January 23, 2023

SSL saga spirals

article reposted by Chelsea

via jamaicaobserver.com

WITH speculation running rife about what has become of clients’ money since the Jamaica Observer broke the news of a massive fraud at Stocks and Securities Limited (SSL), its former Chief Executive Officer Zachary Harding has sought to clear the air about the relationship with SSL and his new company, Delta Capital Partners Limited.

At the same time, Observer sources have confirmed that sprint legend Usain Bolt has been resisting approaches by at least three major media houses overseas to do in-studio interviews relating to the theft of at least US$12 million from his SSL account.

According to our sources, the media houses have reached out to the retired athlete with offers to fly him first class to sit with them, coming after news that his lawyers have threatened to sue SSL and the Financial Services Commission (FSC) if his investment is not returned by January 27.

Meanwhile, on Saturday, Harding sought to create distance between SSL and Delta, the private equity company he formed in June 2020 in partnership with SSL founder Hugh Croskery.

He explained that while at SSL he was of the view that the company needed to move in a different direction “because the business model was flawed”.

“As a result, a new entity (Delta) was formed to look in a new direction,” he said.

Harding explained that the reason Croskery had shares in that initial entity when it was formed “was simply because I was an employee at SSL but I was trying to branch out to create a new entity that could be prosperous and so I gave him, so to speak, some shares in the entity”.

At its launch the SSL Group’s board of directors had indicated in a press release that Delta, a legally separate entity, had its full support.

“Importantly, Hugh Croskery was never a director of that company and he was not actively involved in Delta. It was merely a construct of how it was set up to facilitate trying to get a new business off the ground…” Harding told the Observer.

He said that the two entities separated, “not that they were really joined but they separated and they have no legal connection. One is not a subsidiary of the other in any shape or form and there’s no common shareholdings”.

Harding said that based on the arrangements entered into with Croskery, his shares have been transferred back to Delta.

“He’s not a shareholder of Delta and neither am I a shareholder of SSL — there’s no legal connection,” he repeated.

However, up to last Thursday the Companies Office of Jamaica website listed Croskery as the second-largest shareholder of Delta with 450,000 ordinary shares. Harding holds the majority with 575,000 ordinary shares.

On Sunday when the Observer put that information to Harding he said that on October 13, 2022 a notice to the registrar was filed noting that all of the ordinary shares held by Croskery were surrendered effective September 2022.

He provided a copy of the notice signed by Moreen Page for the Registrar of Companies.

Harding said the share transfer information “will not show in the Companies Office website as yet because the annual returns are not due before October 2023, and it is at that point that the website would be updated”.

“Neither SSL, nor Hugh Croskery, nor any entity associated with them have any shareholdings in Delta or any of its companies. From the outset Hugh was a passive partner. He played no active role in the day-to-day operations of Delta and was represented on Delta’s board of directors by his daughter, Sarah Croskery Meany,” Harding explained.

“So it was not a case where a new entity was set up and money from SSL was used to set up Delta. Delta has raised money from various clients across the world in order to capitalise itself and to make the acquisitions that it has made — just like any other private equity type firm. It was not funded by SSL, and certainly Usain Bolt’s money was not used to form Delta or to make any investments,” Harding said.

He told the Observer that during his stint as CEO at SSL, from September 2019 to June 2022, he was not aware that Bolt was an investor with SSL.

“It never came up, it never featured in any meeting ever,” said Harding.

Bolt’s attorney, Linton Gordon, in his January 16 letter to SSL had pointed out that the world record holder had established an account with SSL “via a limited liability company” essentially for his pension.

The attorney stated that on October 31, 2022 the account showed a balance of US$12,758,181.74. However, on the date when he wrote the letter Gordon said the account had been depleted to US$12,047.65.

Bolt is among at least 40 investors hit by the fraud which is being investigated by the police Fraud Squad, the Financial Investigations Division and the FSC.

Meanwhile, Harding has lashed out at people who he said are spreading misinformation on social media.

“It is damaging to the people who are mentioned, who are innocent, who are not involved in anyway. It’s damaging to their families, it’s damaging to the reputation of other entities, it’s damaging to potential investors,” Harding said.

He said it was also damaging at a global level as it is impacting Jamaica’s brand as an investment destination, although the two are not connected.

“You have specific people that go on their social media pages, post pictures of individuals, make accusations and assertions on their posts,and then you have a whole bunch of people underneath supporting the posts and spreading it as though it is true.

“It is risky and it is dangerous and people need to be a lot more circumspect in what they take as accurate,” he said and appealed to the people spreading misinformation to “allow the proper journalists and the police investigators to do their work”.

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