Justice David Batts will rule on Friday on whether the Financial Services Commission (FSC) should retain control of fraud hit Stocks & Securities Limited (SSL) or if Caydion Campbell should take over the reigns as the trustee of the firm.

The case, which began on February 26 and ended on May 10, has seen the FSC fighting to retain control of the firm which it intends to wind up under temporary manager Kenneth Tomlinson.

However, this route may hit a speed bump if the judge rules that Campbell should be confirmed as the trustee and Tomlinson be dislodged from his role. Both the FSC and Campbell intend to wind up the firm under a court-supervised process.

SSL, a licensed securities dealer, has been embroiled in a saga surrounding alleged fraudulent events that took place over several years.

The FSC has been managing the firm through temporary manager Business Recovery Services Limited since January 17, 2023.

But Campbell was appointed by SSL’s former board of directors as the trustee of the firm to carry out a member’s voluntary wind-up on January 16, 2023.

Campbell has been unable to carry out any of his functions since the FSC intervened and has had to remain on the sidelines.

Lisa White, an attorney from the Attorney General’s Chamber, presiding over the case on behalf of the FSC, presented her case on several points which included an argument that the move by SSL to install Campbell as trustee was a breach of the enhanced directions which were implemented days after SSL reported an event of fraud.

The argument was also predicated on the declaration of solvency being invalid which would impact the ability for there to be member’s voluntary wind-up.

This was supported by evidence from the FSC, a solvency report prepared by PricewaterhouseCoopers Trinidad & Tobago, Tomlinson’s own testimony and several other forms of evidence.

However, the lawyers spent the entire evening session on April 26 and an hour on May 10, during closing arguments, discussing whether SSL was prevented from exercising its right under the Companies Act to seek a member’s voluntary wind-up.

This was one of the numerous times where the presiding judge debated the attorney on certain events during the trial, including amended submissions.

“As you will see, My Lord, from the submissions I intend to make, when one looks at the FSC Act, it is my respectful conclusion that it should be construed or interpreted to show that temporary management and winding up are alternatives and are not intended to run simultaneously,” said Carlene Larmond, KC, the independent court-appointed attorney for SSL.

Larmond, in her one-hour closing argument, mentioned a 2015 Singapore case and another United Kingdom case with respect to the Companies Act and Insolvency Act provisions. These points were used to support the argument about the inability to reverse the decision to wind up or appointment of trustees.

“Despite the fact that the court has received minutes that there are no directors now, there are still members. There is no evidence that the membership of the company has changed. The company, milord, although not operating, still has stakeholders who made a decision in keeping with their rights, whose rights can be adequately supervised by the court, and whose rights were reflected in their decision to appoint Mr Campbell,” said Caroline Hay, KC, attorney for Campbell, in response to Batts’ query on why her client should be the trustee over Tomlinson.

Hay spent nearly 30 minutes going through established facts in the case, different provisions of law and decided cases on why the FSC can not remove the trustee. The closing segment of the May 10 session was spent discussing the payment of fees to Larmond whose costs have been equally borne by both parties.

With numerous lawsuits being filed against the firm over the last year, on October 2, 2023, Batts stayed all other court cases involving SSL until control of the firm could be resolved.

With the judgment to be delivered tomorrow, the floodgates are set to be opened for the numerous claims to be filed by several parties and other cases which were ongoing prior to the order.

The most prolific cases are the WellJen Limited and Jean Elizabeth Forde matters which are being heard together.

Those claims are against former SSL manager Jean-Ann Panton and several other former SSL directors and executives.

That issues had a virtual case management conference on Wednesday for one hour before Justice Cresencia Brown Beckford.

Panton, who is the only person so far charged in the matter, should have returned to the Supreme Court on Monday to continue the 22-count indictment on several charges relating to her role at SSL over a decade.

She has been remanded since February 2023 following her arrest where it was alleged that she had compromised the account of several clients, including that of WellJen, which has been detailed in court proceedings.

WellJen is a holding company connected to sprint sensation Usain Bolt who has refrained from commenting on the matter.

It was initially stated that US$12.76 million was missing from WellJen’s account, but court proceedings have noted that US$6.1 million, which was deposited with SSL, might have never been invested.

The Office of the Director of Public Prosecutions (ODPP) has yet to make a ruling on whether additional parties are to be charged in the SSL fraud case due to outstanding documents to be received from the Financial Investigations Division (FID).

The ODPP has indicated that more than 3,000 pages of documentary material has been received so far from the FID in what has been a wide-ranging case.

The Government has paid UK-firm Kroll & Associates US$1.20 million for a forensic audit of SSL’s operations between 2010 — 2023. The details of this audit are yet to be revealed.

The last major SSL update by Finance Minister Dr Nigel Clarke was that 1,230 SSL client accounts had transferred $15.37 billion of local equity and fixed income securities to other brokers as requested by clients. In addition, $665 million in cash was transferred to 338 clients up to April 16.

The remaining $7.6 billion worth of financial securities are to be transferred to a trust company to be held in custody for the remaining clients yet to claim their assets associated with the firm.