Senator Edison Key Resigns From the Progressive Liberal Party (PLP)

"I'm just looking for a bright future," says Edison Key

War In PLP - Key Leaves Party

By Candia Dames

candiadames@hotmail.com

Nassau, The Bahamas

24/02/2004

Claiming that forces within the party have launched an all out war to decapitate him politically, former Senator Edison Key has resigned from the PLP.

"I see this situation getting worse each day and I figured maybe this is the time to just give it all [up] if that's what they want," Mr. Key said in an exclusive interview with the Bahama Journal Monday.  "I was in my bed and this came to me that maybe I should just relinquish my ties with the PLP for the time being."

He added, "Let them do what they want to do, maybe they're better off without me."

Mr. Key's change of heart comes exactly one week after the Journal revealed in an exclusive report that he had resigned from the upper chamber on January 10.

Last Monday, when asked by the Journal if he intended to resign from the party, Mr. Key said, "I've been a part of the PLP from 1970.  I've been through all the struggles and trials and tribulations.  I ran here in Abaco when you [would have been considered] an outcast to even identify with the PLP, especially a white man in an all white area."

He said then that he would not leave the party.

But he said Monday that things have changed since last week and that some members of the party have lined up to throw daggers at him.

Mr. Key said in a letter to PLP National Chairman Raynard Rigby that, "This decision has come about due to the unfortunate chain of events that have occurred over the past 20 months culminating in my resignation as Senator in the new Progressive Liberal Party Government, effective January 10, 2004.  Kindly convey my very best wishes to all Stalwart Councilors when next council convenes."

Mr. Rigby said in a release to the press last night that, "As is the custom, the letter will be forwarded to the National General Council of the party and to the leadership council."

He added, "It is with regret that we have received Senator Key's resignation.  It is most unfortunate.  The party will continue its work in Abaco and the rest of The Bahamas."

Mr. Key reiterated to the Journal Monday, "It creates deep pain, it goes right to the soul and that's what I've felt for the last year and ten months under this administration.  I really feel sorry for them because it seems that they have no direction and no director.

"Maybe that's saying it pretty harsh, but I think it's time for the people of The Bahamas to wake up and get a government that will give The Bahamas back to the people.  It's now become a government that's become almost a dictatorial system and it's time for a change"

But he insisted that now was not the time to reveal the contents of his letter of resignation from the Senate, a copy of which he said has been sent to Senate President Sharon Wilson.

Last Thursday, Mr. Key told the Journal that his meeting with the prime minister "went well" and that he had a "frank" discussion with the nation's leader.

He said, though, that he feels that he no longer belongs as a member of the party so he has opted to pull out.  But he said he was not prepared to align himself with any opposition party because the Free National Movement, in particular, is also facing a leadership crisis.

"I'm just looking for a bright future," said Mr. Key, who was in Nassau on Monday.

When asked whether he thought there was a viable alternative to the PLP, the former Senator said, "If there were a strong opposition, the PLP [would be] in trouble.  But even the opposition needs [to get] it together.

"You see, I know how to fight the opposition, but I never had any ammunition to fight the PLP.  I have no bullets that can penetrate the PLP.  It's like shooting one of your own family.  You don't do that.  I'm talking in a political sense now."

The Journal also asked Mr. Key what it will take for him to rejoin the PLP. 

He said, "Hope and help - and help and hope that really means it, [a leader who] says what [he] means and means what [he] says.

"Good leadership."

Asked if he may consider joining an opposition party in the future?  He said, "You never know.  The king dies, a new king comes up."

Mr. Key also said he was hurt by a column that was published Sunday on bahamasuncensored.com, a website that is the offspring of fredmitchelluncensored.com, which says its views do not represent the views of Minister Fred Mitchell, his Ministry or the Government of The Bahamas.

The column states, "The PLP, like most other parties, has its hardliners.  There is a herd instinct.  And so not withstanding the fact of all the history that has gone on before, the immediate reaction of too many was to denounce him, to remind him of his race, and to tell him as impolitely as possible go about his business.

"Then there are those who have impugned his motives by saying that the real reasons are economic and the fact that certain personal benefits did not come to him.  But all politics is about personal benefit of one kind or another.  Another set urged the PLP to cut Mr. Key off at the knees, decapitate him politically if it could be done.

Sandyport Developers Threaten To Sue The Coalition To Save Clifton Cay

The attorneys for Sandyport Developers, Emerick A. Knowles, has written to Rev. C. B. Moss, the Coalition's Chairman and Senate Vice President, claiming that his group defamed the Sandyport developers when it issued a release to the press dated February 6, 2004 

Sandyport Threatens To Sue Coalition

By Candia Dames

Nassau, The Bahamas

23/02/2004

The Coalition To Save Clifton Cay, a local group that fights against environmental degradation, is facing a lawsuit from the Sandyport developers.

The attorneys for Sandyport Developers, Emerick A. Knowles, has written to Rev. C. B. Moss, the Coalition's Chairman and Senate Vice President, claiming that his group defamed the developers when it issued a release to the press dated February 6, 2004.

Mr. Knowles warned in the letter, dated February 17, that unless the Coalition apologized in the press within seven days, "we will commence proceedings as indicated, without further notice."

Mr. Knowles said it was incorrect for the Coalition to report that it has proof that no environmental impact study was submitted or approved at the start of the project.  The Coalition invited Sandyport owner Hugh Buckner to provide the study for public inspection.

A government report obtained by the Journal last week states that no environmental impact assessment was carried out, the proof that the Coalition has been pointing to.

However, Mr. Buckner told the Journal that he did complete the study and that that study showed that his development would not harm the environment in any significant way.

A Ministry of Financial Services and Investments document dated December 17, 2002, said, however, that, "Regarding the environmental impact of the Sandyport Development, the [Bahamas Environment Science and Technology Commission] has advised that the Sandyport Development was approved prior to the creation of the BEST Commission and thus no Environmental Impact Assessment would have been done. 

"Various Government agencies would have issued permits for work to begin.  The BEST Commission recommends that a review be done of the conditions listed on the perms issued by the Department of Physical Planning and Ministry of Works and Utilities."

It was at this time that the Ministry of Financial Services and Investments invited the BEST Commission in close collaboration with the Ministry of Works and Utilities and Department of Physical Planning to undertake a full review of the Sandyport Development and to make recommendations as to any mitigating measures that would ensure environmental integrity.

Mr. Buckner has consistently reminded that he has received all of the approvals and permits from the relevant government agencies for his multi-million dollar project, which received high praises from Prime Minister Perry Christie who opened the latest phase of the development last November.

Mr. Knowles' letter to the Coalition said, "The statements were false in that the relevant authorities have approved the works being carried on at Sandyport including the work being carried on in respect of Phase V."

It also said that there are no health violations at Sandyport.

However, The Bahamas Environment Science and Technology Commission said in a document dated September 23, 2003 that, "The presence of solid waste and its reuse for fill at the site is a violation of the Environmental Health Act and posses a potential health problem as the decomposition of the trash will result in flammable gases seeping from the ground."

That document came as a result of a report commissioned by the National Economic Council.

Mr. Buckner suggested late last week that the government documents may not be authentic.  He said a few days earlier that the information may be erroneous.

Mr. Buckner's attorney said in the letter to Rev. Moss and the Coalition that the statements the group made in their press release were understood by ordinary persons to mean that: The Sandyport Development and the works being carried out at Sandyport are being done with no concern for the environment.

It continued that the statement by the Coalition also implies that Sandyport is carrying out works without appropriate approvals and in contravention of the law; and that the works of Sandyport are creating health hazards and are damaging to the residents of Sandyport and those living nearby.

The letter said, "Our clients are entitled to claim against you and members of the Coalition, general damages as well as aggravated damages for false statements appearing in the press statement, and to obtain an injunction against you and members of the Coalition to restrain you and them from making any further statements damaging to our clients' reputation and business."

The letter to Rev. Moss also said, "For the purpose of such proceedings we will require that you provide us the names and addresses of all members of the Coalition and should you fail to provide this information to us, we will obtain an Order from the Court to compel you to do so."

Edison Key Says That He Would Not Rescind His Letter of Resignation from The Progressive Liberal Party (PLP)

There is no way in the world that I can go back on my decision of my resignation from the Progressive Liberal Party - PLP; and therefore it is final, says Edison Key 

Edison Key: "It is finished."

Key Shakes Up PLP

By Candia Dames

candiadames@hotmail.com

Nassau, The Bahamas

20/02/2004

Former Progressive Liberal Party Senator Edison Key revealed to the Bahama Journal last night that two government ministers asked him to rescind his letter of resignation, but he said there is no way on earth that will ever happen.

Mr. Key also said that he hopes that his resignation sent a strong message to the party that it needed to get its act together.

"I hope it will be a wake up call for the leadership in the party," he said.  "And I hope that it will only cause the support out there to grow stronger and [create] unity within the rank and file of the party."

He said he met with Works and Utilities Minister Bradley Roberts, Foreign Affairs Minister Fred Mitchell and the Member of Parliament for Cat Island, Rum Cay and San Salvador Philip "Brave" Davis, Wednesday night who asked him to think twice about the decision he had made.

Mr. Key said these men are people whom he respects highly, but he said after a "frank talk we came to the final conclusion that my decision is final."

"Progressive Liberal Party and, therefore, we agreed that I need to submit an official resignation to the president of the Senate, which I will do very shortly and it will be official," he said. "In the meantime, I guess you could call me Senator."

 

Mr. Key spoke to the Journal about a meeting he had with Prime Minister Perry Christie in Nassau Thursday morning at which time he said he personally delivered a copy of his letter of resignation, which he was considering making public to the media.  He said he presented the letter in front of three Cabinet Ministers.

Mr. Key added he was "a little bit angry" that the prime minister did not get the original letter more than a month ago.

Mr. Key also said his letter outlined the manner in which he was treated since becoming a Senator under the re-incarnated PLP government.

He said he made it clear to Mr. Christie that he respected the office of Prime Minister, even though he criticized the country's leader earlier this week for lack of direction and poor leadership.

"The office of Prime Minister to me is an office that I respect next to the office of God," Mr. Key said.  "I am a Bahamian citizen.  I have nowhere to go and if we can't respect the person who holds the office, that's one thing, but the office of Prime Minister should be there to protect every single Bahamian for justice and right.

"I hope that prime ministers now and in the future will recognize the important role that they have to play as the leader of our country."

He said his meeting with the prime minister went "very well."

But he said, "I told him how I had tremendous hopes during the campaign and up until a few months after the election.  I told him how disappointed and hurt I am about the way I have been treated.  I told him this thing goes deep to my soul and there is no way in the world that I can go back on my decision of my resignation and therefore it is final.

"It is finished."

Mr. Key said he and the prime minister "parted on a very good note."

When asked if he thought his resignation hurt the party, he said, "I certainly hope not."

"I never had any intension to hurt the party.  That is not my intension.  I hope that it will only make them stronger and bring the people together in one accord and not divide it like it is today because it looks like we are becoming further and further apart."

Mr. Key added, "The decision I made was for Edison Key.  Other people will decide what they want to do."

"I've given 30-something years to this party and I'm still very much alive," he said.

Mr. Key added that he did not feel that he needed to attend a PLP council meeting held Thursday night because he didn't think Members of Parliament and party officers would speak freely if he were present. 

Widespread Environmental Degradation at the Sandyport Development - western New Providence Island, The Bahamas

Sandyport owner Hugh Buckner on the question of  Environmental Degradation at the Sandyport Development: ...it must not be overlooked that since the late 1970's he has secured all the requisite approvals from the relevant Bahamas government agencies

A Bahamas Environment Science and Technology (BEST) Commission report reveals that most of the wetlands in the area have been destroyed as a result of the development

Sandyport Bombshell

By Candia Dames

Nassau, The Bahamas

19/02/2004

Government documents obtained in a Journal investigation speak to the widespread environmental degradation officials say was caused by the Sandyport Development in western New Providence.

But Sandyport owner Hugh Buckner told the Journal that it must not be overlooked that since the late 1970's he has secured all the requisite approvals from the relevant government agencies.

A Bahamas Environment Science and Technology (BEST) Commission report reveals that most of the wetlands in the area have been destroyed as a result of the development.

The report was completed in compliance with the National Economic Council's directive which "invited the Minister of Health to cause the BEST Commission, in close collaboration with the Ministry of Works and Utilities and the Department of Physical Planning, to undertake a full review of the Sandyport development."

The wetland ecosystem at the development is approximately 98 percent destroyed and with the remaining wetland being slated for destruction all waterfowl habitat in that area will be lost, the report said.

"Due to the advanced stage of the Sandyport development and the destruction of approximately 98 percent of the wetlands, there is no benefit to the environment should the project be stopped," the report said, "unless extensive restoration attempts were made for the wetlands habitat which at this point is not a practical solution."

But Mr. Buckner on Tuesday insisted that his development has not been bad for the environment.

"We have the full permission of The Bahamas government to do what we've been doing," he said.  "Maybe the different departments should start talking to each other."

He also said that any information that his development has caused the destruction of 98 percent of wetlands in the area is erroneous.

Mr. Buckner said that while the environment may have changed as a result of his development, it has changed for the better.

"It's very beautiful and super," he said of the environment at Sandyport.  "I'm amazed at this complete ignorance and nonsense [of some people]."

BEST also documents a refuse-dumping problem at Sandyport.

"Since the verbal requests to remove the refuse and dispose of it at the sanitary landfill were not heeded, a public health order was served on 9th September 2003," the report added.  "If the problem is not rectified, then a submittal for prosecution will be made.  It should be noted that The Bahamas is a signatory to the RAMSAR Convention which has a mandate for the protection and wise-use of waterfowl habitat."

The broad aim of the RAMSAR Convention on Wetlands is to halt the worldwide loss of wetlands and to conserve those that remain through wise use and management.

The document also notes that the presence of solid waste and its reuse for fill at the site is a violation of the Environmental Health Act and posses a potential health issue as the decomposition of the trash will result in flammable gases seeping from the ground.

Last September, a group of inspectors from within the Ministry of Health and Environment toured the development and documented that several large mounds of contaminated fill (soil and garbage) were present on the eastern portion of the development.

But Mr. Buckner said that outsiders have been dumping at the site, a claim the report acknowledged.

The report supports claims that have been made in recent weeks by the Coalition To Save Clifton, an environmental group led by Senate Vice President Rev. C. B. Moss, who recently challenged Mr. Buckner, to "stop dodging and come clean" about his development.

The BEST report said, "Impacts to the groundwater may be created due to the apparent bulk heading of the marina only to the water level in some areas."

But Mr. Buckner said, "That is quite untrue."

In the latest phase of the development, Sandyport executives are seeking to build a road.  According to Lawrence Glinton, supervisor of construction for the Sandyport development who was named in the report, a portion of the wetland has been designated for a 40-foot road.

The report said that minimal healthy wetland areas remain on site, the most significant area running along West Bay Street from behind a nearby church to the limits of the Super Value property.

The BEST Commission report recommends that "the wetland system at the boundary of West Bay Street be maintained and restored and the proposed road either eliminated or realigned if possible to accommodate the entire east-west wetland area from Super Value to the back of the church to be preserved."

It also said, "The bulk heading of the marina areas to the east of the property may have profound flooding implications for the residents of Skyline Drive subdivision and Gambier as it may prevent the natural underground water flow during heavy rains and hurricanes.  It should be noted that Sandyport wetlands were the natural exist for large volumes of water to the sea prior to the construction of the Sandyport development."

Indicating that flooding relief should be provided to residents who live near Sandyport, the report adds that, "alternatives to the hard bulk heading on the eastern boundaries should be investigated to avoid exacerbating the flooding of residences surrounding Sandyport and provisions should be made to facilitate any upstream storm water, particularly from the east and west of the development."

Mr. Buckner pointed out that, "There are probably three public highways, not one of them has a drain.  The road to Super Value was built before our development and there is no drain."

In 1976, Sandyport Development Company Limited was granted approval to purchase approximately 142 acres of land to sub-divide and resell as multi and single-family lots.  A condition of the approval was that the Sandyport Bridge, at the junction of West Bay Street, be constructed before the first lot was sold.  The bridge is in place and, to date, Sandyport has sold a total of 350 multi and single-family lots.

Sandyport recently completed a $48.9 million shopping centre called Olde Towne, which includes 22 retail spaces owned primarily by small Bahamian businesses, restaurants, office space and approximately 50 apartments.

In August 1994, the National Economic Council granted approval for Sandyport Marina Beach Club and Resorts Limited to construct a timeshare and hotel resort.

A memo to Prime Minister Perry Christie from the Ministry of Financial Services and Investments said, "Regarding the environmental impact of the Sandyport Development, the BEST Commission has advised that the Sandyport Development was approved prior to the creation of the BEST Commission and thus no Environmental Impact Assessment would have been done. 

"Various government agencies would have issued permits for work to begin.  The BEST Commission recommends that a review be done of the conditions listed on the permits issued by the Department of Physical Planning and Ministry of Works and Utilities."

But Mr. Buckner insisted that his company conducted an EIA that addressed all environmental concerns and the government accepted that Sandyport would not have posed a significant threat to the environment.

Progressive Liberal Party (PLP) Senator, Edison Key Resignation from The Senate

Edison Key on Perry Christie and his poor leadership and lack of direction

PLP Senator Resigns

By Candia Dames

candiadames@hotmail.com

Nassau, The Bahamas

17/02/2004

Slamming the government of Prime Minister Perry Christie for what he called poor leadership and lack of direction, Progressive Liberal Party Senator Edison Key has resigned from the upper chamber.

"I've had it up to my eyeballs," Mr. Key said in an exclusive interview with the Bahama Journal Monday.

He said his letter of resignation - dated January 10 - was hand delivered to the prime minister's office, but he said he has not received any kind of reaction from Mr. Christie.

"I had hoped that Mr. Christie would have printed my resignation in full to the media so that the Bahamian people could see exactly why I resigned," Mr. Key said.

But Prime Minister Perry Christie told the Journal Monday evening that Mr. Key was revealing something to the Journal that he (Mr. Christie) was not aware of.

"I am not in receipt of a resignation from Mr. Key," the prime minister said.  "I have not seen it and I have asked my office to put a trace on it.  He has not telephoned me.  Anyone who has given as much to the PLP as Edison Key has should not demit public office in this way.  He has been a warrior.  He has the greatest admiration from me.  I am surprised that he has chosen to do it this way."

Mr. Key said that he has only been invited to one parliamentary meeting since May 2002.

"I don't feel like I need to waste any more of my life mixed up with this crew here," he said.  "I wish them well but I think they're in for a rude awakening at the end of the journey."

Although Mr. Key said he resigned five weeks ago, there has been no announcement from the government to this effect.

"I am very disappointed in the government and the leadership," Mr. Key said.  "I really serve no purpose in this new government."

But he was quick to add that he planned to remain a member of the PLP.

"I've been a part of the PLP from 1970," Mr. Key reminded.  "I've been through all the struggles and trials and tribulations.  I ran here in Abaco when you [would have been considered] an outcast to even identify with the PLP, especially a white man in an all white area."

When asked how he would characterize the performance of the Christie government since it came to power in May 2002, the former senator said, "On a scale of one to 10?  Maybe a three."

He said he was shocked that the prime minister has kept secret his resignation.  Members of the Senate reportedly did not know up to Monday that Mr. Key was no longer a senator.

"If you notice, it's all about Christie," he charged.  "I wish him well.  I don't want to say too much bad about him."

He added, "I'm surprised that the prime minister hasn't called me.  He hasn't responded to it.  I haven't gotten anything in writing from him.  I'm very disappointed and I just wish them well, but I have had it up to my neck bone."

Mr. Key said he did not feel valued as a senator.

"I've turned in dozens of applications and recommendations and not one of them has been acknowledged in over a year and a half," he said.  "There is no use me wasting my time...I'm not 16 anymore and there is no use me being a part of something that I'm on the outside of and I don't know what's going on. I'm a senator."

He also spoke to what he indicated was the uselessness of the senate.

"The senate has only met several times since the new government [came to office]," he said.  "It's a waste of money for the senators not to be a part of the overall decision making in the country.

"The government only expects when they send bills up there [for senators] to support whatever they send.  It's a rubber stamp and it needs to be considered whether the senate needs to stay in its present form or senators be elected so that they can speak their minds and say what they want to say."

Mr. Key served as a senator in the former PLP government from 1977 to 1982 and 1987 to 1992.  He also served as a Member of Parliament from 1982 to 1987 and 1992 to 1997. Mr. Key also served as chairman of the Bahamas Telecommunications Corporation from 1985 to 1992.

Corruption Rocks The Bahamas Electricity Corporation - BEC

Corruption Rocks BEC

ByCandia Dames

candiadames@hotmail.com

Nassau, Bahamas

10/02/2004

 

 

The Bahamas Electricity Corporation lost about $100 million over the last five years as a result of businesspersons and BEC employees working in cahoots in an unscrupulous practice that involves meter tampering.

 

New figures reveal that BEC lost $18.54 million in 2003 in non-technical losses.  New Providence accounted for $14.79 million in losses and the Family Islands made up for the remaining $3.75 million.

 

This serious leak in the corporation's revenue has reportedly been having a direct negative impact on the corporation's profitability for decades.

 

As a result, BEC is in the process of installing new electricity consumption meters, which can be read remotely and automatically, reducing errors and consequential queries.

 

The meters will be installed at all residences in the Bahamas and in the Family Islands that get their electricity from BEC.  The corporation is also putting in place a more high-tech system to cut back on the losses suffered when BEC workers under read the meters of commercial clients reportedly for kickbacks.

 

BEC officials expect that this will also result in reduced labour costs, a reduction in the need to estimate bills and a reduction in customer service queries as well as an improvement in revenue.

 

The losses occur as a result of wrongful actions taken by some employees in reading residential meters, but primarily among commercial clients, the Journal has learnt.

 

According to documents obtained by the Bahama Journal in a recent investigation, over the last five years, BEC's operating and administrative expenses had an average increase of 42 percent.

 

But the corporation's revenues increased by only 37 percent during the same period.

Actuaries have warned that the disparity in those two figures would create serious concerns for BEC unless the problem is arrested.

 

Corporation officials, who have put in place aggressive measures over the last year to make BEC more efficient, are said to be concerned as well about abuse of overtime and stealing within the corporation.

 

The Journal has learnt that while BEC still has a lot of house cleaning to do, some turnaround is already evident.

 

According to documents, accounts receivables improved by about $40 million as of the end of September 2003, standing at about $60 million, compared to $104 million the year before.

 

But while BEC makes what management has called much-needed strides to improve efficiency, it is faced with reaching conclusion on a new industrial contract for members of the Bahamas Electrical Workers Union.

 

The union is making several demands, including wage increases and improved pension fund benefits. BEC employees make no contributions to their pension fund.

 

As it stands now, the corporation contributes what would amount to 13 percent of each worker's salary to the fund.

 

But a recent actuarial report determined that the plan is under funded to the tune of $22 million. The corporation this year plans to make up that shortfall by increasing contributions to 16.6 percent.

 

This would amount to an annual increase in contributions made by the corporation from $4.5 million to $5.7 million.

 

However, the union is reportedly demanding that that amount be raised to 26.2 percent, which would mean a contribution of $7.6 million.

 

Because of the increases it plans to make as a result of actuarial realities, the corporation says it is in no financial position to address the union's request for a change in the actuarial rate.

 

Both sides are also said to be locking horns over a proposed merit pay system, which would reward employees, beginning in the third year of the contract, salary increases between 3 percent and 8 percent according to their on-the-job performance.

 

The corporation estimates that the new industrial contract would cost BEC an additional $16 million over a four-year agreement; but the union is reportedly demanding a $26.9 million increase.

 

Now faced with mounting pressure from the BEWU's leadership, BEC's board executives continue to point to what they say are realities they simply cannot ignore.

 

But the board, led by former banker Al Jarrett, continues to highlight its key accomplishments, like refinancing Inter-American Development Bank multi-currency loans, which will save BEC tens of millions of dollars in interest and exchange rate costs.

 

Other achievements are an historic reduction in electricity rates throughout the Bahamas, which executives say has had a major economic impact on the entire Bahamian economy.

 

There is also now a 3 percent interest payment on all customer deposits; Major savings in oil storage facilities from the signing of a new five-year contract last July; and major savings from the signing of a new five-year oil contract.

 

Mr. Jarrett, who came to the corporation promoting a partnership between BEC's management and union, is now facing increasing accusations from union leaders that he is anti-union.

 

At a recent corporation function, the Chairman said, "We must pay closer attention to the issues that divide us by creating more dialogue with staff members at all levels. We must listen more - be more focused on the vision and the mission, rather than tearing down each other."

Insurance Companies in The Bahamas Unite to Fight Against Colina Insurance Company Acquisition of Canada Life and Imperial Life

The insurance companies have banded together in an attempt to prevent Colina from getting regulatory approval to acquire Canada Life and Imperial Life

Insurance Row Heats Up

Candia Dames

candiadames@hotmail.com

Nassau, The Bahamas

09/02/2004

A group of insurance firms fighting two pending acquisitions by Colina Insurance Company is charging that the Registrar of Insurance Companies reported "erroneous" information to the Cabinet Secretary.

The 10 companies, in a response letter to Secretary Wendal Major, said the Registrar, Roger Brown, drew some unfortunate conclusions on the market share that Colina might enjoy if the transactions were approved, by using the combined health and ordinary life premium levels as a benchmark.

Mr. Brown had written to Mr. Major accusing the companies of lying in a recent PowerPoint presentation to Prime Minister Perry Christie. Mr. Brown also said that their charge questioning the actions of his office as it relates to Colina "is most damning".

The insurance companies have banded together in an attempt to prevent Colina from getting regulatory approval to acquire Canada Life and Imperial Life.  Although there was a media report last week that Colina received approval for Canada Life, there has been no confirmation or announcement in this regard.

Mr. Brown said it was "misleading and or derogatory" for the insurance firms to say that Colina will control 70 percent of the ordinary life insurance market.

In his letter, he said, "The use of the potential 70 percent market share statistic is somewhat disingenuous as in the local insurance market the different companies (other than Laurentide and Atlantis Medical) do not sell just one product."

He informed that, "Life & Health companies sell a variety of products and in this market "market share" is determined by the gross premium income from all Life & Health products."

Mr. Brown said that if all the acquisitions were approved Colina would control 43 percent of the total Life & Health market.

But the companies in their letter to Mr. Major, dated February 4, said it appears that the Registrar "has missed the point entirely."

"Our concern is not only on the level of premium income in the insurance industry controlled by any one entity but is also based on the fact that the transaction, if approved, will create an entity that will control very significant long-term financial assets with significant implications for correlation of the capital markets of the Country."

The Registrar provided Mr. Major a breakdown of the gross premium income of Life & Health companies, but the group of companies against Colina's acquisitions said this information was erroneous.

They said the breakdown in the letter understated Colina's premium income.

"All the premiums would have to be placed on a more comparable basis for the calculations on market share to be accurate or meaningful," they said.

The Registrar, who wrote to the Cabinet Secretary on January 8, said when his office received a report that Colina was soliciting business before its license was approved, letters to cease and desist were immediately sent out.

"In addition, a meeting was held with the principals of the company and a warning given directly that they must stop whatever they were doing," Mr. Brown wrote.

The companies said this action by Colina "speaks poorly of the controls, procedures and corporate governance standards of Colina."

Given that as of January 8, the Registrar's Office had not seen a signed Heads of agreement or a Purchase Agreement, the companies said, "In view of that reality, we do not understand how it was possible for the [Office of The Registrar of Insurance Companies] to approve the letter sent under date of December 1, 2003 by Imperial Life to the affected policyholders.

"This is particularly in light of the fact that Imperial's letter stipulated a deadline which clearly would have been arrived at long before the ORIC could even begin to review the merits and implications of the proposed transaction."

Fighting Colina's acquisitions are executives of Atlantic Medical Insurance Limited; Bahamas First Holdings Ltd; Fidelity Bank & Trust International Limited; British American Insurance Company; Insurance Management (Bahamas) Ltd; Sunshine Insurance Ltd; Family Guardian Insurance Co. Ltd; Security & General Insurance Co.; J.S. Johnson & Co. Ltd.; and RoyalStar Assurance Ltd.