The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

The Bahamas Institute of Chartered Accountants (BICA) president yesterday warned against "muddying the water" over Sarkis Izmirlian's $2.25 billion damages claim against Baha Mar's main contractor.

Gowon Bowe told Tribune Business that it was important to recognise what the lawsuit was, and what it was not, emphasising that it should not be viewed as a "Baha Mar issue" but a private battle between Mr Izmirlian and China Construction America (CCA).

"First and most importantly, we must look at the parties involved and separate them," Mr Bowe said. "Baha Mar is currently owned by Chow Tai Fook Enterprises (CTFE), which is not a party to any of these proceedings.

"Nor is the China Export-Import Bank, which recovered the assets under receivership. When you talk about Baha Mar, the most important aspect this involves is the parties to the original development and not the current developer who is free and clear of the proceedings."

Mr Bowe's point is that Mr Izmirlian's move should not be perceived as, or impact, the Baha Mar development's actual progress and ongoing operations, since these are not the subject of his action.

"China Construction American is a foreign developer in the country, and they are also investors in other projects, such as The Pointe which are not parties to the suit," Mr Bowe added. "What it boils down to is the original developer feeling aggrieved by the performance of the construction company relative to the contract. We have to be very careful not to muddy the water and call it a 'Baha Mar issue'. This is no longer a Baha Mar issue.

"From a government standpoint it will be important to monitor CCA's participation in their role as developer at The Pointe, what this does to their financial ability depending on how the cookie crumbles in the court proceedings and their reputation, depending on whether or not the allegations are found to be of merit."

Mr Izmirlian has accused CCA of "one of the largest construction-based frauds in this hemisphere".

The $4.2 billion Baha Mar's original developer, in a lawsuit filed in the New York State Supreme Court, alleged that CCA and its subsidiaries perpetrated a "massive" scheme of "cover up", "deceit", "outright sabotage" and lies to both conceal its failures and "extort more money than it earned".

The action, filed in the name of Mr Izmirlian's BML Properties vehicle, claims that the Chinese state-owned construction firm deliberately concealed its intention to use Baha Mar as "a massive training exercise" that ultimately doomed the project to failure.

Earlier this month, CTFE released a statement confirming that its purchase of Baha Mar had been completed, making it the sole owner of the multi-billion dollar resort on Cable Beach.

Baha Mar currently employs 3,500 Bahamians with that number expected to reach over 5,000 by the end of 2018.