Alliance to face court under suspension

Alliance Investment Management Limited (AIML), Alliance Financial Limited (AFL), their President Peter Chin and Vice President Robert Chin are facing a raft of charges for alleged breaches of the Bank of Jamaica Act, the Banking Services Act and the Proceeds of Crime Act.

Yesterday, the Bank of Jamaica (BOJ) also suspended AFL’s authorisations to operate cambio and remittance businesses and to operate in the BOJ Fintech Regulatory Sandbox.

AFL and Peter Chin were charged with carrying on the business of lending foreign currency without being an authorised dealer in relation to more than 20 foreign currency loans, totalling approximately US$8 million, to various entities.

Robert and Peter Chin are jointly charged for alleged breaches of the Banking Services Act for accepting deposits without the requisite licence from the BOJ relating to a series of deposits in excess of US$7.5 million over a three-year period from 2014 to 2017.

Additionally, AIM was charged with failure to file threshold transaction reports as mandated under the Proceeds of Crime Act for transactions of, or exceeding, US$15,000 (or its equivalent in any other currency) to the Financial Investigations Division (FID).

Multi-agency probe

FID Chief Technical Director Selvin Hay said the charges came after a multi-agency probe which also involved the Counter-Terrorism and Organised Crime Division, the Major Organised Crime and Anti-corruption Agency and the police Major Investigations Division.

Law enforcement authorities from the agencies had carried out a coordinated search at the two financial institutions in 2018.

“Following an investigation, a thoroughly prepared case file was submitted to the Office of the Director of Public Prosecutions (ODPP). After perusal of the file by officers of the ODPP and several consultations, the ODPP ruled that the charges be laid against the companies and their principals,” Hay said in a press release.

As a result of the BOJ suspensions, AFL is no longer authorised to buy or sell foreign exchange or offer MoneyGram remittance services at its five locations in Liguanea and New Kingston in St Andrew, Mandeville in Manchester, May Pen in Clarendon, and in Portmore, St Catherine.

The revocation of authorisation to operate in the BOJ Fintech Regulatory Sandbox means the company can no longer operate as a payment services provider, the BOJ said. Current holders of the Alliance ePay Card will be allowed to continue to use available balances on their cards, but will not be able to cash out or top up their account balances.

Attorney-at-law Tom Tavares-Finson, who is representing the Chin brothers, yesterday said that he was committed to resolving the matter “amicably via the court and ensuring that justice prevails”.

“What AFL has been accused of doing really is a matter which is not unusual in terms of what was up until recently considered financial best practice in the sector across Jamaica and the region,” he added, noting that when concerns about some transactions were raised a few years ago, following an internal review process, the company alerted the BOJ and took steps to ensure it remained in good standing with all relevant rules and regulations.

AFL is a lending company that primarily has as its core business insurance premium financing and short-term loans. The company had signalled its intention to approach the equities market via an initial public offering of shares (IPO) in December 2020.

In October, FID Principal Director Keith Darien had indicated that investigations were under way into the operations of at least six institutions operating in the financial sector that are not in compliance with the law.

“We believe that a couple of these institutions may be prosecuted or they will have to be addressed from a point of the fixed-penalty regime, which was included in the Proceeds of Crime Act in November 2019,” he said.