WILLEMSTAD – For the time being the insurance entities have enough money to meet their obligations towards policy holders but there is a catch: the insurers must get access to funds that are parked at accounts with Merrill Lynch in the U.S. The solvency deficit spells trouble in the long run.

Getting access to the Merrill Lynch account is another story; this is where Ansary refuses to cooperate, according to the Central Bank.

For years the Central Bank has issued measures against ENNIA in attempts to decrease the outstanding with ECH and ECI and to promote a responsible and diversified investment of policy holder’s money. But even more severe provisions – like quietly putting ENNIA under supervision – did not yield any results.

After negotiations with ENNIA and major shareholder Ansary collapsed, Ansary suddenly have instructions to withdraw $100 million in policyholders’ money from ENNIA, with plans to withdraw another $150 million afterwards. This is when the Central Bank went to court and got approval to issue the emergency measure against the company.

After the emergency measure was established, the $100 million was returned to ENNIA. The Central Bank notes that $50 million came from a private account belonging to Hushang Ansary. “It seems that Mr. Ansary personally had part of the $100 million at his disposal,” the bank states in its press release.

Merrill Lynch has frozen the accounts in the United States to investigate who is entitled to these funds. “Merrill Lynch keeps the account frozen because Parman and its major shareholder Mr. Ansary did not want to confirm that the Central Bank is entitled to this money based on the emergency measure.”

The value of the investments at the Merrill Lynch accounts dropped by $36 million last week, the day before the lawsuit. The Central Bank says that media reports about a decrease in value by 150 million guilders ($83.8 million) are incorrect. Furthermore, the bank notes that this decrease in value only leads to real losses once the investments are sold.

Since the emergency measure was put in place, the Central Bank has obtained a better insight in ENNIA’s financials. “The irregularities we found are currently the subject of further investigation. Those responsible will be held accountable or criminally prosecuted.”

The lawsuit Parman has initiated in Curaçao against the Central Bank delays ENNIA’s restructuring process. The Central Bank also must go to court in the United States to get access to the funds parked at Merrill Lynch. On December 20, 2018, an American court acknowledged the emergency measure in the United States. But the position taken by Parman also delays this procedure, the bank says.