The BAI, Again

Editorial

Let us hope that the next government will unearth truths, secrets and culprits in a manner more befitting of a proper democracy

By M.K.

The BAI affair is back in the news, courtesy of Roshi Bhadain, former minister of Financial Services and Good Governance. He recently stated that the dismantling of the BAI Group was the doing of Vishnu Lutchmeenaraidoo, then Finance Minister in the Alliance Lepep government. (The latter has not responded to this allegation, as he should, having gone back to his meditations.) Mr Bhadain also got the daughter of Dawood Rawat, Laina Rawat on his May Day platform in what appears to have been a well-calculated move to clear himself of the accusation (and public perception) of having been the Lepep Government’s principal hit man as regards the BAI’s dismantling. Video recordings of Mr Bhadain’s earlier press conferences at the time of the dismantling of the BAI Group — in the company of Vishnu Lutchmeenaraidoo, Financial Secretary Dev Manraj and other government officials – being presently circulated on social media platforms tell a different story.

At its Labour Day meeting the Labour Party has announced its intention to set up a commission of inquiry with a view to establishing the responsibility of all those who took the decision of or participated in the dismantling of the BAI Group – should it accede to power following the next general elections. There are certainly more revelations and disturbing facts to come out other than what is to be found in the nTan Report, commissioned by the Bank of Mauritius to look into the factors that led to the BAI’s failure. The Singaporean forensic experts did not have the mandate to probe into any political machinations that would have led to the Group’s dismantling, and one would expect that an eventual commission of inquiry will reveal such behind the scene games. Or will it?

Are we therefore in for a repeat of what started in 2015 when the Lepep Government went about to shoot down the BAI? Milan Meetarbhan, constitutional lawyer, in his interview to today’s edition of this paper, says: “The truth must be established as to how and why one of the biggest conglomerates in Mauritius was dismantled within a few days and whether the proper legal procedures were followed…”, adding that “We hardly know anything yet except for what some of the participants themselves have said about the most extensive act of expropriation and reversal of economic dilution in the country. Whether it was one Minister or another who triggered the whole thing is of no interest to the people. It happened under a government which is still in power and which has to take full responsibility for the dismantling with indecent haste of one of the country’s largest conglomerates without due process, without any form of compensation and with thousands of people being deprived of their life savings as a result of action by the authorities.”

What is known so far is that the Government’s handling of the BAI affair reflects a messy management of a bad situation — an already bad situation within the BAI before it went down aggravated by rash political decisions to precipitate the downfall of the former group as a political show. Instead, it ought to have been a well-advised and coolly calculated regulatory action intended to sustain public confidence in our financial institutions. After all, according to information that was circulating when the scandal broke, the IMF had previously drawn the attention of the authorities to the precarious financial situation of the BAI.

The result of this inept, bull-in-a-China shop approach is that several billions worth of taxpayers’ money have been poured in by the government to re-capitalise the ex-Bramer Bank in its new incarnation as part of the newly created MauBank and to compensate – only partly so far — BAI’s policy holders and investors. It has been a big price to pay for the country, adding to an already mounting debt burden which is dangeroulsy above the normative acceptable limit of 60% of GDP.

The people’s feelings about the local financial market have been seriously ruffled further by the eruption of more scandals, with several irregularities unearthed in this sector down the years. With the resurfacing of the BAI – which was almost inevitable in this highly-charged pre-electoral political atmosphere — the smell of corruption in the air has now become a literal stink, as political adversaries fight against each other about contributions received from large business conglomerates, but mostly from the BAI.

Politicians have preferred to fight among themselves than to own up about the donations that have been mentioned. However, since they have not denied either, the public will surely draw their own conclusion from that silence. The public is no fool, and has always held the view that corrupt support of political parties cutting across the board by financial and non-financial institutions of the country, has been here since long, maybe even before the Air Mauritius list of donations was revealed by the discovery of the ‘caisse noire’ or, as was put more cynically, the ‘carnet la boutique’.

The last thing that Mauritius needs is another traumatic series of cowboy-like burstings and hauling out of presumed guilty parties once the Commission of Enquiry has identified them with profuse and prolonged coverage on MBC-TV. Over the past four years the label ‘banana republic’ has been used a number of times with respect to the manner of official proceeding in several issues. Let us hope that the next government will unearth truths, secrets and culprits in a manner more befitting of a proper democracy – but at the same time ensure through due legal process that all those found guilty pay the price that they deserve for having taken suffering clients and the public for a ride.

* Published in print edition on 10 May 2019