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TUESDAY, SEPTEMBER 19, 2023
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ArawakX hit by claim of ‘criminal infraction’ t $SPXE GVOE QMBUGPSN ABU MFBTU N JOTPMWFOU t $IBJS EFmBOU A8F JOUFOE UP SFGVUF FWFSZUIJOH t A'VOET NJTVTFE TUBGG VOQBJE JTTVFST PXFE ù
By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE Bahamas’ first-ever crowd-funding platform has a solvency deficiency of “at least $2.4m”, regulators charged yesterday, while accusing it of “governance irregularities, regulatory breaches and possible criminal infractions”. The Securities Commission, in legal documents filed with
Petroleum dealers ‘won’t force Govt’s hand’ despite $100 oil By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net BAHAMIAN petroleum retailers yesterday conceded their margin woes “cannot easily be fixed overnight” and promised “not to force the Government’s hand” with oil prices currently on track to reach $100 per barrel. Vasco Bastian, the Bahamas Petroleum Retailers Association’s (BPRA) vice-president, told Tribune Business that negotiations with the Davis administration are “requiring more time than we had all anticipated” to reach a resolution but dealers were willing to be patient given the wider challenges that the country is facing. With global oil prices forecast to soon reach $100 per barrel again, due to a combination of rising Chinese demand and production cuts by Saudi Arabia and Russia, two major producers, Bahamian petroleum retailers are
once again faced with the prospect of having to pay an increasing amount to purchase their fuel inventories. With the industry’s pricecontrolled fixed margin structure ensuring retail and wholesale margins do not change, regardless of pump prices, retailers often have to incur increased overdraft, credit card and other bank-related fees to cover the increased outlay on fuel inventories. Mr Bastian, though, told this newspaper that retailers may adjust to these pressures by reducing the quantity of fuel they purchase so as to contain costs and avoid increased overdraft and other fees. “The current model is what it is. There’s nothing we can do,” he explained. “It’s a global trend. Oil prices are increasing all over the world as a result of the reduction in output by Saudi Arabia and Russia. “It will definitely have an impact on the gas station
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PM unveils $500m climate finance plan By Fay SIMMONS Tribune Business Reporter jsimmons@tribunemedia.net THE PRIME Minister yesterday unveiled ambitions for The Bahamas to raise $500m to bolster its resiliency, and sustainability, against negative climate change impacts in partnership with Resilience Capital Ventures. Philip Davis KC, unveiling the Bahamas Sustainable Investment Programme at the Clinton Global Initiative forum, said: “With our strategic advisors, Resilience Capital Ventures, we will work with regional and global capital market leaders to underwrite and place an innovative financing
facility with a target of $500m. “Our priorities include climate-resilient infrastructure, our clean energy transition, coastal zone conservation, reducing biodiversity loss, regenerative agriculture, carbon sequestration,and participation in natural asset-backed carbon credit programmes. Blended finance is a smart way to close the climate financing gap at a time when solutions cannot be postponed.” Mr Davis explained that The Bahamas is in “urgent need” of climate financing solutions as it is still reeling from the financial impact of four major hurricanes and has difficulties accessing
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the Supreme Court, asserted that these woes are sufficiently “insurmountable” to justify ArawakX’s winding-up amid allegations that investor funds were “commingled” with those belonging to the company; staff had not been paid for “several months”; and capital-raising companies had not received all monies due to them because these were being misused to fund the platform’s operations.
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CHRISTINA ROLLE
D’ARCY RAHMING SNR
D’Arcy Rahming senior, ArawakX’s chairman and chief executive, last night told Tribune Business that “we intend to refute everything” as he vehemently denied the Securities Commission’s allegations against himself, his son, D’Arcy Rahming junior, and the crowd-funding platform itself (see other article on Page 2B). He declined to provide much detail ahead of ArawakX’s legal response to
the Bahamian capital markets regulator, which is due to be filed with the Supreme Court by September 25, but the documents released by the Securities Commission give a completely different perspective to the two sides’ year-long battle than that already provided by the crowd-funding platform. The regulator, in its petition for ArawakX’s winding-up
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Crowd-funder: From $4m to $200m in 14 months By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE BAHAMAS’ first-ever crowd-funding platform purportedly increased in value from just $4.38m to an astonishing $201.75m in just 14 months, it was alleged yesterday, despite accounts revealing a $2.659m “deficit” at end-July 2022. The Securities Commission, in documents supporting its Supreme Court petition to windup ArawakX, revealed it was “gravely concerned” the company had “made representations about its valuation” to prominent Bahamian investors without supplying any evidence to back such numbers. Among those induced to invest in ArawakX, and who parted with “substantial sums”, were prominent physician, Dr
t %FTQJUF N AEFmDJU BU FOE +VMZ t 1SPNJOFOU #BIBNJBOT BSF NBKPS JOWFTUPST t 7BMVBUJPO $PNNJTTJPO AHSBWFMZ DPODFSOFE Harold Munnings, Lynden Johnson and Burchinald Gibson. The trio were named in an August 30, 2023, letter from Christina Rolle, the Securities Commission’s executive director, to D’Arcy Rahming senior, ArawakX’s chairman and chief executive, in which she said such investments had failed to obtain the regulator’s prior approval in accordance with the law.
“The Commission is gravely concerned that MDollaz has, in order to support its share offer prices, made representations about its valuation to investors such as Dr Harold Munnings but without providing any internationally acceptable process for valuation,” the Securities Commission chief wrote. “This lack of process renders the valuation highly questionable at best, and raises the possibility of misrepresentation.” Given that ArawakX was only registered to conduct business as a crowd-funding marketplace on January 18, 2021, the jump in its purported valuation from $4.38m to $50m and then, latterly, to $201.75m is likely to raise eyebrows especially since it was in its fledgling start-up growth phase and has only handled a few issues to-date.
The Securities Commission doubled down on such concerns in its winding-up petition, filed with the Supreme Court yesterday, in which it revealed that 134 of the 136 alleged “shareholders” in ArawakX had not been approved as investors as required under the Securities Industry Act. The only two with such permission were Mr Rahming senior and his son, D’Arcy junior, who were both shown as holding equal 50 percent equity stakes when it it began conducting business. “This was the first time the Commission became aware that the number of shareholders exceeded the threshold of a private company,” the capital markets regulator disclosed. ArawakX’s largest investor appears to have been former Colina Insurance
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‘Room for improvement’: Trade deficit expands 28% to $1.09bn By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE BAHAMAS Trade Commission’s chairman yesterday said “there’s a lot of room for improvement” after this nation’s trade deficit expanded by almost $184m or 28 percent yearover-year to hit $847m in the 2023 second quarter. Philip Galanis, who declined to comment in detail given that he had yet to see the latest quarterly trade report from the Bahamas National Statistical Institute, told Tribune Business: “Generally we’re heading in the right direction in terms of trade, although there’s a lot of room for improvement and we have to understand how much of that increase was fuelled by inflation.” The trade deficit, which only measures by how much imports of physical goods exceed the value
PHILIP GALANIS of exports, and excludes services, expanded from a negative $663.025m for the three months to endJune 2022 to $847.021m during the same period this year. Goods imports increased by 35 percent year-over-year, surging by $284m to $1.094bn during the 2023 second quarter compared to $809.764m the year before. Oil imports played a major role, their value more than doubling or increasing by over 100 percent
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