Mysterious withdrawals from TCI Bank likely caused its closure; NIB lost millions and still owed

#Providenciales, May 1, 2019 – Turks and Caicos – Three mysterious withdrawals from TCI Bank back in December of 2009 may have been the catalyst for the collapse of the bank four months later in April 2010.

Almost exactly nine years after the colossal event, where millions in depositors’ dollars were reduced to dimes, TCI Bank is back on the radar due to a line of questioning from Hon Doug Parnell, Chairman of the Appropriations Committee.

Among those suffering a dismal and expensive loss was the National Insurance Board, NIB, which not only invested in TCI Bank but held over $17 million in fixed deposits at the bank which ultimately went bust.

It is published that $15.8 million was lost in the failure of TCI Bank by the National Insurance Board.

The move to invest so much – over $22 million in stock and deposits – was categorized as a “bad investment” and one which was made in contravention of the NIB’s own protective policies.

Director of the NIB at the time was Trevor Cooke; he told the Turks and Caicos Weekly News that: “Criticism is expected. TCI Bank has closed its doors, we lost $2m in equity and we stand to lose some, if not all, of the $17.5m we had in fixed deposits.”

The liquidators – Anthony Kikivarakis and Mark Munnings – are still working on the messy matter, but regular reports, which are posted to the TCI Bank website, have exposed that a $5.5 million loan from the NIB in 2009, given to stabilize the bank did not work because of a trio of major withdrawals, amounting to $4.5 million within 90 days of that NIB loan deposit. 

The unexplained draw-downs deepened the problems of insolvency at TCI Bank and eventually, heartbreakingly all three branches: Grand Turk, North Caicos and Providenciales were closed.

Last week, NIB Acting Director, Rhesa Cartwright and Financial Controller, Marie Smith appeared before the Appropriations Committee of the House of Assembly. 

It was reported by the pair of NIB executives that the losses resulting from TCI Bank’s closure continue to be a part of financial reports; including the NIB’s audit report.  Mr. Parnell asked about whether it would be removed.

Marie Smith, Financial Controller responded with, “No, we are not able to, it will remain until the liquidation is completed because the liquidation is still in progress as we speak… and it will also be a point of contention in any audit report that is presented.”

Several media reports explained that over the years and following a successful lawsuit against TCI Bank by the NIB, the $5.5 million of beneficiaries’ monies was returned to NIB.

“We have received reimbursements from TCI Bank; as a matter of fact, we did provisioning of 56 percent of what was outstanding and to date, based on our provisioning the monies we have received back from TCI Bank, we just have a balance, based on the provisioning, of just over $700,000 in receipt. But that does not say that we will receive it because we could receive ‘it’, as well as we could receive more.”

Magnetic Media’s review of various reports reveal that the NIB has recouped around $7 million; approximately $10 million was lost.

“…based on the written down number, we have received – I think – forty-cents out of the dollar.”

Appropriations Committee Chairman Parnell has requested a report on the status of the TCI Bank liquidation in relation to the NIB.

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