Cash Plus March deadline uncertain – We don’t want investors’ names, says FSC.

Cash Plus March deadline uncertain – We don’t want investors’ names, says FSC.
published: Sunday | March 16, 2008

File
George Roper, acting executive director, Financial Services Commission.

Sabrina N. Gordon, Business Reporter

Cash Plus Limited (CPL) and the Financial Services Commission are in dialogue to explore the possibility of the investment scheme registering its operation in compliance with the securities law.

But, up to a week ago, Cash Plus still had not formally applied to the Financial Services Commission (FSC) for registration, the regulator confirmed to Sunday Business.

On Friday, the FSC also sought to calm the scheme’s nervous investors, saying it was not interested in obtaining their personal information.

‘Not trying to hinder’

That concern emerged after the FSC issued an olive branch to Cash Plus, allowing the company leeway to pay investors, but under strict conditions that required the scheme to say how much it owed, and explain how it would fund the payments.

“The FSC has not requested that CPL provide a list with the names of its investors,” said an FSC statement.

“The FSC is not trying to hinder CPL from making payouts to investors,” it added. “The FSC has always indicated its willingness to allow CPL to make payouts to its investors once they approach the FSC for such permission.”

To meet the March 31 deadline it announced to club members to resume monthly payment of returns, Cash Plus would have had to apply for registration at least a month before, Sunday Business checks indicate.

Up to March 6, there had been no application.

The FSC says it takes, on average, one to six months to process applications, depending on whether the required submissions are sufficiently detailed.

At the end of February, Cash Plus had declared in a public advertisement plans to resume payments of monthly returns by March 31, but noted that it was contingent on FSC approval.

A cease-and-desist court order issued in December remains in effect against the investment scheme until it is licensed to deal securities or have its investment products registered.

The order bars the company from conducting securities business with members of the public, which includes the taking of new funds and making payments to its investors.

But, the FSC has opened a window for Cash Plus to make payments, pending registration.

The FSC said in a public notice that it is willing to vary the order, allowing the investment scheme to pay all outstanding balances. Cash Plus has not reacted publicly to the FSC offer.

Lawyer Harold Brady, when asked for comment, referred Sunday Business to another attorney, Minett Palmer-Lawrence – said to be Cash Plus’ general counsel – but efforts to get in touch with her failed.

Variation

The variation will be granted once Cash Plus provides the FSC with information on the total number of investors to be paid, the sum to be paid, the method to be used and the source of funds, “for example, whether this is by way of loan or sale of assets,” the FSC said Friday in its statement.

“The FSC believes that it should be very easy for CPL to provide this information and indeed, CPL to date has not indicated to the FSC any objection on (its) part to supply this very basic information,” the regulator said.

In an earlier interview with Sunday Business, acting executive director of the FSC, George Roper, said the variation would be rescinded “if any evidence running counter to the variation in respect to the payment is found”.

The FSC said it would advise the public if and when CPL accepted its offer, but had said in its ad that it was not prepared to vary the cease-and-desist order beyond June 30.