The ongoing court proceedings involving Stocks and Securities Limited (SSL) took an unexpected turn on Thursday, as the Financial Services Commission (FSC) moved to have a crucial report filed by the SSL trustee sealed. The case, overseen by Justice David Batts, was initially meant to provide an update on the liquidation of SSL, a company embroiled in a massive fraud scandal. However, FSC’s legal counsel, Symone Mayhew, KC, made an urgent request to keep the trustee’s report confidential due to concerns over its sensitive content.
This report was prepared by Caydion Campbell, who was appointed as trustee of SSL in May despite opposition from the FSC. His task was to compile a comprehensive assessment of SSL’s financial situation and activities within a 90-day period. Though the report was due earlier, Campbell submitted it the day before the hearing, requesting retroactive approval for the late filing.
Mayhew voiced her apprehensions about the delayed report and its content, noting that it raised several red flags for the FSC. She pointed out that the last-minute submission placed the FSC at a disadvantage, leaving them with little time to fully assess its implications. “There are aspects of this report that deeply concern us,” Mayhew said, adding that the FSC believes certain sections of the document require further scrutiny.
Justice Batts accepted the late submission of the trustee’s report as final, acknowledging the unusual nature of the case. However, Mayhew requested that the report be sealed from the public until further review. The FSC raised concerns about the potential impact of the report’s release on ongoing proceedings and stakeholder interests, especially creditors and claimants tied to SSL.
In response to these concerns, Caroline Hay, KC, representing trustee Caydion Campbell, urged the court to proceed with caution regarding any public disclosure. She highlighted the risks of misinterpretation or misinformation that could arise if sensitive details were made public prematurely. Hay also mentioned Campbell’s plan to file additional applications related to the case, which could further influence the winding-up process.
At the heart of the dispute is SSL’s complex financial situation, including the trustee’s ongoing efforts to recover funds and assets. Campbell has been evaluating decisions made by the former temporary manager, Kenneth Tomlinson, who was appointed by the FSC in 2017 and removed earlier this year. Among the key issues is SSL’s fidelity insurance policy, which Campbell aims to recover for the benefit of SSL’s creditors.
While the FSC pushes for the report to remain sealed, Hay argued that the FSC should also exercise caution in its public statements about the case. She specifically referenced prior media coverage that could mislead the public about the current state of SSL’s liquidation. “We ask the FSC to be mindful of its communications, as inaccurate narratives can create confusion among stakeholders,” Hay remarked, emphasizing the need for both parties to approach the situation delicately.
SSL’s troubles began in January 2023 when a massive fraud was uncovered, leading to its collapse. Despite the termination of SSL’s membership with the Jamaica Stock Exchange (JSE), the company continues to hold an FSC license, although it is no longer engaged in trading activities.
Mayhew acknowledged that even though SSL is in the process of being wound down, the FSC still holds regulatory responsibility over certain assets, particularly those off the company’s official balance sheet. She indicated that the FSC’s role as a regulator remains active, and there are outstanding matters that fall under its jurisdiction despite the company’s pending liquidation.
As the court hearing came to a close, Justice Batts urged all parties to avoid making further public statements until the next scheduled court date on October 10. He confirmed that the FSC’s request to seal the trustee’s report would be reviewed at that time. Additionally, Batts released independent counsel Carlene Larmond, KC, from her duties in the case, expressing appreciation for her contributions over the past year.
