St Kitts and Nevis PM raises red flag over CDB president’s suspension

Dr Gene Leon’s return to his position as president of the Caribbean Development Bank (CDB) appears unlikely in the near future, as concerns persist regarding the bank’s handling of whistleblower complaints against him.

Tensions escalated in February following perceived disregard from Ahmed Hussen, the Canadian minister currently chairing the CDB board of governors, in response to concerns raised by nine heads of government from the Organisation of Eastern Caribbean States (OECS).

Dr Terrance Drew, the St Kitts and Nevis prime minister, in his capacity as chairman of the OECS Authority, wrote a letter to Hussen expressing concerns.

But in a sharp reply through a law firm, the CDB said, “This is an internal bank matter and is not within the jurisdiction of the OECS.”

The missive continued: “Therefore, to maintain the integrity and confidentiality of the investigation, we recommend you cease from commenting on this matter publicly and from contacting the board of governors regarding the investigation.”

The Barbados-based bank sent Leon on administrative leave in mid-January for three months and confirmed through its acting president Isaac Solomon that there was “an internal administrative process involving the president”.

Last week, The Sunday Gleaner asked the CDB whether Leon would be returning to work in April and about the process that led to the probe, among other queries.

Its response was brief.

“The administrative process involving the Caribbean Development Bank’s President, Dr Hyginus ‘Gene’ Leon, has not yet concluded,” it said. “The CDB continues to prioritise the independence, integrity, and confidentiality of this process. Therefore, the bank is not in a position to make any further disclosures on the matter at this time.”

The Sunday Gleaner has been unable to reach Leon for a comment.

The CDB is a key financier, through loans and grants, of development projects in the Caribbean. It comprises 19 borrowing member countries, mostly CARICOM states, which have 55.26 per cent of the voting power on the bank’s board.

Nine non-borrowing member countries that provide capital have the remaining 44.74 per cent of the voting power. They are Canada, the United Kingdom, Brazil, Colombia, Mexico, Venezuela, China, Italy, and Germany.

Leon, a St Lucian economist who worked with the International Monetary Fund for 24 years, was elected president by the governors of the bank in January 2021 and started on a five-year contract on May 4, 2021.

News of his suspension shocked the region, particularly after it appeared that the move was not sanctioned by the board of governors. Other senior CDB officials have also been suspended.

Those concerns were put directly to Hussen, the Canadian chairman of the board of governors, in the letter from the OECS Authority, which is made up of the heads of government of a subregional group of 11 member states. The authority is the supreme policymaking body of the OECS and is responsible for the general direction and control of the performance and functions of the organisation.

“We are deeply concerned about the resulting situation,” said Drew, the St Kitts and Nevis PM and chairman of the OECS Authority, in the letter, a copy of which was seen by The Sunday Gleaner.

Drew, who is also the vice chairman of the CDB board of governors, copied his January 22, 2024 letter to CARICOM chairman and Guyana President Dr Irfaan Ali and Secretary General Dr Carla Barnett.

Drew noted that the January 15 letter informing Leon of his suspension that came from the Oversight & Assurance Committee (OAC), which he said “is an advisory committee of the board of directors of the bank”.

“The code of conduct of the board of directors limits the role of the OAC to making recommendations to the board of directors,” Drew said, before contending that “this rule was not observed because the suspension decision was not made by the board”.

The code of conduct empowers the OAC to receive complaints and assess whether an investigation is warranted. If it determines that further investigation is needed, it must make a recommendation to the board of directors, which has the final say.

But Drew is contending that the OAC’s action “appears to have been precipitously taken and not in accordance with the established rules”.

As to what CDB governors knew in January, Drew was revealing.

“We have confirmed that the governors representing the OECS members and at least some CARICOM governors had no prior knowledge, nor was there any prior consultation or due process in the exercise of this measure,” he said.

“We have been advised and believe that the measure was invalid and outside the scope of the authority of the OAC, effectively usurping the powers of both the board of directors and the board of governors,” he added as he expressed concerns for the CDB’s reputation.

He urged Hussen to convene an urgent meeting “to prevent further hemorrhaging of the reputations of the bank and the individuals involved”.

Drew did not get a direct response from the Canadian minister.

A response dated February 1, 2024, came from Arnold&Porter, which represents the CDB. It dismissed the allegations against the OAC.

“The actions taken by the bank regarding an independent administrative investigation into the whistleblower complaints lodged against Dr Leon are in full compliance with the agreement establishing the Caribbean Development Bank and the bank’s strategic framework for integrity, compliance and accountability,” the law firm said.

Some regional governments were not pleased that Hussen did not respond to Drew directly and accused him of being dismissive.

“It was a very rude thing to do. Eight heads of government write to you and you send some law firm to lecture us in the Caribbean?” argued a senior CARICOM official, who was not authorised to speak on the matter.

Talks have been held since, including at the CARICOM level, but leaders have remained silent publicly.

The Sunday Gleaner submitted questions last week to several regional heads of government.

Drew’s office indicated that he was overseas on business for two weeks and may not be able to address the questions any time soon.

Angie Williams, permanent secretary in the Office of the Prime Minister for St Vincent and the Grenadines, said it would not be “appropriate” for Dr Ralph Gonsalves to comment publicly on the matter “at this time”. (Jamaica Gleaner)

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