business@tribunemedia.net
FRIDAY, NOVEMBER 18, 2022
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Bahamas debunks claims Gov’t gave ‘unauthorised’ FTX access By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
• Hack forced relocation of local subsidiary’s assets • Commission obtained Supreme Court’s approval • Chapter 11 filings allege Gov’t violated Orders
The Securities Commission last night debunked accusations the Government “directed unauthorised access” to FTX’s systems, and aided the withdrawal of digital assets, in violation of Bahamian and US court orders. Tribune Business has seen an emergency Supreme Court Order, dated November 12, 2022, that gave the regulator lawful permission to transfer assets potentially worth millions of dollars from FTX Digital Markets, the failed crypto exchange’s Bahamian subsidiary, to “a safer space” amid fears they were about to be stolen by hackers. The Order, by Justice Loren Klein, completely rebuts allegations made by John J. Ray, appointed as FTX’s chief executive in the wake of its Chapter 11 bankruptcy protection filing, that he possesses “credible evidence that the Bahamian
government is responsible for directing unauthorised access to the debtors’ [FTX’s] systems for the purpose of obtaining digital assets” held by the exchange on behalf of clients. However, the potential damage to The Bahamas’ integrity and allegations from such unproven claims may now be hard to reverse. International news outlets, such as CNBC and Coindesk, were already yesterday reporting Mr Ray’s allegations and suggesting that FTX’s now-infamous founder, Sam
Bankman-Fried, sought to hide assets from the Chapter 11 proceedings in Delaware by transferring them to Bahamian government control. The Davis administration, which has been seeking to place as much distance as possible between itself and the flagship digital assets investor it once warmly embraced, declined to respond to the FTX-related claims despite the high risk of damaging fall-out for the Government, fledgling digital assets industry and wider financial services sector. Clint Watson,
the Prime Minister’s press secretary, said: “We have no comment at this time.” The Government, instead, once again left the response to the Securities Commission as it moves to disassociate itself from FTX. However, the Prime Minister’s assertion that The Bahamas will emerge from the crypto exchange’s spectacular implosion with an improved reputation as a sound digital assets jurisdiction now looks set for the severest of stress tests due to the erroneous accusations. Well-placed sources, familiar with how events unfolded but speaking on condition of anonymity because they were unauthorised to talk publicly, said the Securities Commission was last weekend “really in a race against time” to secure and protect FTX Digital Markets assets for the benefit of clients and creditors. They explained that the regulator had no choice but to
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FTX’s Bahamas creditors unlikely to see full recovery By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net FTX’s newly-appointed chief executive yesterday asserted that corporate governance was non-existent at its Bahamian subsidiary, adding: “Never have I seen such a complete failure of controls in my 40-plus years.”
John J. Ray, who almost two decades ago oversaw the bankruptcy of Enron, the energy trader whose failure sparked global accounting and corporate governance reforms, also took a thinly-veiled swipe at this nation by referring to “faulty regulatory oversight abroad” of the collapsed crypto currency exchange. And, in legal filings with the Delaware Bankruptcy Court,
he also alleged that FTX used corporate funds to acquire Bahamian real estate for its senior executives but placed these assets in their name - not the company’s. No details were provided. Meanwhile, Brian Simms KC, the senior Lennox Paton partner who has been appointed joint provisional liquidator of FTX Digital
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$250m cruise port: ‘We’ll help Long Island flourish’ By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE proposed $250m Long Island cruise port will handle up to 12,000 persons daily at full build-out, one of its principals revealed yesterday, adding: “Our goal is to help Long Island flourish.” Sherif Assal told the Long Island Business Outlook conference that the $250m Calypso Cove project is “not a cruise line project” or typical private island destination, and pledged: “Our objective is not to suppress the locals; it’s to help the locals.” Reaffirming that Long Island residents will have first eights to all job and
entrepreneurial opportunities, he added that a “ball park” date for the development’s initial opening was some two-anda-half to three years away in November 2025. Much depends on how rapidly planning, construction and environmental approvals are obtained, with much to be worked out from a logistics and infrastructure standpoint since it is a “greenfield” site. Asserting that plans to raise the necessary financing are “coming along very well”, although providing no details, Mr Assal explained how himself and his business partner, Carlos Torres de Navarra, a former
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Long Island’s to airport is branded ‘a disgrace’ By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net LONG Island’s chief councillor yesterday branded the Deadman’s Cay airport “a disgrace and leaves much to be desired” as the lack of airlift and connectivity continues to undermine the island’s economic prospects. Ian Knowles, addressing the Long Island Business Outlook conference, voiced hope that the impending $250m Calypso Cove cruise port and other potential investment projects will give the Government little choice but to finally move on transforming the airport
into a facility capable of receiving commercial jet flights and direct international airlift connectivity. “The international airport at Deadman’s Cay has been the talk of the town for the last five years, and even after being presented with plans several years ago we still remain hopeful,” Mr Knowles said. Besides being unable to presently receive commercial jet flights, he added that Long Island has to share Bahamasair routes with other islands and there are “no direct flights from any international market”.
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Gov’t investment chief: ‘We must regain people’s trust’ • Bahamas needs ‘meaningful investment beyond jobs’ • $660m in Long Island projects ‘processed’ post-election • BIA targets ‘joint venture’ promotions for each island By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE GOVERNMENT’S investments chief yesterday admitted it has “a lot of work to do in regaining the trust of the Bahamian people” while revealing that some $660m worth of projects are on the drawing board for Long Island. Phylicia Hanna-Woods, the Bahamas Investment Authority’s (BIA) director, told the Long Island Business Outlook conference that the agency had to prove it is “not Nassau centric” and attract “meaningful investment” that translates into real projects with economic benefits that extend beyond the mere creation of jobs. She added that the BIA is also focusing on what she termed a “joint venture” promotion strategy, and is seeking to partner with each individual Bahamian island to “showcase” their respective needs, qualities and culture to potential investors. Mrs Hanna-Woods said that, apart from the $250m Calypso Cove cruise port project for which a Heads of Agreement with the Government was signed recently, the BIA is also negotiating with investors seeking to redevelop the former Diamond Crystal property via a $410m, three-phase spend. Pointing to the Long Island-related investments processed after the Davis administration took office, she said: “To-date, since September 2021, and I took on the position of director in October 2021, we’ve processed $660m worth of investments, one of which you’ve heard a lot about, Calypso Cove.
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