David Smith

There are indications that US authorities could request the extradition of Olint’s boss David Smith and operators of some major feeder clubs, especially those that operated in the United States, and solicited funds from US citizens.

Entities such as Wachova Bank, MZ Holdings Limited, and Market Traders Institute are among entities under the microscope by the US–based Federal Bureau of Investigations, for alleged money laundering charges. Based on reports on RJR 94 FM on Thursday, Smith and a young, wealthy businessman are among 15 Jamaicans under investigation by the United States government for alleged money-laundering, following the collapse of the multi-billion dollar foreign exchange trading scheme. RJR reported that a judge has given the local authorities, the green light to investigate the Jamaican accounts of Smith and other persons named on a list submitted by the US government. Smith had up to $40 million in one local institution.

Last week the Sunday Herald reported that the US government would increase extradition requests for up to 20 Jamaicans. US assistant secretary of state Arturo Valenzuela confirmed the increased extradition requests during the visit to the island last week

Under investigation

Two weeks ago, the Director of Public Prosecutions, acting on behalf of the United States government, obtained a court order giving local investigators the power to dig into Smith’s accounts and those of a long list of individuals and companies.

The application, which was made under the Mutual Legal Assistance (Criminal Matters) Act, requested the sharing of all documents, records and articles relating to the accounts of the individuals named and their companies. The Bank of Jamaica has been instructed to disclose the information.

The BOJ, which regulates the financial sector, is in turn expected to instruct one of the country’s major financial institutions to turn over the documents and information on the accounts. Among those also under investigation are Smith’s wife, Tracy Ann Simone Smith; his brother Gilbert; Olint; Olint Foundation and Olint Corporation. The son of a major figure within the governing Jamaica Labour Party is also on the list submitted by the US authorities. The US government says it also wants to look into the account of a huge private company and a major figure in the football fraternity, as well as several well-known Jamaican businesspersons.

At time of collapse

Smith was arrested and charged last year with fraud and money laundering in the Turks & Caicos Islands following the collapse of Olint. All his assets and those of Olint have since been frozen.

In December a court issued an order restraining Smith, his wife and brother from selling or dealing with any of their assets or assets held by them on behalf of other persons. The order forbids them from withdrawing or transferring funds from their accounts exceeding US$215 million.

It’s reported that at the time of its collapse, Olint had 6,000 clients with total investments of US$220 million. Several law suits are pending in US courts against companies and individuals including Wachovia, MZ Holdings Limited, Jared Martinez, Isaac Martinez, David Smith, Olint, Market Traders Institute among others.

Allegations are that Olint was promoted to the Jamaican- American community living in the United States and the Jamaican Diaspora living in the Eastern Caribbean. Smith operated what is described as Ponzi scheme known as the Overseas Locket Corporation (Olint).

Smith they claimed convinced over 1,000 investors that he and agents of Olint could produce a return of 10 per cent per month by participating in foreign currency exchange trading.

The Financial Services

Commission of Jamaica investigated David Smith’s financial operation and after being forced to cease and desist his operations in Jamaica by that governing body he moved his operation to the Turks & Caicos Islands (TCl).

After that several feeder clubs, some of which are being sued, targeted American investors directly or indirectly to invest in the Olint hedge fund. Based on their aggressive advertising of the high rate of returns, investors claimed that Olint raked in over US$1-billion from investors who were based in the USA, TCI, Jamaica, St. Kitts, Panama, Grenada, the Cayman Islands and Dominica Republic. Smith achieved this by allegedly fraudulent advertising on the Internet. David Smith, as a result of the large number of investor complaints, was arrested and charged with money laundering, fraud and theft by the Royal TCI Police Financial Crimes Unit.

Speaking at a media roundtable held at the US Embassy last week, Dr. Valenzuela also reminded the country that the US is currently helping Jamaica to diversify its export base under the Caribbean Basin Initiative (CBI), which was negotiated between the Edward Seaga and Ronald Reagan-led administrations during the 1980s. Under this agreement a range of Jamaican goods are given duty-free access to US markets.

He however, lamented the fact that Jamaica has not been able to take full advantage of the agreement, while encouraging the country’s export promotion agencies such as Jampro, to review these benefits to see how they can best diversify exports and grow the economy.

Dr Valenzuela’ comments came against the background of the steep fall in the country’s export earnings from US$2.7 billion during the year 2008 to $1.3 billion last year, mainly due to the steep fall-out in the bauxite and alumina sector, which generated almost 60 per cent of total merchandise exports.

This trend continued during the first quarter of this year, when exports stood at US$354.0 million on the back of a dip in bauxite alumina earnings to US$115.1 million from US$139.8 million last year.

Meanwhile, the assistant secretary of state also stressed that the US would continue to help Jamaica in its promotion of energy diversification.

He pointed out that Jamaica has given a commitment to generate between 10 and 20 per cent of its energy from renewable sources in 2010 and 2015. The top US diplomat also pointed out that the Obama administration fully supports the government’s drive to reduce the country’s dependence on imported fossil fuels in order to become more efficient.

Deepening the analysis, Dr. Valenzuela also indicated that Jamaica currently participates in the US/Brazil bio fuels initiative, and that the country received US$250,000 from his country as part of a technical assistance programme to help increase domestic demand and consumption of biofuels.

Jamaica’s fuel bill jumped by US$88.4 million last year to US$393.1 million or 33.7 per cent of total imports because of the higher international fuels prices.

Dr Valenzuela also said that the US placed an embassy science fellow in the Ministry of Mining and Energy for seven weeks with a mandate to help Jamaica develop its bio fuels initiative.

Turning the weighty matter of tax reform, the top US diplomat stressed that the US provided the Government of Jamaica (GoJ) with a US$2 million grant for on-site technical assistance, as well as representatives from the US treasury, while stressing that these efforts are already paying dividends.

Jamaica’s premier broad band provider Flow celebrated their fourth anniversary recently with a media breakfast where they showed off exactly why their entry in Jamaica’s telecommunication landscape has had a positive impact, one especially felt in the pocket of the everyday consumer.

Held in the boardroom at their corporate head offices, St. Lucia Avenue on Thursday July 22, the occasion served a twofold mission of Flow executives getting to know some of the key movers and shakers in the media fraternity, as well as getting said media practitioners up to date with what Flow has been doing in Jamaica over the past four years.

Flow’s president and chief operating officer Michele English said that with a whopping US$250M capital investment to date, Flow has significantly bolstered the competitiveness of Jamaica as an investment and business destination.

“It’s been an exciting and rewarding four years. It’s been challenging but positive in terms of the kinds of products we brought and the reception we have got from consumers.”

In addition to Flow’s hefty capital injection and first world infrastructure that was rolled out, Ms. English also revealed that Flow has set up an e-Commerce Data Park in Curacao for offshore data storage and protection. This facility was deemed necessary, as the region is prone to disasters such as hurricanes and earthquakes and therefore the loss of vital business data was possible.

ECP offshore facility

Flow took the decision to be proactive and plan ahead with a Network Operation Centre with specialized services for asset protection, data residency and privacy. Curacao is outside of the hurricane belt and earthquake zone and therefore the ECP offshore facility could offer cost effective solutions for businesses looking to protect their data. Through this infrastructure Flow directly connects Jamaica to both North and South America making Jamaica’s data connection the most resilient in the region.

Since Flow’s entry, they have changed the way telephone service is provided in Jamaica with free calls from Flow to Flow numbers and cheaper calls when connecting to the other networks.

“Our monthly line rental is 24 per cent cheaper and it comes with all the standard features so it has proven to be great savings for residents plus corporate companies also benefit especially if they have multiple sites and locations.”

Since 2006 Flow has created over 550 jobs with less than two per cent of these being held by non- Jamaicans. Currently there are plans to roll out facilities in Montego Bay and Ocho Rios.

As good corporate citizens, Flow has invested at the community level primarily in education with free internet connection in high school and the ‘cable in the classroom’ initiative that fuses educational content into the school’s lesson programmes.

For 2010 Flow has also been on board in sponsoring sports and cultural activities such as the Jazz & Blues Festival and Calabash to the tune of $80 million.

Synonymous with innovation

Outlining and demonstrating Flow’s bold new initiatives, director of marketing Sharon Roper said that flow has become synonymous with innovation designed to facilitate their customers enjoying their services at optimal prices.

‘Cable Your Way’ allows customers to pick their own channel in a bundle of ten and this has been well received. Customers can also play games, view mosaic channels and even tune into Flow’s own weather channel that highlights weather from Jamaica, the Caribbean and popular destinations in the UK, Canada and USA.

Customers could also join Flow in going green and view their bill on their TV thus rendering the need for a print statement redundant. Other brand new features on Flow, said Ms Roper, includes caller ID on TV and Flow on Demand that offers six categories of programming from music to movies to adult entertainment.

Riding sea of technology

Special guest, Minister of Information and Telecommunication Daryl Vaz congratulated Flow on their success.

“We have watched over the last four years with satisfaction, Flow riding the seas of technology with skill. The trending down of prices since your entry and the significant decrease in broadband rates are a welcome addition by Jamaicans.

“Flow’s success,” he said, “is an indication that Jamaica is open for business and that it does take more than a click to seize opportunities and maintain a high standard of performance. All of Flow’s achievements,” he continued, “are worthy of commendation. We look forward to a tomorrow with legitimate expectation for ICT to be the driver with everyone engaged and reaping the benefits of technology.”

The combined team’s top three fighters, Kenneth Edwards, Alrick Wanliss and Nicholas Dussard, were rested from team competition ahead of their participation in the CAC Games in Puerto Rico.

Having won team gold at every US Open since 2006,McKay said he had to strategise to ensure Jamaica came home with another title. Ironically, it was McKay and Edwards who had won Jamaica’s first team gold in 2006 as a two-man team.

They had traveled as part of the Jamaican contingent, whose fiveman team was sidelined by newly imposed weight regulations.

“I needed reliability more than anything else on the day,” McKay said, explaining his choice of Edwards a second time around. “In masters divisions, you need people with significant experience. Keith has more than 20 years of competition behind him and I could rely on his dedication and reliability to anchor us to gold.”

In 2006, Edwards, the elder brother of combined team superstar, Kenneth Edwards, had not competed for a number of years, but was training with the then young combined martial arts team, which was trying to make a name on the international circuit.

It was a similar case last week as Edwards, who was at the Open coaching his own team of fighters, Ningen karate.

However, he once again called on the experience of Edwards answered the call and the two fighters skillfully worked their way to the final, defeating the British kickboxing team in a 10-9 encounter.

McKay said it was a welldeserved victory for the veteran duo to joined forces and repeat their 2006 gold medal at the biggest mixed martial arts tournament in the world.

The gold won in Orlando represented significant improvement this season for McKay. For the last two seasons, he has been marred by injuries, illness and deaths in his family, resulting in average performances – two bronze in 2009 – despite captaining Jamaica to the World Continental Team Fighting championship.

This year, he won silver at the International Taekwondo Pan Am champs in Argentina in the heavyweight masters division.

Retirement,he said, is not his call. “As far as my feet will carry me,” he said.

Gaza’s ubiquitous donkey carts are facing stiff competition after an influx of South Asia’s iconic tuk-tuks, powered by ultra-cheap smuggled fuel, have hit the roads of the besieged coastal strip.

The auto-rickshaws, in which the front half of a motorcycle is welded onto a two-wheel trailer, are well-adapted to the four-year blockade that has transformed the local economy and daily life in the Palestinian territory.

And the phenomenon highlights one of the stranger side effects of the Israeli border closures — that gasoline in Gaza is now cheaper than water.

Ahed al-Idrisi, a 29-year-old accountant who has made a living by buying and selling household goods since he was laid off in 2007, sold his 7,000 dollar (5,400 euro) car a few months ago to buy a 2,400 dollar high-end tuk-tuk.

The shiny blue contraption, with “Wadi Terbo” painted on the side and bubble wrap still taped to the shocks and headlights, gets 25 kilometres (15 miles) per litre and can traverse the coastal strip in a little over an hour, with the cost of gasoline rarely exceeding three dollars (2.3 euros) a day.

“Animal feed for donkeys is expensive because it comes from Israel. These days the cheapest thing in Gaza is fuel,” he said. Israel and Egypt largely sealed Gaza’s borders in June 2006 when Palestinian militants captured an Israeli soldier in a deadly cross-border raid and tightened the siege when the Islamist Hamas movement seized power a year later.

Since then a vast network of tunnels along the border with Egypt — taxed and regulated by Hamas — has supplied virtually all consumer goods, including heavily-subsidised Egyptian gasoline, to the territory’s 1.5 million people.

These days a litre of gasoline pumped in from Egypt costs 50 cents (0.40 euros), less than a third of the price of a litre imported from Israel.

That in part explains the constant groan of gasoline-powered generators along Gaza’s crowded streets, which keep fans and air conditioners running during the frequent power outages.

And it allows Abu Fayez Kali, 36, to support his family of 15 by driving his bright yellow tuk-tuk to farms across Gaza in order to buy chickens to slaughter and resell at Gaza City’s Shajaiyah market.

“It’s much faster than a donkey,” he said as he sat in the covered trailer, the tuk-tuk parked in a line of wooden carts tethered to the beasts.

“A donkey would cost me 20 to 30 shekels (five to eight dollars) a day for feed. The fuel for this thing is just 10 shekels. And it goes 80 kilometres (50 miles) an hour,” he said.

The tuk-tuks are mostly made in China, shipped through the tunnels in crates and reassembled in the border town of Rafah. Most are of the motorcycletrailer variety but some classic Indian-style tuk-tuks with pillshaped cabins have also appeared recently. Unlike in cities and towns across South Asia, they are not yet used as taxis.

Bowing to international pressure in the wake of its deadly May 31 raid on a Gaza-bound aid fleet, Israel said last month it would allow all civilian goods into the territory, but automobiles have not entered since 2007.

And although Gaza’s supermarket shelves are stacked high with food and household goods, its private sector is mostly in ruins because of the closures, with virtually all factories shut down and unemployment topping 40 percent. In recent months car dealers along Salaheddin Street, Gaza’s main thoroughfare, have reluctantly rolled out the tuk-tuks in order to stay in business.

Mustafa Abu Warda, who sold cars in Gaza for nearly 30 years before the blockade, would like to return to his former trade and, like most Gaza businessmen, despises the informal tunnel economy.

“When we were selling cars brought in from Israel everyone benefited — the dealers, the mechanics, the garages. Everyone had work. With the tuk-tuk, the only one who benefits is the tunnel owner,” he said.

“He charges me 300 dollars for each tuk-tuk, and my profit margin is only 100 to 150 dollars. I’m practically losing money.”

He nevertheless understands the appeal of his new product. “Donkeys die. Tuk-tuks don’t.

What is inside sealed document 265 which was placed in Judge P Patterson’s vault, the presiding judge at the first hearing of the case against alleged shower posse boss Christopher Dudus Coke . Legal experts are speculating that contents of those documents, when disclosed could have major implications for the members of the Bruce Golding led administration.

According to the legal experts, the seal document could contain a superceding indictment, implicating influential Jamaican officials. Since last week unconfirmed reports have been circulating that some high ranking public officials and prominent businessmen implicated in drug running are wanted by Uncle Sam

Some high-ranking Jamaicans are said to be among a list of narco dealers for whose extradition the US authorities are expected to make requests to the Government of Jamaica in coming months.

Based on reports from the United States Department of Justice Office of International Affairs, the number of extradition requests for Jamaicans wanted for drug and gunrunning charges, is expected to increase dramatically by yearend.

Highly placed sources told the Sunday Herald that as many as 24 sealed indictments are in the possession of US authorities following Grand Jury hearings into alleged drug and gunrunning charges against Jamaicans including several high ranking businessmen and leading members of the local drug cartel, some of whom are said to be major financiers of the ruling Jamaica Labour Party and the Opposition People’s National Party.

Some of those involved operate between St. Ann and St James. Investigators told the Sunday Herald that evidence gathered suggests that the players have been smuggling drugs into the US for the past five years. It is believed that information provided by two leading smugglers, who cut plea bargaining deals with US authorities after they were extradited to the US, might have formed the basis for the latest charges.

Sources in diplomatic circles said the visit of Arturo Valenzuela, assistant secretary of state, western hemisphere affairs, to Jamaica this week would be used to discuss, among other things with Jamaican authorities, their obligations under the US/Jamaica extradition treaty and to clarify US Jamaican security goals at the diplomatic level.

The senior US envoy would start his three-nation trip Saturday in the Bahamas. He will also visit Trinidad & Tobago for talks with the newly elected Government of Prime Minister Kamla Persad-Bissessar, the State Department said.

Jamaica’s reliability as a credible partner in the fight against drugs was called into question during the prolonged extradition affair concerning alleged drug lord Christopher Coke, who was wanted in the United States. Jamaican Prime Minister Bruce Golding in May ordered an assault on his west Kingston constituency in which 73 civilians were killed in the search for Coke.

Coke was caught a month later and flown to New York, where he faces life in prison if convicted on drug and gun-trafficking charges.

For example, under the agreement, the primary surplus should be running at $12.1 billion in June in order to meet the target of $83 billion set for this year, yet the actual outcome for May was just $3.2 billion.

The primary surplus measures the difference between total revenue and grants and total non-debt expenditure and the extent to which the government is cutting back on spending in order to service the debt.

During the first quarter, the government had drawn down on several public sector agencies, including the Bank of Jamaica in order to meet this vital solvency test. This helped to push the central bank’s losses to $10.0 billion during the first six months of this year.

Similarly, central government and the public sector accumulated over $100.0 billion in suppliers, employee and tax arrears during the period to March 31, although the programme calls for zero arrears.

The exchange rate outlined in the programme calls for a floor of J$89.35 and a ceiling of J$95 but the currency is now trading at J$86.41 to the US$1, yet the IMF says the programme is on track. The overall public sector deficit was also running at $7.3 billion in May when the programme calls for a deficit of $3.0 billion.

Analysts say that the government is likely to raid all public sector bodies and pile up more arrears in order to meet this target.

Meanwhile, exports are also running at US$1.3 billion annualized, when the programme calls for a rebound to US$1.6 billion this year. Imports also running at US$4.2 billion annualized, although the programme projects them at US$4.2 billion.

Speaking at Jamaica Chamber of Commerce (JCC) board meeting Dr.Gene Leon, the IMF senior representative in Jamaica stressed a team from the IMF would arrive in the island in August in order to conduct its assessment of the country performance, while pointing out that recent macro economic data indicated that the country is in an improved position.

He was also quoted as saying that barring a natural disaster, the country could should pass the June test and further that exporters did not quarrel when the dollar depreciated by 20 per cent to almost J$90 to the US$1. Dr Leon also argued that the appreciation to J$86 to the US$1 would have an impact on exporters, while stressing that it was not so bad.

He said that the fund used three methods to determine the equilibrium or market clearing exchange, while pointing out that one method indicated that the currency was undervalued and another that it was overvalued. Dr. Leon however, said that the Fund does not follow these methods in a slavish way.

At the end of the four Digicel Kick Start Clinics, John Barnes will select eight of the most talented footballers, who will be given a once in a lifetime opportunity to train with some of the best football coaches in the world at English Premier League Club, Sunderland AFC. This is the third consecutive year that Sunderland has partnered with Digicel in the project.

Commenting on the Digicel Kick Start Clinics and his role as head coach, John Barnes said; “The Digicel Kick Start Clinics are a fantastic initiative which searches for the best and brightest footballers to give them the opportunity to train under professional coaches and to be in with a chance to spend one week training at the Academy of Light at English Premier League Club, Sunderland AFC. Over the past four years, we have seen a wealth of talent emerge from each of the countries the Clinics have visited and I’m excited to meet this year’s crop of talent.” Jack Warner, vice president of FIFA and president of the CFU and CONCACAF, said; “Football is one of the most popular sports in the world and I’m delighted that Digicel, as one of the biggest supporters of the development of football in the region, is hosting the Digicel Kick Start Clinics for the third year running. It is important that up and coming young footballers get the opportunity to learn from experienced international coaches.” Digicel head of sponsorship, Karl Donnelly, said of the upcoming Digicel Kick Start Clinics; “We are delighted to be bringing the Digicel Kick Start Clinics back to the Caribbean and Central America. At Digicel, we are committed to supporting the development of football across the region and we believe that the Digicel Kick Start Clinics give aspiring young footballers a fantastic opportunity to learn valuable football skills under the guidance of professional coaches with a wealth of international experience.” Sunderland AFC’s Marketing and Commercial Director, Lesley Callaghan, added; “Sunderland AFC is delighted to once again partner with Digicel as part of the Digicel Kick Start Clinics. This is the third year of our partnership and the alliance continues to flourish.We are delighted to be able to give these talented young footballers the opportunity to train at our club and in the Academy of Light, as we have one of the best training facilities in Europe. It will be an invaluable experience for them to see how a Premier League club operates and to train alongside a host of international football stars.”

Digicel has been involved in a wide range of football initiatives designed to support the development of football in the Caribbean and Central America over the last six years. Digicel, which has operations in 32 countries worldwide, sponsors 17 football federations and leagues, as well as the Digicel Caribbean Cup and the Copa de Naciones Digicel in Central America.