By NEIL HARTNELL
Tribune Business Editor
Government ministers were yesterday accused of unleashing “a tsunami wave” that threatens to swamp the Bahamian financial services industry by publicly releasing confidential information belonging to the Save the Bays.
Fred Smith QC, the environmental group’s legal director, told Tribune Business that several of his clients “intend” to switch their financial business from the Bahamas after Save the Bays’ confidential financial affairs and e-mails were read out in Parliament.
He slammed the “irresponsibility” of Cabinet ministers, Jerome Fitzgerald and Fred Mitchell, and Water & Sewerage Corporation chairman, Leslie Miller, for disclosing private information under the protection of Parliamentary privilege.
And Mr Smith questioned “to what end, to what purpose” did they elect to destabilise the financial services industry through their “party trick” in the House of Assembly.
“This is a tsunami wave hitting the financial services industry, when Government ministers should be so irresponsible as to publish private correspondence and financial information to the world about our affairs,” Mr Smith told Tribune Business.
“I have a number of clients who have indicated their intention to leave this jurisdiction; people who have International Business Companies and run their financial affairs from here, since that e-mail release.
“There are others who have shared with me their concerns that the Bahamas has become an irresponsible and abusive state, where no one’s privacy is protected. Again, this has really sent a shockwave through the financial services industry.”
The Bahamian financial services industry, often described as the economy’s ‘second pillar’, relies heavily on ‘privacy’ and ‘confidentiality’ of clients’ financial affairs as a key selling point.
Any suggestion that this confidentiality could be jeopardised, especially by a sitting Government, could result in major clients electing to switch their assets and business to a jurisdiction they believe will better protect their privacy.
Many of the Bahamas’ high net worth individual clients reside in nations that suffer from high crime levels, or frequent social and political turbulence, and they could have their personal safety endangered by the leak of sensitive personal data.
“This is calamitous for the financial services industry in the Bahamas,” Mr Smith continued,”that ministers should so glibly use information to embarrass private organisations, and people not even associated with its internal affairs......
“I ask Mr Fitzgerald and Mr Mitchell: To what end, to what purpose did they destabilise the financial services industry with this party trick in Parliament, seeking to embarrass persons who could not defend themselves. This is an abuse of Parliamentary privilege.”
Mr Smith was backed by fellow Save the Bays director, Sam Duncombe, who in a statement released yesterday accused the two ministers and MP of an “obscene violation of privacy”.
“How does this look to the world of investors and bankers, knowing that when the Government wants to, it will spy on them?” Mrs Duncombe asked.
She described as “an outrageous assertion” claims by Government ministers that Save the Bays was seeking to destabilise the Government, and added: “It seems to me they are doing a pretty fantastic job of overthrowing themselves.
“We have been called the ‘Bahamian Hustlers’. That’s laughable: Who are bigger hustlers than this government?”
Mr Smith, together with fellow plaintiffs, the Coalition to Protect Clifton Bay environmental group, and Zack Bacon, brother of hedge fund billionaire, Louis Bacon, subsequently obtained a Supreme Court injunction to prevent further disclosure of the documents obtained by the three MPs.
Mr Miller, during his mid-year Budget debate contribution, read out in the House of Assembly the alleged salaries being paid to Save the Bays members, which ranged from $90,000 to $250,000 per year.
Lakeisha Strachan, an attorney with the plaintiffs’ attorneys, Harry B Sands, Lobosky & Company, alleged in a March 18 affidavit that it was “clear” Mr Miller had seen a confidential document that “only a handful of people would have been legitimately privy to”.
The following day, Mr Mitchell, minister of foreign affairs and immigration, accused Louis Bacon of spending millions of dollars to “destabilise” the Christie administration.
Mr Fitzgerald, the minister of education, science and technology, then read out a private e-mail exchange between Save the Bays members and attorneys that was discussing a planned advertisement the group was preparing to take out.
“As with the financial records, only a handful of people would have had access to the above e-mail chain, and nobody was entitled to make it public,” Ms Strachan alleged.
“It is apparent, therefore, that there has been a leak of confidential and/or private documents relating to Save the Bays and its directors.”
Mr Smith yesterday conceded that Save the Bays and its members did not know how the group’s confidential information had been leaked, and whether they had fallen victim to computer ‘hacking’.
He added, though, that the environmental group was seeking to move rapidly with the ‘discovery’ process to “get to the root” of the leak.
Returning to what he sees as the wider consequences of disclosing Save the Bays’ private e-mails, Mr Smith said: “This is sending a clear message to the world that if, as and when the Government feels it is expedient to defend either itself or its friends, they will cross the Rubicon and throw caution to the wind, and terrorise the private sector.
“This means that no private financial information or correspondence is sacred, or is to be regarded as protected under bank confidentiality laws and the Data Protection Act, which are supposed to provide protection in a country that is supposed to be governed by the rule of law.
“Given that one of the primary industries in the Bahamas is the financial services and banking industry, I would have thought observers would be recoiling at the prospect of the Government setting its sights on any bank, financial institution, insurance company or foreign investor coming to the Bahamas, expecting privacy in its business and financial affairs.”