David Smith

In March of last year I received a call to meet a good friend at New Kingston Shopping Mall as quickly as I could. This request piqued my interest because he did not specify a purpose or give any indication as to why we were meeting in the centre of town. To be honest, I was a little unnerved and I hoped that no misfortune had befallen my friend. You see, he had turned a corner in his life and all seemed to be well with him.

I got to the shop where we were to rendezvous and found police in paramilitary get-up with FID written across their backs. They were earnestly examining the contents of one of those shopping units on the upper level, avidly searching for something at the time I knew not what.

My friend, always affable, greeted me before declaring, "They are trying to make him a criminal and all he is doing is making people the best returns in Jamaica. What he is doing is not illegal!"

I watched the cops going about their work unsure as to what my friend was going on about. Pretty soon the scene attracted a crowd of people, many of whom I recognised. Many told me that they were anxious to know whether their money was safe. The scene looked like a run on a bank and reminded me of the Polly Peck scandal in London.

It transpired that these people were members of an investment club headed by "a financial genius that could make returns of no less than 10 per cent a month.
"That's impossible in Jamaica unless some sort of nefarious activity is involved. Are you sure this is not a pyramid scheme? What have you got yourself into this time? I keep telling you there is no quick route to wealth creation, a man has to build a life rather like building an innings at the crease," I said not wanting to sound too dismissive.

"Meet David, he's a FX trader and heads a company called OLINT. These FID guys are saying it has come to their attention that he has breached the Securities Act."
Just then a languid walking guy in his 30s, twinkling eyes and with an easy-going way about him doffing a Ralph Lauren baseball cap was introduced to me.

"Hi, I'm David Smith," he said and proffered a hand. He then sought to explain what was happening and said he feared he might well be arrested and his business destroyed.
I had heard of George Sorros and Mike Lee Chin's mentor Warren Buffett making it big in FX trading but this fella seemed not to belong in that exalted company. He looked like an around-the-way guy. Still, I felt a pang of sympathy for him, as he had to stand and watch the FID officers go through his paperwork and dismantle his computer.

The following day, I didn't give the incident too much thought until my friend rang me and said that David was suing the Financial Services Commission (CFSC) for J$300 million for wrongful intrusion. It was from that moment that OLINT became the financial story of the year.

Players in the sector and 'financial analysts' said throughout last year that it was impossible to make sustainable returns of 10 per cent a month and that it would all end in tears by May.
The demographic nature of this investment club is an eclectic mix yet a microcosm of Jamaican society. Uptowners with dollars to spare and ordinary church- going folk living on a prayer. All in all, people with an appetite for risk and who have an unwavering faith in this young man.
FX trading is not illegal; corporations and financial institutions have made impressive returns going that route. David Smith is by all accounts a good trader having honed his skills at JMMB as a currency trader.

While the Jamaican financial sector promises returns of between 3 to 5 per cent a year, he has for the better part of 2006 delivered returns in excess of 10 per cent a month in a macro economic environment which is seeing declining interest rates, falling inflation and greater consolidation of the financial sector.

He has single-handedly succeeded in getting Jamaican investors to demand greater returns and sated their appetite for risk. If you had invested US$10,000 at the beginning of 2006 you would have made back your principal by January 2007. Now that's pretty enticing and lends a new definition to wealth creation.

Both Mike Lee Chin and Bill Clarke seem to be on the same page - this time - in dismissing Smith. They have said that investors will get burnt. But if you are offering me 4 per cent a year and this guy is making my friends 10 per cent a month, each and every month, what would you do? David Smith now has close to US$400 million under management despite the FSC putting the block on Jamaicans investing with OLINT at least until March of this year. David Smith is undoubtedly the success story of 2006. Never mind that his operations may not be sustainable - it certainly was in 2006.

Jamaican investment instruments tend to be very unsophisticated- vanilla-flavoured if you like. The days of making it on repos are gone and Smith has heralded a new form of making returns. FX trading did not feature in the lexicon of Jamaican investors. It does now. A new dynamic has been added to the financial sector which allows the small, unsophisticated investor - once aware of the risks - to make handsome returns. There is a sense of well-being when ordinary folk tell of putting down on a house, sending their children to college or buying a car from the proceeds of their investments with OLINT. The ability to enhance lives when it was not possible before can make a life less ordinary. No wonder all those church folk who placed their cash with Smith love him. David Smith does not change water into wine but like Jesus who incurred the animosity, and suspicion of the Pharisees and Sadducees he has been scorned by the financial sector's traditionalists while helping to create miracles of good fortune for the small investor and big investor alike underscoring that is an unassuming Jamaican young man tucked away in Turks & Caicos who is literally good at his trade. His name is David Smith and in 2006 he was an iconoclast who had his place in the sun.

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