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Finsac Enquiry
My bank bungled and Finsac took hard line, says businessman
BY PATRICK FOSTER Observer staff reporter fosterp@jamaicaobserver.com
Thursday, April 28, 2011
BUSINESSMAN Aubrey Smith yesterday charged that bungling by his bank and a hard-line approach by the Financial Sector Adjustment Company (Finsac) resulted in his properties being seized and put up for sale, although he had repaid his loans.
Smith, the former owner of Beautifit Limited, was giving testimony at the Finsac Enquiry being held at the Pegasus hotel in New Kingston.
According to the businessman, there was "a pattern of errors" in the administration of his account at Century National Bank (CNB) where, in 1988, he had taken a $1-million line of credit to expand his business. "I put it at best that they were errors," he commented.
Properties at King Street and Love Lane in downtown Kingston were used as security.
Yesterday, Smith presented evidence to the commission, which he claimed proved that his loans were paid off at the time when Century National was taken over by Finsac.
Smith told the enquiry that by March 1992, repayments on his overdraft were cleared and his account had a credit balance of approximately $407,000, and he presented documents to show that he had overpaid approximately $742,000 to CNB on the loan.
Smith also said that an auditor's report conducted in 1997 showed that in March 1992 CNB actually owed him approximately $1.1 million.
However, CNB at the time claimed approximately $2.4 million in outstanding amounts.
"My indebtedness was fully satisfied by 1993," he told Finsac enquiry Commissioners Worrick Bogle and Charles Ross.
Smith added that discussions were held with the chairman of CNB and an agreement arrived at that there was in fact an error with his account.
"To the best of my recollection no further claim was made by CNB and court action was not taken as threatened until CNB was taken over (by Finsac)," said Smith, who noted that the discrepancies were brought to the attention of Finsac after Century National was acquired.
He told the enquiry that during 1999 several discussions took place and correspondence was exchanged with Finsac to point out the Century Bank error.
"However, Finsac persisted in its claim against Beautifit and me," said the businessman, who also owned Caribbean Chalks and Art Products, a company set up to manufacture and export chalk and crayons.
He testified that in 2003 he was served with notification that Finsac had sold the "alleged debt" to Jamaica Redevelopment Foundation (JRF).
Smith's current debt is unclear but he stated that JRF, up until recently, had been "vigorously advertising Beautifit Limited's properties for sale under the powers of sale contained in a mortgage".
Attempts by Beautifit to free its properties and prevent the sale by way of court proceedings have not been successful, said Smith, who insisted that his properties were seized and put up for sale although he had fully paid off his loans.
Read more: http://www.jamaicaobserver.com/finsa...#ixzz1ML60McBs
My bank bungled and Finsac took hard line, says businessman
BY PATRICK FOSTER Observer staff reporter fosterp@jamaicaobserver.com
Thursday, April 28, 2011
BUSINESSMAN Aubrey Smith yesterday charged that bungling by his bank and a hard-line approach by the Financial Sector Adjustment Company (Finsac) resulted in his properties being seized and put up for sale, although he had repaid his loans.
Smith, the former owner of Beautifit Limited, was giving testimony at the Finsac Enquiry being held at the Pegasus hotel in New Kingston.
According to the businessman, there was "a pattern of errors" in the administration of his account at Century National Bank (CNB) where, in 1988, he had taken a $1-million line of credit to expand his business. "I put it at best that they were errors," he commented.
Properties at King Street and Love Lane in downtown Kingston were used as security.
Yesterday, Smith presented evidence to the commission, which he claimed proved that his loans were paid off at the time when Century National was taken over by Finsac.
Smith told the enquiry that by March 1992, repayments on his overdraft were cleared and his account had a credit balance of approximately $407,000, and he presented documents to show that he had overpaid approximately $742,000 to CNB on the loan.
Smith also said that an auditor's report conducted in 1997 showed that in March 1992 CNB actually owed him approximately $1.1 million.
However, CNB at the time claimed approximately $2.4 million in outstanding amounts.
"My indebtedness was fully satisfied by 1993," he told Finsac enquiry Commissioners Worrick Bogle and Charles Ross.
Smith added that discussions were held with the chairman of CNB and an agreement arrived at that there was in fact an error with his account.
"To the best of my recollection no further claim was made by CNB and court action was not taken as threatened until CNB was taken over (by Finsac)," said Smith, who noted that the discrepancies were brought to the attention of Finsac after Century National was acquired.
He told the enquiry that during 1999 several discussions took place and correspondence was exchanged with Finsac to point out the Century Bank error.
"However, Finsac persisted in its claim against Beautifit and me," said the businessman, who also owned Caribbean Chalks and Art Products, a company set up to manufacture and export chalk and crayons.
He testified that in 2003 he was served with notification that Finsac had sold the "alleged debt" to Jamaica Redevelopment Foundation (JRF).
Smith's current debt is unclear but he stated that JRF, up until recently, had been "vigorously advertising Beautifit Limited's properties for sale under the powers of sale contained in a mortgage".
Attempts by Beautifit to free its properties and prevent the sale by way of court proceedings have not been successful, said Smith, who insisted that his properties were seized and put up for sale although he had fully paid off his loans.
Read more: http://www.jamaicaobserver.com/finsa...#ixzz1ML60McBs
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