MEMBERS of the board and management of the embattled investment firm Stocks and Securities Limited (SSL) have moved to distance themselves from the multi-billion-dollar fraud at the company while defending the integrity of the majority of its staff.
The leadership of the company also hinted that its clients who were defrauded did not take the available precautions to protect their investments over the more than 10 years during which their accounts were hit.
"SSL has an online system that all clients can use to track their portfolio performance. In fact, this system is considered one of the best in the world and accurately shows clients' portfolio holdings. Unfortunately, it is common to the affected clients that they did not use the online system, but rather, relied on statements generated by the former employee, which undoubtedly was the likely reason they were targeted," said the company on Wednesday, in its first extensive comment since news of the alleged fraud broke some four weeks ago.
The board and management, in the release, said it is working to facilitate the law enforcement agencies which are probing the matter, and has made no action to frustrate the probe.
"The management of SSL continues to go to work every single day to support the Financial Services Commission (FSC), the Financial Investigations Division (FID), and Fraud Squad in their work. These staff members are mindful of the attacks and assertions which have been made on them from various quarters, while the former employee who confessed remains at home. This is extremely demoralising for those who continue to work hard to try to ensure justice is done," said the SSL in a release on Wednesday.
"Jamaica has a highly reputable financial market, with a sound regulatory framework operating at international standards. This remains so despite the recent spate of cases of fraud at various financial institutions. A few bad apples, who do what fraudsters do – find ways to beat the system – should not cast doubt and suspicion on the many thousands who toil daily to preserve the integrity of the sector. Justice should be the objective for all affected clients, famous or unknown. That is our aim and we will continue to support that objective in every way possible," added the SSL.
According to the company, on Tuesday, January 10, 2023, it notified the FSC of the discovery of apparent fraud by a former employee and of the immediate steps being taken to address the matter.
The company said the next day, January 11, a representative of track and field icon Usain Bolt visited its offices and indicated that the employee had turned up at their offices to confess that she had falsified statements provided to them, had stolen money from them and other SSL clients, and was requesting help from his management team to repay the clients whose funds she had stolen.
It is believed that the reasons she did not initially confess to defrauding this particular client are (1) she was aware of the tremendous spotlight which the Bolt name would bring to bear on her activities, and (2) amazingly, she, for whatever reason, and despite having admitted to the Bolt management team that … Usain Bolt was among her victims, apparently still believed that she could borrow the money from the Bolt management group to repay the other SSL clients," the company said in its release.
SSL also rejected claims that its leadership was headed to court to wind up the company before they were stopped in their tracks by the Government who went to court to get an injunction to stop this move.
The company said the appointment of a trustee was notified to the FSC on January 12 and discussions were ongoing.
"SSL appointed Mr Caydion Campbell of Phoenix Restructuring, Advisory and Insolvency Services Enterprise (PRAISE) as trustee under the Companies Act of Jamaica effective Monday, January 16, 2023.
"It was the intention of the directors that their powers and authority be vested in the trustee and that the affairs of SSL would be under his control. The further intention was that the trustee and his team would conduct an Independent Business Review ("IBR") and other investigations into SSL's operations to determine, among other things, its financial state of affairs as of the date 16 January 2023.
"The purpose of the appointment was not, we repeat, not to wind up the company. Among Mr Campbell's key objectives were intended to be to ensure that all necessary conservatory measures were in place over the assets of SSL, as well as to ensure compliance with the enhanced governance protocols as directed by the FSC. It was intended that he would also use the results of the IBR to explore the restructuring and reorganisation options that were available to preserve and enhance the value of the business, operations, and undertakings of SSL for the benefit of all its stakeholders.
"Once agreed with the FSC, a resolution plan would have been developed and implemented," said the SSL.
It added: "SSL board and management does not know how or where the funds stolen from clients of SSL were used. Client funds and Proprietary Funds (funds for SSL's operations) are entirely separate, with separate departments and controls to ensure they are not mixed."
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