Anil Nandlall defends Brassington brothers
“…you have to find that there was some collusion to the detriment of the shareholders interest and then a conflict of interest arises” – Anil Nandlall
By Gary Eleazar
Winston Brassington, the Executive Director of the National Industrial and Commercial Investment (NICIL) who recently came under fire for a transaction involving him, his brother Jonathan and some 2.2 million shares at Hand in Hand Trust Corporation has done nothing wrong.
This is at least according to Guyana’s Minister of Legal Affairs, Anil Nandlall, who told this publication that there is not even a conflict of interest situation that arises out of the sale in the shares.
“I don’t know of any transaction in which (Winston) Brassington’s personal conduct has been under scrutiny,” said Nandlall as he expanded on the sale of the shares.
“GNCB Trust was privatized and then seven years after Brassington’s brother, as an independent person who lives in America and who is quite accomplished, choose to invest in a company in Guyana…that is being made a controversy.”
Nandlall argues that Winston Brassington is the constituted power of attorney for his brother and as such could have acted on his behalf.
“He does the transaction on behalf of his brother, what is wrong with that…there is no conflict of interest.”
Winston Brassington was the head of NICIL when it acquired the Guyana National Cooperative Bank (GNCB) Trust. NICIL then sold the GNCB Trust to Hand in Hand Insurance Company.
On October 13, 2003, the insurance company passed a special resolution to change the name of the new asset to Hand in Hand Trust Corporation.
NICIL, still headed by Brassington, became a major shareholder in the company.
NICIL held 250,000 shares in the Trust; the majority of shares was held by Hand in Hand Fire Insurance Company.
In 2009, by order of a resolution passed by the Board of Directors at Hand in Hand Trust Corporation, “the Board authorized an increase in the Trust Corporation Share Capital from $250M to $750M and further authorized the issuance of Preferred/Ordinary Shares to cover the increased Share Capital.”
This meant that the Trust increased the volume of shares from 2.5 million to 7.5 million at $100 per share.
Immediately, Jonathan Brassington bought 2.25 million shares for $225 million. This purchase gave him a one-third ownership in Hand in Hand Trust Company.
By September 2009, Winston Brassington who still represented NICIL as a major shareholder in the Trust company, signed for these shares on behalf of his brother who was at the time and still remains overseas.
Nandlall argues that there is no conflict of interest in the transaction on Winston Brassington’s part, “how could that be a conflict of interest,” asked Nandlall.
Speaking to allegations of insider trading on the part of Winston Brassington when the shares were sold to Jonathan for whom he signed, Nandlall firstly pointed to the fact that the sale was undertaken seven years after GNCB trust was privatized.
“So because your brother sits on a board you are disabled some way from doing business with that board.”
Nandlall says that the proposal by the Brassingtons had to be vetted by the Guyana Central Bank
“Is it because I am in government, my entire family is incapacitated from doing a transaction with the government?”
The Government’s Legal Advisor argues that as long as there is “full and frank disclosure, anybody can do business with anybody.”
Nandlall stressed the point that there must be established a withholding of information, “you have to find that there was some collusion to the detriment of the shareholders interest and then a conflict of interest arises.”
Alliance for Change (AFC) Chairman Khemraj Ramjattan had leveled several serious criticisms of the transaction saying that it is tantamount to financial fraud.
He argues that with the culmination of that transaction, “a Brassington became the second largest shareholder in a Brassington-privatised company…This is not only corruption: it meets the test of fraud.”
Ramjattan cautioned the NICIL Executive Director saying “I hope that Mr. Brassington has not changed his mind so that he can prevent access to the files and records that will conclusively establish the mounting evidence of fraud, corruption and illegalities surrounding NICIL which has surfaced with every passing day.”