It has been alleged that a ?senior member of the BIU? ordered Credit Union loan officers to go ahead with an illegal loan to the tune of nearly $3 million, Opposition leader Grant Gibbons said yesterday.

Dr. Gibbons also questioned again whether members of the Bermuda Monetary Authority (BMA) were forced to bow to political pressure and sweep the matter under the carpet.

The BMA alerted the Ministry of Finance in September, 2003 to the loan, which the Bermuda Industrial Union (BIU)?s Credit Union made to Union Assets Holding (UAH). UAH is the BIU-owned subsidiary which provided the completion bond for the new secondary school.

?There are clearly political agendas involved, and huge conflicts of interest,? Dr. Gibbons said yesterday. ?You have a Government which has disclosed little about the Berkeley issue.

?Union Assets Holding has officers sitting in Parliament. Government is concerned politically about the success of the Berkeley project, the bond, and issues of financing. There is also a close connection between the BIU and the PLP.?

The BMA?s 2003 Annual Report mentioned, as far as Dr. Gibbons could see, nothing about the illegal loan, which was repaid in 2004.

He quoted from the Report: ??In addition, towards the end of 2003, the Authority conducted an on-site review visit to the Credit Union, in order to test the effectiveness of the systems and controls, as well as its procedures for ensuring compliance with anti-money-laundering requirements?.?

?That?s it,? Dr. Gibbons said. ?That?s all they say!?

Nowhere in the report is any mention made of an illegal loan 15 times what the Credit Union is allowed to lend, despite Ms Cox saying in a press statement that the BMA inspection was ordered by former Finance Minister Eugene Cox as a reaction to the discovery of the $3 million loan.

?There is nothing to tip off any member of the public that anything was wrong,? Dr. Gibbons said. ?From my perspective no concern was expressed.

?I am outraged that this has been swept under the table by the Minister of Finance and the BMA. Was there any political pressure on BMA staff to downplay this issue?

?It has been alleged that the loan officers were instructed by a senior member of the BIU to go ahead (with the loan),? he added.

?If so, what actions have been taken? What has been done to protect the ordinary BIU members from this happening again??

Ms Cox had confirmed that the loan was illegal, he said, yet auditors noted that to date no action ? apart from orders that the loan be repaid ? has been taken.

Had this taken place in a bank or a deposit company, Dr. Gibbons said: ?There would?ve been hell to pay.?

The lack of enforcement action also left Dr. Gibbons concerned about the credibility of the BMA and the Ministry of Finance. ?We hear a lot of pious words about protecting Bermuda?s international reputation ... But the ordinary man is just as important.?