OLINT’s boss could face criminal charges in Turks and Caicos Wednesday, 16 July 2008 RJR News understands that Head of OLINT Limited David Smith could face criminal charges in the Turks and Caicos Islands as the country's police prepare to step up their probe into corruption allegations.
According to reports Mr. Smith could be cited for financial crimes.
His house was raided on Monday and computers as well as personal documents were reportedly seized by the Turks and Caicos police.
RJR News spoke with the country's Deputy Inspector of Police Hubert Hughes who refused to divulge details on the probe involving OLINT.
Deputy Inspector Hughes confirmed, however, that the company is under investigation and that Mr. Smith's assets were frozen on Monday.
He said more information will be released Wednesday morning.
Bumpy road ahead for investors
In the meantime, OLINT's clients here in Jamaica are anxiously awaiting word on their status of their investmentsfollowing news that the company's assets have been frozen.
Attorney-at-law Bert Samuels said concerned investors could band together and apply for a court order to get the assets released.
However, he said there could be some challenges since the assets are in another jurisdiction.
"Part of the risk that you run is if you were trading with someone that you know is offshore ... you have to go to those territories to institute your access," he said.
This is the latest in a series of setbacks for OLINT investors who have been trying since January to get back their money.
In June, the company placed restrictions on the frequency with which clients could request withdrawals.
Earlier this week, OLINT said it was buckling under negative publicity but made no mention of when members will be paid.
Domino effect on economy
One financial observer is predicting that the problems facing OLINT will have repercussions for the Jamaican economy.
With reports that Jamaicans have invested more than US$600 million in the scheme Financial Analyst Errol Gregory said any fall-out will have a domino effect.
Mr. Gregory said the debacle facing OLINT has come at a bad time given the recent collapse of Cash Plus and the ongoing global financial crisis.
"There was a greater acceptance that OLINT was involved in a new area of investing, i.e. foreign currency trading, I think it could have a greater shock on the system than Cash Plus even though we know Cash Plus was relatively pervasive," he said.
Expected - Davies
Opposition Spokesman on Finance Dr. Omar Davies said he is not surprised by news that OLINT's assets have been frozen in the Turks and Caicos Islands.
Dr. Davies expressed regret for those investors who will be affected by the fallout but added that the situation underscores the need for the government and opposition to have a unified position on the monitoring of unregulated schemes.
"When these new investment clubs started operating again, I, as then Minister, the Governor of the Central Bank and the former executive Director of the FSC (Financial Services Commission) spoke on it but unfortunately, there was dissent in voices suggesting that we were being anachronistic in dealing with these institutions," he said.
The former Finance Minister added that it is imperative that the country recognize that whenever institutions seek to accept funds from members of the public they must be subject to scrutiny and be willing to have their books examined by the regulatory institutions.
Special court window needed
Commenting on the potential impact on the economy, Dr. Davies said he was unable to determine the extent but called for a time frame to deal with such cases.
"I'm not in a position to comment as I have no idea as to the total funds invested in OLINT. But it's ironic that to date there's not been a definitive ruling from the courts and it speaks to the need for us to have a special window so that matters like these can be handled expeditiously," said Dr. Davies.
Finance Minister Audley Shaw declined to comment on the news when RJR News contacted him at the House of Representatives on Tuesday.
According to reports Mr. Smith could be cited for financial crimes.
His house was raided on Monday and computers as well as personal documents were reportedly seized by the Turks and Caicos police.
RJR News spoke with the country's Deputy Inspector of Police Hubert Hughes who refused to divulge details on the probe involving OLINT.
Deputy Inspector Hughes confirmed, however, that the company is under investigation and that Mr. Smith's assets were frozen on Monday.
He said more information will be released Wednesday morning.
Bumpy road ahead for investors
In the meantime, OLINT's clients here in Jamaica are anxiously awaiting word on their status of their investmentsfollowing news that the company's assets have been frozen.
Attorney-at-law Bert Samuels said concerned investors could band together and apply for a court order to get the assets released.
However, he said there could be some challenges since the assets are in another jurisdiction.
"Part of the risk that you run is if you were trading with someone that you know is offshore ... you have to go to those territories to institute your access," he said.
This is the latest in a series of setbacks for OLINT investors who have been trying since January to get back their money.
In June, the company placed restrictions on the frequency with which clients could request withdrawals.
Earlier this week, OLINT said it was buckling under negative publicity but made no mention of when members will be paid.
Domino effect on economy
One financial observer is predicting that the problems facing OLINT will have repercussions for the Jamaican economy.
With reports that Jamaicans have invested more than US$600 million in the scheme Financial Analyst Errol Gregory said any fall-out will have a domino effect.
Mr. Gregory said the debacle facing OLINT has come at a bad time given the recent collapse of Cash Plus and the ongoing global financial crisis.
"There was a greater acceptance that OLINT was involved in a new area of investing, i.e. foreign currency trading, I think it could have a greater shock on the system than Cash Plus even though we know Cash Plus was relatively pervasive," he said.
Expected - Davies
Opposition Spokesman on Finance Dr. Omar Davies said he is not surprised by news that OLINT's assets have been frozen in the Turks and Caicos Islands.
Dr. Davies expressed regret for those investors who will be affected by the fallout but added that the situation underscores the need for the government and opposition to have a unified position on the monitoring of unregulated schemes.
"When these new investment clubs started operating again, I, as then Minister, the Governor of the Central Bank and the former executive Director of the FSC (Financial Services Commission) spoke on it but unfortunately, there was dissent in voices suggesting that we were being anachronistic in dealing with these institutions," he said.
The former Finance Minister added that it is imperative that the country recognize that whenever institutions seek to accept funds from members of the public they must be subject to scrutiny and be willing to have their books examined by the regulatory institutions.
Special court window needed
Commenting on the potential impact on the economy, Dr. Davies said he was unable to determine the extent but called for a time frame to deal with such cases.
"I'm not in a position to comment as I have no idea as to the total funds invested in OLINT. But it's ironic that to date there's not been a definitive ruling from the courts and it speaks to the need for us to have a special window so that matters like these can be handled expeditiously," said Dr. Davies.
Finance Minister Audley Shaw declined to comment on the news when RJR News contacted him at the House of Representatives on Tuesday.
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