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Olint TCI investors could be left penniless
By Gemma Handy
Friday, June 05, 2009
THE WINDING-UP of a Turks & Caicos Islands firm at the centre of a multi-million dollar fraud is set to begin on Tuesday with the appointment of a liquidator.
But islanders who ploughed their life savings into foreign currency exchange firm Olint TCI could be left penniless as there are scant funds to return their investments.
Company boss David Smith was arrested on suspicion of money laundering in July last year.
The Jamaican businessman's Providenciales home was raided and assets from his two Island-based firms frozen amid investigations by the country's Financial Crime Unit.
He will appear before court on August 5 to face a string of fraud and theft-related charges.
If found guilty, the case would represent one of the biggest scams the region has ever seen.
Justice Richard Williams revealed in the Supreme Court this week that he had personally received "streams of correspondence" from anxious local investors.
"It is very important to get a liquidator appointed so he can write to them to let them know what's going on.
"I feel terrible for them, it's sad for all the people."
He said many of the letters detailed distressing personal situations and health conditions exacerbated by clients being unable to access their money.
Mr Williams also said the amount of cash the Attorney General says is available to repay creditors falls short of the quantity being sought.
"The amounts that the AG disclosed to me, there are not the amounts in that account to meet the amounts the creditors say they are owed."
Smith denies operating a Ponzi scheme, a fraudulent investment operation that pays returns to investors from their own money or that paid by subsequent investors rather than from any actual profit earned.
Currently held on US$1 million bail, he is charged with two counts of uttering forged documents, four counts of false accounting and two counts of theft.
In January, the High Court refused to lift the freeze order on Smith's assets. He had wanted them released to honour a promise to make payments owed to clients attracted by Olint's 10 per cent per month return on investments.
A number of lawsuits are already in progress in a bid to claw back some of the cash. The value of claims in the TCI alone tops US$15 million. Several internet sources place the book value of the company at almost US$1 billion with US$350 million in deposits.
Oliver Smith, representing both the firm and its two directors, Smith and wife Tracy, is opposing the appointment of the liquidator put forward by the Attorney General on the grounds that he performed an audit in August 2008 and may be called as a witness.
Justice Williams subsequently adjourned the case until June 2 to allow attorneys time to prepare their cases.
A wind-up order was previously granted on the defendant's other TCI-based firm, FX Traders.
Investigations were launched into the activities of both companies last year. Warrants were executed on Olint TCI's office along with Smith's Chalk Sound home, during which a number of computers were seized.
Olint was originally started by Smith in Jamaica before being closed down by the Financial Services Commission (FSC) in March 2006. He launched operations in the TCI shortly afterwards.
TCI FX Traders was licensed by the TCI's FSC and set up office 12 months ago in Leeward Highway.
Smith was described by former Premier Michael Misick in December 2007 as a "model citizen" who had made an enormous contribution to the local economy.
Speaking in Jamaica following Olint's establishment of a foundation to help children with special needs in that country, Mr Misick said: "Good people matter and I am happy that this foundation has been established.
"We appreciate the efforts of David and Tracy and how greatly they have contributed to the economy of Turks & Caicos in the short time they have been there.
"Jamaica's misfortune is indeed the good fortune of Turks & Caicos having gained these model citizens."
By Gemma Handy
Friday, June 05, 2009
THE WINDING-UP of a Turks & Caicos Islands firm at the centre of a multi-million dollar fraud is set to begin on Tuesday with the appointment of a liquidator.
But islanders who ploughed their life savings into foreign currency exchange firm Olint TCI could be left penniless as there are scant funds to return their investments.
Company boss David Smith was arrested on suspicion of money laundering in July last year.
The Jamaican businessman's Providenciales home was raided and assets from his two Island-based firms frozen amid investigations by the country's Financial Crime Unit.
He will appear before court on August 5 to face a string of fraud and theft-related charges.
If found guilty, the case would represent one of the biggest scams the region has ever seen.
Justice Richard Williams revealed in the Supreme Court this week that he had personally received "streams of correspondence" from anxious local investors.
"It is very important to get a liquidator appointed so he can write to them to let them know what's going on.
"I feel terrible for them, it's sad for all the people."
He said many of the letters detailed distressing personal situations and health conditions exacerbated by clients being unable to access their money.
Mr Williams also said the amount of cash the Attorney General says is available to repay creditors falls short of the quantity being sought.
"The amounts that the AG disclosed to me, there are not the amounts in that account to meet the amounts the creditors say they are owed."
Smith denies operating a Ponzi scheme, a fraudulent investment operation that pays returns to investors from their own money or that paid by subsequent investors rather than from any actual profit earned.
Currently held on US$1 million bail, he is charged with two counts of uttering forged documents, four counts of false accounting and two counts of theft.
In January, the High Court refused to lift the freeze order on Smith's assets. He had wanted them released to honour a promise to make payments owed to clients attracted by Olint's 10 per cent per month return on investments.
A number of lawsuits are already in progress in a bid to claw back some of the cash. The value of claims in the TCI alone tops US$15 million. Several internet sources place the book value of the company at almost US$1 billion with US$350 million in deposits.
Oliver Smith, representing both the firm and its two directors, Smith and wife Tracy, is opposing the appointment of the liquidator put forward by the Attorney General on the grounds that he performed an audit in August 2008 and may be called as a witness.
Justice Williams subsequently adjourned the case until June 2 to allow attorneys time to prepare their cases.
A wind-up order was previously granted on the defendant's other TCI-based firm, FX Traders.
Investigations were launched into the activities of both companies last year. Warrants were executed on Olint TCI's office along with Smith's Chalk Sound home, during which a number of computers were seized.
Olint was originally started by Smith in Jamaica before being closed down by the Financial Services Commission (FSC) in March 2006. He launched operations in the TCI shortly afterwards.
TCI FX Traders was licensed by the TCI's FSC and set up office 12 months ago in Leeward Highway.
Smith was described by former Premier Michael Misick in December 2007 as a "model citizen" who had made an enormous contribution to the local economy.
Speaking in Jamaica following Olint's establishment of a foundation to help children with special needs in that country, Mr Misick said: "Good people matter and I am happy that this foundation has been established.
"We appreciate the efforts of David and Tracy and how greatly they have contributed to the economy of Turks & Caicos in the short time they have been there.
"Jamaica's misfortune is indeed the good fortune of Turks & Caicos having gained these model citizens."
