The Opposition People’s National Party (PNP) is calling for Auditor General Pamela Monroe Ellis to conduct a special audit of the operations of the Financial Services Commission (FSC). 

In a statement today (January 20), the Opposition said its call comes against the background of what it termed the apparent inaction of the FSC in addressing issues at Stocks and Securities Limited (SSL) after its own damning report of 2017 which highlighted widespread breaches and irregularities at SSL.

The regulatory body is currently facing public backlash over its perceived failures in conducting oversight of SSL and after a press conference Wednesday (January 18) at which FSC officials dodged questions around the ongoing scandal.

“The purpose of this audit would be to determine the effectiveness and propriety of the decision-making functions and conduct within the FSC in carrying out its statutory mandate,” the Opposition said.

The Opposition stressed that the inspection should include examining the relationship between staff and the Board in relation to the regulatory performance of the entity.

It also stated that the audit should have regard to the FSC’s conduct with respect to other entities where regulatory actions have been taken. 

“The audit should make recommendations about the appropriateness and competency of the FSC’s past and present board of directors, and the adequacy and appropriateness of the FSC’s staffing and technical expertise, with the aim of ensuring that the FSC is carrying out its regulatory oversight functions effectively with respect to the non-deposit taking financial sector.”

The Opposition noted that it is critical that all efforts are made to restore public confidence in the capacity of the FSC to provide regulatory oversight in the financial services industry.

It also said there are questions that the public needs answers to.

1. What recommendations were made by the FSC for implementation by SSL after the 2017 report?
2. Were these recommendations implemented?
3. Were there follow-up audits of SSL by the FSC to ensure compliance with the directions issued?
4. Were actions recommended by the staff of the FSC that were not supported by its Board?
5. Why did the FSC fail to take appropriate regulatory enforcement measures in a timely manner given SSL’s history of serious breaches, within the context of actions taken (including the revocation of licences) against other entities where breaches were identified?

The Opposition is also calling for the Government to solicit international forensic expertise as a matter of urgency, to supplement and support the work of local law enforcement agencies such as MOCA and the FID.

Specifically, forensic accounting and cybersecurity expertise should be engaged. 

This must be done now to ensure that funds stolen from customers of SSL can be traced and recovered from wherever they may be, and to restore the reputation of Jamaica’s financial sector which has been tarnished by the massive and prolonged fraud at SSL.