The Jamaican government has announced that it is no longer necessary for them to provide financial support to fraud-hit investment company Stocks and Securities Limited (SSL).
In a press release on Tuesday, Finance Minister Dr Nigel Clarke said an insurance claim made by the temporary manager of the company in April of this year to insurers in England, has now been settled. SSL received the insurance payout of US$1 million on Thursday, September 7th, enabling it to settle the remainder of its August staff salary bill last week Monday, September 11.
“As such, with this new development, no taxpayer money, no Government of Jamaica resources, no public funds have, or will be, used to support SSL in the payment of any of its employees or any other of its expenses,” Clarke said.
Earlier this month, it was announced that the government would foot the $15 million salary bill for 22-member staff at the company to ensure SSL’s operations remain undisrupted amid the probe into the multimillion-dollar fraud scheme at the company.
At the start of this year, a massive fraud was detected at the company, with the accounts of dozens of clients, including Usain Bolt, depleted.
Since then, investigators have uncovered that the number of affected accounts is almost double what was initially reported. The island’s Financial Investigations Division announced that its probe into the fraudulent activities at SSL revealed that there are now approximately 70 affected accounts compared to just over 40 reported in the initial phase of the investigation.
Clients to regain account access; SSL to cut staff
Beginning Friday, September 22, SSL will also begin the process of transferring client securities to other security dealers selected by clients, and any Jamaican cash balances in client accounts will be transferred to banks specified by clients.
“While we expect up to one-third of J$ client balances to be transferred within days, the entire process could take up to six weeks to be completed, given the volume of client accounts,” noted Minister Clarke.
However, the transfer of US$ securities owned by SSL clients will involve collaboration with US-based regulators and US-based investment houses which will therefore take more time.
The company also plans to reduce its staff size from 22 to 8 people in the next few weeks.
“Given the progress in the investigation recently announced by the Financial Investigation Division, and the expected winding down of SSL’s off-balance sheet book of business, SSL’s staff complement is projected to decline from 22 persons currently to no more than 8 persons by the end of November,” the release read.
