$30m dividend for Grotto may be illegal

A CONTROVERSIAL ISSUE in a Special Audit of National Housing Corporation high rises – to which Government has not responded – is the possibly illegal use of monies from the Housing Credit Fund as a dividend to pay nearly $30 million for the Grotto complex.

It is now emerging that Government ignored its own legal advisers and
went ahead with the payment even though it was informed, as noted by
the Auditor General, that “the transfer of $30 million from the Housing Credit Fund to the Government cannot be substantiated in law”.

Almost three years ago, Government sought a legal opinion on whether the Trustee of the HCF – the Central Bank – has the power under the Trust Deed
to pay a dividend out of the Fund to the Government.

This was against the backdrop of a letter dated March 10, 2015, from the managing director of the company, Preconco Limited, to Minister of Finance Chris Sinckler. (AB)

Please read the full story in today’s Sunday Sun, or in the eNATION edition.