Gareth Manning, Sunday Gleaner Reporter

Hill

A LARGE group of Cash Plus investors in the United States are pre-paring to join their counterparts in Jamaica who are taking legal action against the investment company to retrieve their funds.

Last week, an attorney-at-law and a law professor filed lawsuits against Cash Plus in an effort to recover J$100 million and $117 million, respectively, that they invested in the alternative investment scheme that has floundered.

No relief possible?

Commenting on the lawsuits, attorney-at-law Shirley-Ann Eaton says suing Cash Plus will not bring people any relief.

"It makes absolutely no sense. There is nothing really to recover because they have to find out how much he really has and he hasn't disclosed how much he really has," Eaton reasons. "And, secondly, even if they sue, I do not see any court ordering immediate pay-over of the money if a criminal action is pending against them," she adds.

Any money he has, she argues, may well be the proceeds of crime and the court will pay over the proceeds (to the State).

Cash Plus went into receiver-ship last month following several months of battle with commercial banks and the FSC, which placed a stop order on the company's business in December 2007. Its key figures, chief executive officer Carlos Hill, his brother, Bertram Hill, and chief financial officer Peter Wilson were subsequently arrested, charged and slapped with several counts of fraud.

Last week, a report from the court-appointed receiver manager, Kevin Bandoian of Pricewater-houseCoopers in the United States, showed that the company was in very poor financial health with its liabilities exceeding assets by nearly 500 per cent.

The company seemed to have been operating as a pyramid scheme, using 70 per cent of what it received from lenders to pay its other lenders.

Dire financial straits

The situation has left very little hope for its estimated 35,000-45,000 investors who are still waiting nervously to hear if they will be able to collect their funds.

Several members of the diaspora, who lent hundreds of millions of dollars to the informal investment club, tell The Sunday Gleaner that they are in dire financial straits, and will be seeking relief through the courts.

One woman, who said she was a Wall Street entrepreneur, related that she invested J$40 million in Cash Plus and lost everything.

She raised the money through her company and had originally intended to invest it in Olint, another investment club.

"After doing my research about Forex (foreign-exchange trading), and reading of its potential, I was convinced," the woman, who asked not to be named, told The Sunday Gleaner. "I came down to Jamaica, went to their office in New Kingston and interviewed the operations manager. I felt comfortable. I went home to New York, went to my bank and wired down the money to (a commercial bank) New Kingston."

However, when she attempted to open an account with Olint, she was told that the club was no longer accepting new members due to a cease-and-desist order that had been placed on it by the FSC.

"I was crestfallen. I discussed my problem with a close friend... I was also told that there was another company (Cash Plus) that was building confidence among the Jamaican people. Its monthly return was timely and it was investing in foreign exchange, too. I signed up with them to have the 10 per cent of my money sent to a local bank. After several months of getting this return, my confidence built. I wired more money down to Jamaica and put it in Cash Plus. I also reinvested everything that I made back into the company," she says.

Other cases

The investor says she knows at least 20 other Jamaicans who had taken the risk of investing in the company, many of them professionals. She claims that at least one woman lost US$1 million and several other members of her family also lost millions.

"I haven't been able to send any money back home since December," she discloses.

President of the Jamaican Diaspora Foundation in Canada, Philip Mascoll, says he knows at least five people who also invested in the scheme. The figure is much higher he believes, but is not really known because people might be embarrassed by the loss.

"They invested anywhere between CDN$1,200 and CDN$10,000," he estimates.