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• In January 2007, a letter to the editor from a junior government minister described the FSC and Financial Investigation Division’s raid on OLINT as a “Gestapo-like invasion” which was a “vulgar abuse of state power.” It argued that OLINT was a boon to the Jamaican economy, and that rather than expatriating capital, OLINT’s payments to club members were generating foreign exchange reflows of $7 million weekly during November–December 2006.
• In November 2007, a prominent attorney wrote that the financial community was trying to sabotage Cash Plus’ obvious success.
• In December 2007, several influential church leaders declared that the country would lose if OLINT and LewFam were forced to close, and that individuals should be free to invest once adequate information is given.
Against this backdrop, there were some public manifestations of support from the government for the FSC. In January 2007, finance minister Omar Davies warned that people who put money in the schemes did so without the protection of the government.
According to a February 2007 FSC press release, the junior minister’s comments described above were condemned by the Cabinet as not expressing the position of the government. Later in 2007, the tax administration indicated that all income, including illegal income from UIS, was taxable. Further support from the government came in January 2008, when the Cabinet endorsed the FSC’s actions against schemes and indicated that the FSC would continue to act against them.
A leading newspaper stated in April 2008 that a review of its coverage of Cash Plus found that eight of 55 stories were promotion pieces, nine of 55 would have failed its current code of ethics, and that it had inaccurately reported several major real estate purchases by Cash Plus which did not actually take place.
Size and impact
It appears that the schemes (Cash Plus and OLINT in particular) grew dramatically after the FSC’s intervention on OLINT and LewFam in late 2006. It seems that the intervention served to advertise the schemes, while there were no immediate follow-up actions charging them or their perpetrators with any crime. Apparently, the court’s decision to prohibit OLINT from accepting new members while not preventing additional investments was followed by a proliferation of new schemes that attracted new investors and channelled their funds into OLINT through the accounts of existing OLINT members. According to the CaPRI study, a November 2007 survey of 400 investors in UIS found that most had invested in the 12 months preceding the survey.
Cash Plus took in investor funds of J$22 billion ($260 million or 2% of GDP) during 2004–07 from 35–45 thousand investors, according to a May 2008 interim report by its receiver. During August 2006–May 2007, two entities associated with David Smith, OLINT TCI and TCI FX Traders, deposited $100 million into its accounts in i-Trade FX LLC.20 For other schemes, there is no reliable information, as they do not provide audited or unaudited financial statements or a list of assets. The January 2008 CaPRI study estimated that Jamaican UIS have taken in investments of 12.5-25% of GDP. The results of the study’s survey of 400 investors suggest that around 50,000 households invested in these schemes, with a typical investment of around J$200,000 to J$300,000 (about $2,800-$4,100). Most of the investors were middle class, which the study argued would limit the potential for social unrest if the schemes collapsed.
http://businessifc.com/articles/Ponz...-Caribbean.htm
• In November 2007, a prominent attorney wrote that the financial community was trying to sabotage Cash Plus’ obvious success.
• In December 2007, several influential church leaders declared that the country would lose if OLINT and LewFam were forced to close, and that individuals should be free to invest once adequate information is given.
Against this backdrop, there were some public manifestations of support from the government for the FSC. In January 2007, finance minister Omar Davies warned that people who put money in the schemes did so without the protection of the government.
According to a February 2007 FSC press release, the junior minister’s comments described above were condemned by the Cabinet as not expressing the position of the government. Later in 2007, the tax administration indicated that all income, including illegal income from UIS, was taxable. Further support from the government came in January 2008, when the Cabinet endorsed the FSC’s actions against schemes and indicated that the FSC would continue to act against them.
A leading newspaper stated in April 2008 that a review of its coverage of Cash Plus found that eight of 55 stories were promotion pieces, nine of 55 would have failed its current code of ethics, and that it had inaccurately reported several major real estate purchases by Cash Plus which did not actually take place.
Size and impact
It appears that the schemes (Cash Plus and OLINT in particular) grew dramatically after the FSC’s intervention on OLINT and LewFam in late 2006. It seems that the intervention served to advertise the schemes, while there were no immediate follow-up actions charging them or their perpetrators with any crime. Apparently, the court’s decision to prohibit OLINT from accepting new members while not preventing additional investments was followed by a proliferation of new schemes that attracted new investors and channelled their funds into OLINT through the accounts of existing OLINT members. According to the CaPRI study, a November 2007 survey of 400 investors in UIS found that most had invested in the 12 months preceding the survey.
Cash Plus took in investor funds of J$22 billion ($260 million or 2% of GDP) during 2004–07 from 35–45 thousand investors, according to a May 2008 interim report by its receiver. During August 2006–May 2007, two entities associated with David Smith, OLINT TCI and TCI FX Traders, deposited $100 million into its accounts in i-Trade FX LLC.20 For other schemes, there is no reliable information, as they do not provide audited or unaudited financial statements or a list of assets. The January 2008 CaPRI study estimated that Jamaican UIS have taken in investments of 12.5-25% of GDP. The results of the study’s survey of 400 investors suggest that around 50,000 households invested in these schemes, with a typical investment of around J$200,000 to J$300,000 (about $2,800-$4,100). Most of the investors were middle class, which the study argued would limit the potential for social unrest if the schemes collapsed.
http://businessifc.com/articles/Ponz...-Caribbean.htm
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