Sunday, January 21, 2018

GITA WANTS $49m MORE

Former corporate secretary files claim against CL Financial for benefits

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Gita Sakal

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Gita Sakal, who took a beating in the courtroom last week on her rich pay deal with failed conglomerate CL Financial, has made a US$7.7 million (TT$ 49.2 million) contractual entitlement claim against her former employer.

The former corporate secretary, who had an annual pay deal of US$2,480,000 in 2008 plus benefits of company car, health plan, a monthly retainer of TT$40,000 from insurance subsidiary CLICO and a US$5,000 a month board fee, has filed a claim against CL Financial for contractual benefits owed to her totaling US$7,743,650.12.

Sakal could not be reached for comment yesterday on her US multi-million-dollar claim made against the financially distressed conglomerate which has already received a $5.4 billion taxpayer bailout.

Her attorney, Rikki Harnanan, would say only that a claim has been filed.

However, people with knowledge of the situation told the Sunday Express that Sakal has made a claim for the remainder of her contract which expires on December 31 this year.

The former corporate secretary, who admitted in testimony to drawing up her own contract, has made the US$7.7 million claim on a built-in protection clause contained in the five-year contract which provides for the payment of full termination benefits, excluding all taxes.

Sakal, who quit her high paying job on April 30, 2009, mere months after the Central Bank's intervention into the troubled conglomerate, is claiming a US$2,370,300 salary entitlement for the eight months, May 1 to December 31, 2009, following her departure.

This demand is based on a monthly pay of US$46,287.50 and a fixed annual bonus of US$2 million.

The former high flying executive, whose contract contains a built-in clause which provides for a 15 per cent increase in salary for each year of the contract (January 2007 to December 2011) is claiming a contractual entitlement of US$2,638,767.50 net of all taxes for 2010 and US$2,734,582.624 for 2011, again net of all taxes, as provided for in the 2007 contract agreed to by former CL Financial executive chairman Lawrence Duprey.

Sakal's first monthly pay in the renewed five-year contract which kicked in on January 1, 2007 was US$35,000 plus the US$2 million a year bonus fixture.

In 2008, her monthly pay was US$40,250 and in 2009 when the company's fortunes started plummeting, Sakal was collecting a monthly pay packet of US$46,287.50.

She has also made a demand under clause seven of the contract which provides for full health and medical benefits for the life of the contract despite her separation from the company, according to sources familiar with the situation.

Sakal's demands for more pay comes at a time when a CL Financial owned investment bank (CLICO Investment Bank) is being wound up, two insurance companies are under State-supervised reconstruction and the holding company to which she was legal counsel, is under caretaker management.

It also comes at a time when the Board of Inland Revenue (BIR) has made a demand for unpaid taxes owed in relation to several former top executives including Sakal, Duprey and former group financial director Andre Monteil.

Included in the list of items flagged by the tax authorities is a $4.4 million consultancy fee paid to Sakal for unspecified work in 2008 for which no Pay As You Earn (PAYE) taxes were paid. The CL Financial caretaker management wrote to Sakal demanding that she provide justifiable evidence to support some of the payments she made to herself, including the monthly board fee of US$5,000 given the fact that she was never a member of the board of directors of CLF.

She has also been asked to provide an explanation about payments she made to herself of US$300,000 and Cdn$700,000, according to sources.

An account analysis for the year ended December 31, 2008, show that Sakal cleared payments of some $26.5 million from CL Financial, excluding taxes.

This is on top of the monthly $40,000 she received from CLICO. Sources say she has not responded to the demand from CL Financial.

Her claim, which is dated November 7, is said to have been met with resistance by the State-appointed CL Financial management.