KINGSTON, Jamaica— Government Senator Aubyn Hill last Friday shot down his Opposition counterparts’ suggestion that new legislation brought to the Upper House was prompted by the Stocks and Securities Limited (SSL) saga, which has seen the now collapsed investment company embroiled in a $4.7-billion fraud scandal since January 2023.

Responding to the assertions of three Opposition senators during the debate on the Financial Services Commission (Amendment) Act (FSCA) in the Senate, Hill argued that the promulgation of the law started from 2015.

“It was circulated for discussion in 2017 long before SSL happened. So all the pontifications about this being done as a reaction to SSL is entirely incorrect. We brought this to Parliament the first time in 2023. Since then things have happened…making laws take time,” he argued.

He said that the promulgation of the FSCA Act will allow Jamaica to have another regulatory tool to enhance financial sector stability and offer a greater level of protection for financial consumers.

In his contribution to the debate, Opposition Senator Professor Floyd Morris said that in his reading of the legislation, he gleaned that the Bill was prompted from the experience of SSL, and he was happy this piece of legislation has been brought to the fore because it is very debilitating when you have individuals investing in an institution with the hope that they will get good returns in the future, and then they find out there is no money in the financial institution.

“I feel the pain of our legend, our icon Usain Bolt in terms of what has happened to him in his experience with the particular company, and wondered if this piece of legislation was there, in terms of the capacity of the Financial Services Commission (FSC) to interact and intervene more swiftly in some of these institutions, what would have happened? And it might be a little late, but I hope that all the experiences that we have gathered from SSL will trigger further strengthening of the legislative framework to make sure that the monies of our citizens are protected,” said Morris.

Opposition Senator Lambert Brown argued that the Bill is coming after the collapse of a financial institution and is the first such collapse since the 1990s. He further argued that this would not have happened had the legislation come earlier to strengthen the capacity of the FSC.

“These amendments would have prevented it, if they came earlier… These actions have been taken post the collapse of SSL. Maybe if those reports [from the FSC] sent to the minister was read, maybe if we had listened to the board led by Howard Mitchell, what has happened would not have happened to the consumers of financial services which is what FSC is set up to do   – to protect the consumers of financial services,” said Brown.

“We on this side support these belated amendments. So, we support this and we hope that we will never see consumers of financial services suffer in the way that those at SSL under the leadership of this Government,” added Morris.

In the meantime, responding to another issue raised by the senators concerning financial institutions lending monies to individuals without the necessary security/collateral, Hill said that care has to be taken that the industry is not overregulated.

“We must make sure that we have an industry that is not so tightly regulated that it can’t breathe and grow,” he said.

“You can’t dictate to a management as to how it must make a loan. Some loans will be unsecured because the risk is mitigated in another way and some will be secured. So…this act is not taking away that responsibility from managers to manage their institutions well and sometimes mistakes are made by managers because they are human beings and sometimes they are less efficient than they need to be. I have seen enough of that without having to ascribe it to greed or malice,” Hill said.

He added that the FSCA seeks to enhance the regulatory framework for effective and comprehensive group-wide supervision of non-deposit taking groups.

“The amendments to the Financial Services Commission Act, consequential amendments to the Pensions Superannuation Funds and Retirement Schemes, Insurance and Securities acts will further empower the FSC to conduct group-wide supervision and the promulgation of a new set of regulations to govern the FSC’s group-wide supervisory framework,” he said.