FSC and Cash Plus

FSC says legal action not ruled out against Cash Plus
published: Friday | May 18, 2007

The Financial Services Commission (FSC) has confirmed it is in dialogue with Cash Plus, an investment entity which it said was in breach of the country’s financial regulations, but advised Wednesday that it had not ruled out legal action against the company.

FSC executive director Bryan Wynter said his agency could present files to the Director of Public Prosecutions to take action at anytime.

Wynter did not disclose the nature of the talks it was having with Cash Plus, but said it would not prevent the regulator from placing the company before the court, if necessary.

Cash Plus lawyer Harold Brady redirected a request for comment to attorney K.D. Knight. Knight did not return our call up to press time.

The regulator has suggested in the past that the scheme which Cash Plus operates, which gives returns of up to 10 per cent per month on investments, is tantamount to investment advice and trading.

The company, run by self-described ex-mortgage banker, Carlos Hill, has conferred that it borrows from clients and pays them a return on those funds. Cash Plus is also a heavy investor in real estate, shipping, hotels, and a range of sectors.

Wynter said his agency had not up to this point issued a cease and desist order on the management. He also told journalists that initiating a lawsuit would prove difficult as information on the company and its principals were difficult to obtain.

The FSC in the past has denied approval for a security Cash Plus had attempted to register for trading. Neither the regulator nor Cash Plus would give details on the security and the reasons for the refusal.

The FSC boss maintained Wednesday, however, that he was more interested in having Cash Plus comply with securities legislation than in initiating legal proceedings.

Two weeks ago, the FSC issued an advisory warning that Cash Plus was not a licensed investment dealer and as such was not authorised to offer investment products to the public.

It was the first notice issued about the company, though Wynter has warned in comments to the media that the public should be wary of such high-risk high-return schemes.

But Cash Plus fired back, dismissing the FSC’s claim and threatened legal action against the regulatory agency.

The company said that inthe interest of transparency, it was heading to the Supreme Court to obtain a declaration on its status.

john.myers@gleanerjm.com

http://www.jamaica-gleaner.com/gleaner/20070518/business/business10.html

Jitters about late payment of Cash Plus allayed – Company blames the banks, claims slow processing

Jitters about late payment of Cash Plus allayed – Company blames the banks, claims slow processing
published: Friday | November 16, 2007

Cash Plus investors, or at least some of the group whose returns are remitted to their bank accounts, are experiencing delays in monthly payments.

But on Wednesday, a company executive said the lag was linked to tardiness by the banks and not related to any cash flow difficulties by the investment club.

“Because of the clearing periods in the banks, the payments are not facilitated quickly,” said Cash Plus vice-president Chris Golbourne.

“There is this wait period.”

The scheme’s club members, however, say that this was not always the case.

The Financial Gleaner on November 9 visited the company’s Premier Plaza office which was opened October 19 as a dedicated office for disbursements and found more than two dozen irritated investors whose payments were late.

Routinely delayed

Individuals reported that their remittances which would normally be in their accounts on the third and fifth day of the month were now routinely delayed by four to six days.

Later in the day the company representatives at the office announced that the fault was Cash Plus’ but advised that the funds had been sent to the banks for distribution. Checks with several investors late Friday confirmed that payments had landed.

One ‘new investor’ who said his returns due monthly on the 8th, also said they have never been remitted on time. His payment this month reached his account Wednesday, the 14th.

Cash Plus, meantime, has said it plans to enter the sector itself, but in the Dominican Republic where it has bought into a ‘banking institution’.

“We have interest in it,” said Golbourne, adding that it was a controlling stake, but saying the details of that investment would be released at the same time as its financials.

Golbourne, acknowledging that there was widespread concern among investors about timely remittances, said it was one of the reasons for last weekend’s hastily convened meeting at the National Indoor Sports Centre. The other, he said, was to allay fears that Cash Plus’ relationship with its bankers was faltering.

“That’s why we made a statement to clients that it has been worked out,” he explained.

By that the Cash Plus executive was referring to an announcement that the company was making arrangements for its members to be issued with an ‘international card’ that would allow them another means of accessing their funds.

Golbourne claimed that 20,000 persons had showed up for the weekend meeting, but the Indoor Centre said the crowd was no bigger than 4,000, and that the facility’s capacity was no more than 5,000 to 6,000. Golbourne, who said he was emcee at the meeting, later said he might have been wrong about the numbers.

Choice of returns

Essentially, the new payment/card system under consideration would sidestep the local banks, but the choice of how their returns are paid will be left up to individual investors.

Golbourne said that deal remains under negotiation and its details would not be revealed ahead of Cash Plus’ audited financial statements due out month end or soon thereafter.

He said, however, that a regional financial institution had approached the company with the idea of issuing a Visa-branded card to members – the company lays claim to more than a 40,000 investor base – that would give them access to funds in an overseas account or accounts to be held in the name of Cash Plus.

The system is being tested, with a few members already issued with the card under a pilot.

The card will eventually be available to all for subscription, but still to be decided is whether members would be charged a fee to acquire it.

Golbourne said the company’s ‘banking institution’ in Dominica Republic was not the company in question.

The investment scheme, whose approximately 80 business operations span several regional countries and industries, has said it will publish the accounts to quell speculation about its financial health.

“We are profitable,” Golbourne said on Wednesday.

The majority of the company’s shipping and distribution business is overseas, he said.

business@gleanerjm.com

http://www.jamaica-gleaner.com/gleaner/20071116/business/business6.html

Cash Plus defends business practices

Cash Plus defends business practices
published: Wednesday | March 28, 2007

Describing itself as “building Jamaica with Jamaicans for Jamaicans”, the Cash Plus Group has attributed its meteoric success to providing venture capital for fledgling businesses and investing three quarters of its assets in companies which are involved in “day-to-day trading activities”.

At the same time, the group, which insists that it observed “strict adherence to the best business practices,” admits that it is in talks with at least one regulatory body.

In a statement obtained by The Gleaner, the group noted that it is extremely difficult for local businesses to grow because of the unsophisticated secondary market and the “lengthy and frustrating” loan processes in the formal banking sector which, more often than not, result in the borrower being loaned less than he originally applied for.

No other

“Owing to the fact that the business has no othe it is then forced to take that capital even though it does not meet its requirements, only to find out that they are in no better shape than before.”

It is these businesses, Cash Plus says, that it invests in and has resulted in the group making over 50 acquisitions while at the same time operating debt free.

“Cash Plus has focused on certain industries which we believe not only bring substantial profit to the group, but also great benefit to the consumer. These industries include telecommunications, computers, food and entertainment.”

In fact, the Cash Plus Group – formed through a series of mergers, acquisitions, joint ventures and partnerships – has about a dozen majorsubsidiaries covering phone card distribution, telecommunications, development and construction, food, security services, import-export, computers, hotels and restaurants, automobile and auto parts. It employs about 2,000 persons islandwide.

Questions raised

Still, questions have been raised about the ability of the Carlos Hill-led Group that has been able to reward its participants (lenders) with double- digit monthly returns as well as the viability of Hill’s operations. There have been calls for the group to be regulated but Cash Plus insists its operations are open for inspection.

“Our financial statements are always available to our lenders. Each lender is able to receive a monthly statement.” Cash Plus also said it does not deal in foreign currency trading.

However, it acknowledged that it was in dialogue with the Financial Services Commission (FSC), the regulatory body for the non-banking financial sector, as well as the insurance industry.

“We have had dialogue with the FSC and in furtherance of that dialogue it is our intention to do all things necessary to ensure that we operate in harmony with [them] and all other relative regulatory bodies. We are confident that a positive resolution will be arrived at in short order,” the statement said.

Cheques from Olint, Cash Plus

Accounts closed: Banks refuse to honour cheques from Olint, Cash Plus
published: Saturday | November 24, 2007

Shelly-Ann Thompson, Staff Reporter

Customers converge on the Premier Plaza office of Cash Plus Ltd. yesterday in search of information about the operations of the popular investment club. There has been a run on the club, which Cash Plus said was precipitated by the actions of several banks at which its customers have accounts. – Junior Dowie/Staff Photographer

At least one high-risk investment scheme has advised its members that its accounts have been closed by local banks, while inside sources have told The Gleaner that some financial institutions have threatened to fire their employees who have accounts with schemes such as Cash Plus Limited and OLINT Corp.

A letter sent out to clients of OLINT advised that at least three commercial banks had taken steps to close OLINT’S accounts.

The letter, over the signature of G. Wayne Smith, OLINT’s chief executive officer, said the accounts were at “different stages of closure following advisories received from each of these institutions to that effect”.

no disruption

The letter said in part: “We would like to assure you that the closure of the local accounts will not cause any disruption to our trading activities.”

It added that “th channels that will be employed to ensure that your transactions continue to be undertaken in a confidential, efficient and effective manner will be communicated to you shortly”.

The Jamaica Bankers’ Association has stressed that it has not seen the circulars.

The Gleaner was also informed that financial institutions were yesterday on the brink of closing all accounts relating to what they deemed ‘unregistered schemes’, such as the popular Cash Plus.

alternative measures

Carlos Hill, chairman of Cash Plus, issued a statement in the print media yesterday in which he said the entity had “not taken the recent attacks on our operation lightly and as such we have researche banking measures which have been implemented”.

Effective December 1, money earned will be wired directly to investors’ bank accounts or it may be collected at any remittance outlet islandwide.

According to information reaching The Gleaner, one bank has ordered its employees to close all accounts with the unregistered o schemes or risk losing their jobs.

One source detailed that the employees of a financial institution were told that they should declare whether they had savings in any of

these schemes and then make the necessary arrangements to discontinue the accounts.

Additionally, the source said that the management of the financial institution threatened that if the disclosure was not made and the bank discovered that any of their employees held accounts, they would be fired.

However, at least one trade union has warned that the movement would not stand for such actions.

“Certainly that would not be tolerated by the National Workers Union,” said Vincent Morrison, President and Island Supervisor of the NWU.

“If they should carry out such a practice it would cause disruption in their operations and we make no apologies for the action that we would take in defence of the workers,” he said.

Mr. Morrison explained that workers have a right to decide who they do business with. “I would be of the opinion that it is unlawful that can’t be a basis to terminate anyone’s services,” he stated.

One Cash Plus investor who deposited a cheque said it was returned yesterday by a local commercial bank as “unclear funds”.

The investor said he was advised by the bank not to redeposit the cheque at the bank but to try and reclaim his money from Cash Plus. Still, many investors with Cash Plus have become irate with local banks.

One man, who spoke on condition of anonymity, said that because of Cash Plus he was able to survive financially.

He resigned from his job three years ago and invested $1.6 million in Cash Plus.

Today, he is able to pay his monthly mortgage of $55,000 and he and his wife’s monthly car payments.

“When I resigned I didn’t know how I was even going to send my daughter to college, next year she will be able to graduate,” he said.

Yesterday, he deposited another $2 million into the investment scheme.

“Cash Plus will not crash and even if they do I will never put back my money into these banks,” he said.

Other persons who turned out at Cash Plus’ disbursement office in Premier Plaza, St. Andrew yesterday shared similar sentiments.

Some of the investors said they were annoyed with the public utterances and wanted back their deposits. However, many said they were going overseas with their money.

Cash Plus has also called a meeting with its clients for today at the Merl Grove Auditorium on Constant Spring Road, St. Andrew.

shelly-ann.thompson@gleanerjm.com

http://www.jamaica-gleaner.com/gleaner/20071124/lead/lead1.html