In its first week of hearings, the Commission of Inquiry held 9 hours of public hearings in which four witnesses testified. The first two on Tuesday were former employees, and Thursday's pair were current employees. And while the witnesses thus far have been candid and revealing, all they have shown is a corporation that was recklessly managed where politically well connected individuals got loans, didn't pay them, then got more loans to pay the first loans - and through all that were still protected by the Board of Directors and management.
The DFC Commission is now trying to build a case from the ground up, and to do that, the first to come in are the ground workers, those who saw huge and ballooning debt portfolios pass beneath them, but who were powerless to act on it conscientiously because they were sensitive loans, meaning someone who got them had political connections. And who are those people well in the first week a few names were said repeatedly.
Commissioner Merlene Bailey-Martinez has never been reluctant to name those names of those who were afforded special treatment.
Edwardo Torres, Loans Recovery Officer
"The following accounts continue to be of primary concern: Khalid Nasser, Derrick Boyd..."
Merlene Bailey Martinez, Commissioner
"That's Cahal Pech yes."
Edwardo Torres,
"Arnaldo Pena and Western Development Limited."
Merlene Bailey Martinez,
"Okay thank you. I just wanted to make sure we had that clear."
It's clear all right, clear that DFC was systematically mismanaged until it collapsed under its own weight. But those still working with the DFC weren't about to badmouth their employer.
David Price, Commission Chairman
"If you had to characterize the position of the DFC at that time, how would you characterize it?"
Edwardo Torres,
"As if bad or...?"
David Price,
"Yes."
Merlene Bailey Martinez,
"Excellent or..."
Edwardo Torres,
"Bad."
Merlene Bailey Martinez,
"Mrs. Reid do you have any concerns whatsoever about the management of this portfolio? Any concerns at all?"
Gloria Reid, Assistant Securitization Officer
"No, I think it is managed well."
Merlene Bailey Martinez,
"Every thing is, as they say, peachy creamy with?"
Gloria Reid,
"Yes."
Merlene Bailey Martinez,
"You had no problem with it all."
Gloria Reid,
"Yes."
And while Reid had no problem, Eduardo Torres, the present loans recovery officer made it clear he knew there was some stuff he just couldn't touch.
Merlene Bailey Martinez,
"Was it common knowledge what loans constituted sensitive loans and were you ever surprised that these loans were not in the pool that you were supposed to follow up? Were you ever surprised?"
Edwardo Torres,
"Yes."
Merlene Bailey Martinez,
"Okay and what satisfied that curiosity for you because what... because you knew what?"
Edwardo Torres,
"Because it was on hold because of sensitive reasons."
Merlene Bailey Martinez,
"Have you experienced all of those things Mr. Torres?"
Edwardo Torres,
"You mean the inaction?"
Merlene Bailey Martinez,
"In adequate collateral, a difficult location, aging of the loans beyond twelve months, sometimes compounded by additional loans, compounded by inaction by the board. Have you experienced all of those things at the DFC? What I am asking is have you experienced loans that fall into all of those categories. What particular loan, like say this loan basically falls into all of those categories that make it difficult to recover. Any particular loans?"
Edwardo Torres,
"Like Novelo's?"
Merlene Bailey Martinez,
"Did Fountain Blue Limited?"
Edwardo Torres,
"I think that was one that didn't clear."
Merlene Bailey Martinez,
"James Jan Mohammad in his own person."
Edwardo Torres,
"I have never foreclosed on that."
Merlene Bailey Martinez,
"We have Arnaldo Pena."
Edwardo Torres,
"We are foreclosing on that right now."
Merlene Bailey Martinez,
"At this point in time, but what about prior to this, we are talking up to 2004."
Edwardo Torres,
"Now that I have seen the file, I would say that it would be in."
Merlene Bailey Martinez,
"Belize Resort and Development?"
Edwardo Torres,
"Same."
Merlene Bailey Martinez,
"Same person, right. So it would have fallen into that category with all those obstacles to recover."
And when those big loans failed, they came to the desk of Gloria Reid, the assistant securitization office who had to make sure DFC met its external commitments.
David Price,
"If a loan, any of these loans over $1 million defaulted, how was that remedied?"
Gloria Reid,
"Well we take it out and if we have to put in 50 loans to replace then
that is what we would do."
David Price,
"Assuming of course that you have 50 loans that would add up to the value."
Gloria Reid,
"Yes sir."
David Price,
"If you don't have 50 loans that add up to the value, what do you then do?"
Gloria Reid,
"Well we always could find loans."
The hearings are scheduled to resume on Tuesday and barring any legal action against the commission they will be aired live on right here Channel Seven.
