Mon | Mar 27, 2023

Gordon Robinson | One han’ cyaan clap!

Published:Tuesday | February 7, 2023 | 12:19 AM
An aerial image of Stocks and Securities Limited offices.
An aerial image of Stocks and Securities Limited offices.

My muted reaction to the Stocks and Securities Limited (SSL) drama has been deliberate.

I’ve many reasons for not commenting on specifics. I could pretend the main reason is I don’t want to enter the over-crowded media kitchen and join the gaggle of under-qualified chefs elbowing each other out of the way so they can spoil otherwise easily prepared broth. But my solemn oath to readers, for fifteen years, has been to always tell the truth which is a long-standing friend is involved and I’ve no intention of making his life any more uncomfortable than it already is.

However, I can’t help but remember (or recall; lol) Haemorrhoid’s most tortuous Shaggy Dog tale. An edited version was already published (February 22, 2022; A Knight’s Tale) so we’ll just hit the highlights today:

Like Snoopy’s literary endeavours, it begins “it was a dark and stormy night” and is set in “a huge, lonely forest, a long time ago”. The forest was “full of rustlings, creeping, horrid noises, slitherings and squeals.”

The tale traces three Knights’ (Sirs Lancelot, Invincible and Boris) journey through the forest on a quest to rescue a missing Princess. Boris loses his horse during a mysterious attack and continues on foot trailing the others.

Eventually, Boris, whose lot had been trudge, quiver (freezing, driving rain throughout), trudge, quiver, is rescued by an enormous talking dog that carries him to a lone cottage cum pub run by an irascible landlord. The other two were already sheltering there; consumed several flagons of Old Fartz Bitter Ale; and sunk into drunken stupors.

The dog was all-around strange. Six foot at the shoulder, every doggy colour imaginable - brindle, patches, tan, pied, fox russet, wolf grey, and jackal green. It had a great lolloping silly face; half St Bernard, half fox terrier and another half Great Dane for good measure. Ugly! Enormous misshapen teeth were covered in God-knows-what and drooling. Its coat was bedraggled; long, tatty, great chunks missing; mange on some of the missing bits; and twigs and straw liberally snagged all over.

In a word (or two), Orville Burrell! Are you with me?

The dog begged the Landlord to let them in but it was past closing time and he wasn’t in a welcoming mood. Eventually the huge dog butted down the door. The Knights awoke; recognized Boris; and commanded they be let in. In a patented shaggy dog tale anti-climax the Landlord replied:

“I wouldn’t want it said I turned a knight out on a dog like this”

Apart from the awful pun, the point is anxiety for sensation may cause media commentators to miss the forest for the trees. SSL isn’t a bank. It’s a Securities Dealer. It doesn’t take “deposits”. It acts as investment agents for clients whose investment instruments should be available regardless. For example, clients’ Shares would reside at the Jamaica Stock Exchange.

What could’ve happened here is investments were sold without authority and sale proceeds transferred to inappropriate third parties. This isn’t something a Regulator or external auditor can easily detect or prevent. The FSC did flag systemic flaws but was slow to impose an extreme sanction. This is as it should be. Unless there’s no option Regulators regulate not obstruct economic activity. What we don’t yet know is how much, if at all, FSC’s action (or inaction) was influenced by political interference or influence.

External auditors depend on information from management and check systems for compliance with approved accounting standards. Only a forensic audit can uncover fraud and then only after the fact. Every company’s operations depend on people so fraud prevention is impossible. Reduction of fraud to practical levels/early detection and sanctions are corporate management systems’ duties.

One last thing (said Lieutenant Colombo). Because client’s funds are used only to invest in securities, there’s no balance sheet liability directly to any client for “deposits” as in commercial banks. So a balance sheet showing the company’s assets and liabilities could easily show solvency even after a massive fraud has been perpetrated on clients. A lawyer’s letter doesn’t create a “liability” and thorough, independent investigation is necessary before finger-pointing can begin.

A name keeps appearing in the public domain as having “confessed”. But the document bruited about isn’t a confession. It wasn’t made to police after caution. It’s an internal document (assuming authenticity) made for the purpose of disciplinary proceedings and is unlikely to be admissible at any criminal trial. Also, with regard to repeatedly expressed shock that the “confessor” isn’t arrested, it’s pellucid that police consider the status quo more valuable. The suspect is obviously cooperating.

My sainted granny would say “One han’ cyaan clap!”

Peace and Love.

Gordon Robinson is an attorney-at-law. Send feedback to columns@gleanerjm.com.