$1.2-b fraud
The Financial Services Commission (FSC) is putting reins on the operation of investment firm Stocks and Securities Limited (SSL) following news of a monumental fraud at the entity that, sources say, amounts to more than $1.2 billion.
Olympian Usain Bolt and a sitting Member of Parliament, whose name is being withheld, are among the more than 30 people whose investments at SSL are believed to be among those fleeced by a wealth advisor who was recently fired by the company.
Jamaica Observer sources, late Thursday, said that SSL would be barred from doing any sales or trading of assets without the permission of the FSC, which is the island’s regulator for non-deposit-taking financial institutions.
“The FSC issued the directions this morning (Thursday) pursuant to section 8(1)(b) of the Financial Services Commission Act. The directions impose strict reporting requirements on the entity and prevent the entity from disposing of any assets. Based on the FSC directions, SSL is barred from issuing funds to clients or accepting new deposits until permitted by the FSC,” said the source.
“The directive was issued on the implications for the solvency of SSL based on a letter sent to FSC on January 10,” added the source.
Minutes after the Observer broke the story on Thursday morning our news desk was told that more than 10 years ago the track icon Bolt deposited some US$8 million in interest bearing accounts in SSL.
The sources said that on the last account statement Bolt’s investment had climbed to at least US$10 million.
However, the wealth advisor, who is now the main focus of the investigation, allegedly siphoned off a sizeable portion of the money before the fraud was discovered.
“She had been with the company for 25 years or more and advertised herself with the slogan, ‘My clients trust me. I earned it’,” said the Observer source who claimed that this could be one of the largest fraud cases at a Jamaican financial institution in history.
“She contracted a lawyer and was interviewed by the police Fraud Squad on Wednesday, at which time she reportedly told them that she took the money to pay medical bills for a family member who needed treatment overseas,” added the source.
Up to late afternoon Thursday the police would not say if the woman, whose name is being withheld, had been charged, but sources said it was likely that charges would be laid against her today.
Early Wednesday, SSL told the Observer that it had called in the police to probe what is believed be a massive case of fraud at the company.
According to SSL in a release, following initial internal investigations it referred the matter to the relevant law enforcement authorities to facilitate a thorough and complete examination of all aspects of the matter.
“Safeguarding client assets is of the utmost importance to SSL. To ensure this, we have implemented several additional internal measures and procedures to secure those assets and detect suspicious activity,” said the company.
“SSL will continue to liaise and cooperate fully with law enforcement throughout this investigation,” the company added.
SSL is Jamaica’s second oldest licensed securities dealer, majority owned by the Croskery family.