Gordon Robinson | When a bailout isn’t a bailout

The three-ring circus at Stocks and Securities Limited (SSL) continues with Nigel Clarke as Ringmaster.

Let’s refresh. FSC flagged SSL six plus years ago for “a culture of noncompliance and mismanagement of client funds”. FSC threatened to suspend SSL’s license but was convinced otherwise. An adverse report, sent to Finance Minister (2019), was, according to Nigel, “lost” in filing cabinets. Internal investigations (2022) exposed the Bolt fraud. Suddenly 2019’s report was found and investigations frantically escalated.

So, including by FSC; FID; Finance Ministry; international investigators; Kroll (financial/risk advisors), SSL has been under investigation for more than SIX YEARS. Since January, Government’s Temporary Manager has been in operational control. Yet, at end August, SSL staff were still employed and had the brass balls to protest unpaid salaries.

In swifter reaction than any recently protesting public servant experienced, Nigel decided Government should pay SSL salaries and operational costs. When Jamaica erupted in disgust he insisted it wasn’t a bailout but essential to investigations.

Wha, wha, WHAT?

Government pays multi-millions monthly to cover SSL’s corporate expenditure long after SSL is insolvent but Nigel says Government won’t be able to subsidize customer’s losses. Exactly how is that NOT a bailout?

Nigel’s version (given September 1):

“The investigation is at a stage where the investigators have made it very clear to me in no uncertain terms (Holy tautology, Batman!) that having the employees in place is critical to the [investigation’s] progress.”

Utter. Rubbish! All fraudulent transactions leave digital/paper trails. Properly resourced regulators swoop in; seize all electronic devices; halt ALL business to avoid obstruction; and interrogate employees.

If FSC included an Enforcement Unit, it would’ve been leading this investigation and feeding FID with the same information that produced earlier reports. To unearth evidence from paper/hard-drive trails, FSC’s Temporary Manager should have his own staff (including independent I.T. experts and ethical hackers). FSC should be as familiar with operations as SSL staff.

Nigel continued;

“I have faith and confidence in our investigators.”

Well, goody, goody Twoshoes! If a fraud investigation needs its subject’s employees to remain every investigator should be fired. That’s not how forensic investigations are conducted. Suppose employees become suspects?

This MUST be the Guy Lombardo Show!

Nigel warbled on:

“If I made another decision…..the investigation would be compromised”

Lord deliver us! Is Nigel REALLY trying to tell us all the culprits need do is murder SSL staff (or firebomb the offices) to avoid exposure?

Professional investigators use modern tools to determine/quantify fraudulent transactions and identify miscreants. It should also be obvious, even to Inspector Clouseau, that bank fraud is usually perpetrated by managers/employees colluding to circumvent protocols. So, by all means, keep managers/employees and ensure they’re paid. Don’t bother hiring outside forensic experts.

The multi-million US$ question is: Why this blatant sham? Who benefits?

SSL investigations began internally over a year ago; externally over six years ago. What’s left for SSL staff to show/tell investigators? Why is Government so anxious to keep them?

Nigel: “The sole motivation of the temporary support is to facilitate what hasn’t happened for 30 years which is a transparent complete unfettered and thorough investigation into this matter.”

That “30 years” throwaway is cute. Tribal Trolls’ favourite refuge, obsessive compulsive whataboutery, has already resurrected FINSAC. But FINSAC bailout is similar to SSL bailout only in that both were/are done to save Government’s face.

There was/is NO OTHER PURPOSE.

FINSAC, a pre-FSC scandal, happened due to insane interest rate policies destroying small businesses and banks alike. Then Government stuck its head in sand for TWO YEARS after receiving specific warnings. SSL Bailout comes after Government stuck its head in the sand for SIX YEARS after FSC’s warnings. As soon as Bolt’s name was called a mad scramble to save face began.

Unlike FINSAC, SSL’s collapse can’t be blamed on Government policy. Why is Government so anxious to keep it afloat that it creates this illusion to “temporarily” keep staff paid? “Temporarily” until when? Election?

By September 7, Nigel was tripping over his tongue trying to distance Government from the bailout. Suddenly “no taxpayers’ funds” were being used. FID/FSC would “independently fund” SSL costs from proceeds of crime confiscations and surplus previously intended for capital development.

Really? SERIOUSLY? Only “tax revenues” are “taxpayers’ money”? There are no personal/agency-owned funds in Government. All are public funds, collected ON BEHALF OF and spent FOR taxpayers; subject to call from the Consolidated Fund (as Governments have repeatedly done to NHT et al); and, accordingly “taxpayers’ money”. Since Nigel announced on September 1 that HE took the decision to fund SSL expenses, from whom/what would FID/FSC be “independent”? Clearly not Nigel!

Somebody must be high!

Why such intellectually painful gymnastics to create this chimera? What are we not supposed to see?

Peace and Love.

Gordon Robinson is an attorney-at-law. Send feedback to columns@gleanerjm.com