FSC says court disputes 'delaying' response to SSL clients
Published:Wednesday | June 14, 2023 | 9:20 AM
The Financial Services Commission (FSC) says its efforts to resolve concerns of clients of the fraud-hit investment firm Stocks and Securities Limited (SSL) have been hampered by court cases in which it is involved.
The regulator's comments come a week after athletics icon Usain Bolt lamented a lack of updates from the authorities and threatened to go to the international media with his experience as a victim of the alleged $3 billion fraud at the private firm.
The FSC noted that since SSL reported the fraud to it on January 10, it has issued directions to block the movement of SSL assets and taken over the company's operations, which it said has allowed it to conduct a "major investigation".
"We are confident that in due course the public will be advised by them on the steps they are taking," the regulator said in a June 12 statement of various law enforcement agencies involved in the probe.
Hampered
But, the FSC explained that the court disputes, including over whether SSL's trustee Caydion Campbell was properly appointed, are impacting its engagement with the thousands of SSL clients left in limbo.
"This has caused a delay in certain actions which the commission would have taken to resolve the concerns of current SSL clients and stakeholders but for the extant matters being litigated before the court," the FSC said, adding that "once there are further updates that can be made without prejudice to law enforcement investigations, the commission commits to making more information available."
Many of the investors at SSL and reported fraud victims are said to be pensioners.
Usain Bolt
“Ambassador Bolt has remained silent and has given time to the investigators, but it doesn't mean that he's not going to commence giving interviews, here and abroad, regarding his experience in this matter,” Linton Gordon, the attorney representing Bolt and his company Welljen Limited, told The Gleaner last week.
He said that Bolt was “extremely concerned” about general silence from officialdom.
Gordon said while some things cannot be published, “surely even the assurance to the depositors and investors as to what is being done ... ought to be done.”
The 36-year-old retired 100m world record holder opened an account at SSL in the name of his holding company Welljen in 2012.
The account's value plummeted from J$2 billion (US$12.7 million) in October 2022 to J$1.8 million or US$12,000 in January when the fraud was uncovered.
He has not recovered any money, his legal team said.
Welljen was not among the 39 clients that former SSL client relationship manager Jean-Ann Panton confessed to defrauding on January 7.
She is the only one charged in the case.
The FSC declared in March that the 50-year-old SSL is insolvent and is seeking the court's permission to be vested with full powers to control SSL and install its own trustee.
That official would be responsible for leading the validation of claims from clients to make payouts, among other things.
Court dispute
SSL's attempt to put in place its trustee on January 16, one day before FSC took temporary management, was halted after the commission obtained a court injunction barring the company or the trustee from doing anything with the assets.
SSL attempted to appeal the April extension of the injunction, but the Court of Appeal ruled against it.
"This court was unlikely to conclude on an appeal that the learned judge erred in granting the interim injunction in favour of the FSC. In short, I found no arguable case for an appeal," Justice Marva McDonald-Bishop said in a written decision handed down on June 9.
The company has argued that the injunction should have been lifted so the validation process would start especially because clients have filed lawsuits against SSL, risking judgments against the entity without portfolios validated.
A court hearing on the validity of SSL's move is scheduled for July.
Later that month, a court will also hear FSC's application to dissolve SSL.
Bolt and another client, Jean Forde, have filed separate lawsuits against SSL, though the two cases are being heard together.
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