British Government to conduct a forensic audit which the Department for International Development had agreed to finance, that the ECCB had promised not to stand in the way of that audit, but rather to facilitate it, and that the exercise had begun before the end of the second week in April this year. It was also agreed that the report would be made available to the Anguillian public.
We fear that Mr Banks will seek to hide the contents of this report from public knowledge, apparently for the same reasons that he is not disclosing the contents of the banking report. In his last address on the banking crisis he spoke about the “sensitivity” of the banking report as he sought to hide behind the untenable argument of confidentiality of its contents as a reason for not giving the public access to the information in the report. Who does not know the difference between personal banking information, and a report of an investigation into a bank that conducted its financial operations openly, with money invested and/or deposited by members of the public, and a forensic study that seeks to find out who is accountable for the monetary crisis in those banks? No one wants or expects a disclosure of people’s personal banking information but they certainly want – and have a right – to know about the goings-on at the local banks.
We are very keen to know what steps will be taken by your high office to prevent what appears to be a massive cover-up of corruption that stinks; to bring to justice all persons who engaged in conflicts of interest in the indigenous banks; and to seek redress in our Courts of Law in the event that the forensic audit incriminates any of the directors of the two indigenous banks. May we remind you that the Governor is responsible for good governance in Anguilla.
However, by far the greatest concern is that the Chief Minister also stated in his last address that he would be tabling legislation relating to a bank resolution that is “fit for the purpose!” Fit for whose purpose; Anguilla’s or those persons guilty of engaging in conflicts of interest and whose greed may implicate them in the dismal monetary situation in the local banks? If the findings of the banking report and more likely the forensic audit are kept from the people of Anguilla under the pretext of confidentiality, how are we to know whose interests Mr Banks’ “resolution” is serving?
It is unacceptable, in light of all that has been said above, that the Chief Minister should hold this country hostage in this way. Shareholders, depositors, and in fact the entire country are entitled to view and digest the full, unsanitized contents of the banking report from ECCB and the forensic audit by the British Government, given the scope and magnitude of the situation at the local banks and the crucial impact they have on the economy of the island.
It is specifically because of the apparent reluctance of the Chief Minister to share with the country the contents of the banking report and, we can only assume the forensic audit as well; of what we can construe only as an attempt to cover up corruption; and because of your constitutional responsibility for good governance in Anguilla that we call on you, Your Excellency, to honour the commitment that you made to the people of this country in the media, when you assured its citizens that you would share with them the full contents of the banking report. When asked by Mr. Keithstone Greaves on his programme “Talk Anguilla’ whether the report would be made available to the public, your firm and unequivocal position was that you would do so. We assumed at the time that your promise was made in the interest of transparency, good governance and the edification of our people about what occasioned the grave situation in the two indigenous banks which are responsible for over 75% of Anguilla’s banking system.
Given the urgency and pressing concern this matter holds to the people of Anguilla, we look forward to your prompt and substantive response to our communication, the subject of which can be summed up as two issues: (1) a request for your disclosure of the contents of the banking report and the forensic audit, and (2) what steps your Office intends to take with respect to prosecuting those persons who may be found to have been criminally or civilly involved in the deep breaches of trust described above.
Sincerely,
Ellis L. Webster, M.D.
Leader, Anguilla United Movement
cc. FCO, UKG, AG Chambers, Members ECCB Monetary Council, the Media.
(Published without editing by The Anguillian newspaper.)
