In T&T: Ex-CL Financial Executive Sued Over 3.4 Million Loan

28 October 2011

The CL saga continues…former executive has unpaid loan which was given to him by CL Financial to acquire the group’s media unit. Interesting!

The Government-appointed caretaker management of failed conglomerate CL Financial has sued former executive Anthony Maharaj over an alleged unpaid loan related to his 2007 acquisition of the group’s media unit, CL Communications Ltd.

The lawsuit filed on Monday is seeking damages for an alleged unpaid debt of some $3,441,937 owed to CL Financial plus damages, interest and legal costs, among other things.

According to the statement of case made out against Maharaj—a major player in former CL chairman Lawrence Duprey’s media ventures and managing director of CL Communications—reneged on an April 17, 2007 promissory note to CLF for a block of 70,009 shares held in the group’s media unit.

The action, filed by attorney Kim Berkeley, contends that Maharaj “wrongfully omitted, failed and/or neglected to pay the promised sum” of money on or before June 30, 2007 for the receipt of CL Communications shares. The lawsuit does not say why the Maharaj debt issue was not resolved before now but details two demands made for payment in the post January 30, 2009 collapse of the Duprey-run business empire.

A demand for payment on the outstanding debt was made by Winston Millette, group chief financial officer, CL Financial on June 14 and again on June 22 this year. The June 22 correspondence which referenced a response from Maharaj’s attorney Dharmendra Punwasee made clear that CL Financial was not inclined to grant Maharaj’s request for an extension of the seven-day settlement deadline which Millette had issued in his letter of June 14.

The June 22 correspondence instead put Maharaj on notice of CL Financial’s intention to sue for recovery of the outstanding debt if he did not immediately settle the account. Maharaj’s attorney, in a response to Millette two days later, however, insisted that the debt had been settled in full. He said the CLF debt was paid via two cheque payments, the first by way of a CLICO Investment Bank (CIB) manager’s cheque dated February 14, 2007 and the second, by way of a $2,384,615 cheque paid directly to CL Financial’s account by former group financial director and former chairman of CIB, Louis Andre Monteil &/or his wife Sherlyn Rose Marie Monteil.

E-mail correspondence from CLICO’s accounting officer Corrie Gomez to Millette, however, made clear there is no evidence on record that any such payments were received by the CL Financial group.

Gomez, in the court filing, said that Maharaj’s claim of a $15 million CIB-issued cheque paid to CLICO could not be substantiated.

Maharaj’s attorney had said that $1,057,322 of the $15 million cheque payment had been applied to the CLF sale of CL Communications shares.

An August 3, 2011 Millette e-mail to Gomez, which forms part of the court proceedings against Maharaj noted Maharaj’s attempt to offset charges owed by CLICO to the media group, specifically: a $3,589,552.78 payment related to the Mystic Masseur movie and advance payments of $6,381,900 related to the 2009 Tobago Jazz Festival, which was cancelled.

The Millette e-mail also pointed to receivables of $13,454,455.79 from Video Associates, a production house which is part of the media unit comprising a television station, ieTV and four FM stations: 97.1, 90.5, Ebony 104.1 and Heartbeat 103.5.

Maharaj yesterday expressed shock at the legal action mounted against him, saying that he has repaid all of his debts to the CL Financial group in full.

He could provide no explanation for the missing loan documents relating to the initial $15 million borrowing from CIB or the payments he said he made to CLICO and its parent company. The Ernst & Young post collapse statement of affairs on CIB raised concerns about a $15 million loan advanced to a director of CL Communications without a corresponding loan account being created.


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