Under the People's National Movement (PNM), the Urban Development Corporation of Trinidad and Tobago (UDeCOTT) invested $100 million in the then failing CLICO insurance company.
This claim was made yesterday by Housing Minister Dr Roodal Moonilal during his contribution to the Supplementation and Variation of Appropriation debate in Parliament.
Moonilal said he was "taken aback" that this information was kept quiet for so long.
"I think it looks like it was covered up somewhat, and the only time it got to the surface was when the Government went through the listing to pay back money, then we discovered who had money (in CLICO)," he said.
"It is the very first time I am hearing of it, and we have been in charge of UDeCOTT for two years, almost three years. It was one of these things that was hidden back from the books," he said.
Moonilal said even UDeCOTT's annual financials did not reflect that investment.
"We have had many problems with UDeCOTT where we cannot find documents, trace decisions. A lot of money was passing through UDeCOTT," he said.
"How they would pass that through a board of directors? I don't know," Moonilal said.
"Do you know they took $100 million of taxpayers' money? A special-purpose company; where they getting money from? They don't sell anything, they don't raise profits. UDeCOTT is not an investing company, " he said.
In an interview after his announcement, Moonilal said the issue only came to his attention "a few days ago".
"A document came for my signature; when I read it properly, I discovered that UDeCOTT had previously, I think around 2009, if I am not mistaken, taken around $100 million, maybe a little more, maybe a little less, and placed it into one of the financial instruments under CLICO," he said.
"I called for an enquiry into it to discover why it was done and under whose authority. At State enterprises, we follow a State enterprises manual, strict regula- tions in terms of the approval of the Ministry of Finance for expenditure. We are not investigating this," he said.
Moonilal said he could not imagine why a Government special-purpose company would make such a massive investment into the collapsing insurance giant.
"UDeCOTT is now going cap in hand to the Minister of Finance, asking what kind of deal you have to offer citizens, please offer us the same," he said.
With this newly uncovered information, Moonilal said this may soon become a legal issue for those involved.
While the minister was careful not to implicate anyone by name, he asked his colleagues to "connect the dots".
"Who would have heard of CLICO's problems and got UDeCOTT to put $100 million into CLICO?" he asked.
With the Government's offer of $0.80 on the dollar, UDeCOTT stands to get a payback of $80 million for that investment.
"That $20 million, the taxpayers lost that," he said.
Moonilal said he referred the matter to Attorney General Anand Ramlogan for further investiga- tion. Ramlogan later confirmed the matter had been referred to him.