JRF being used as a “scapegoat”, CEO tells FINSAC Enquiry

KINGSTON — Chief Executive Officer (CEO) of the Jamaica Redevelopment Foundation Inc. (JRF), Jason Rudd, claimed on May 17 that his company, which acquired the FINSAC bad debts in 2002, is being used as the “scapegoat” for the 1990s financial collapse  and the bad debt crisis it triggered.

“I have closely followed the hearings of this enquiry, and have tried to study various reports and opinions as to how the financial collapse came about, and I have also tried very hard to understand how JRF has become the scapegoat in this situation,” Mr. Rudd read from his Witness Statement to the FINSAC Enquiry, at the Jamaica Pegasus Hotel, New Kingston.

In an interview with JIS News after his presentation, Mr. Rudd explained that his claim was based on the view that the Commission has been sidetracked from its primary issue. He suggested that the most important issue for the Commission to determine is what could have been done, on a broader economic policy level, to prevent the financial crisis from occurring. However, he said the Commission has digressed  into investigating “the business practices of JRF", and the JRF is being blamed for the hurt the borrowers have felt.

“Solving those pains will not prevent a meltdown, any way. If the economic issues that were alleged to have caused the problem aren’t addressed and aren’t solved, the role that JRF plays will be of no point,” he stated.

Mr. Rudd told the Commission that JRF, as an investor in the Jamaican economy, is deeply interested in, and concerned about the success of Jamaica’s economy and its people.

“The problems facing the Jamaican economy are real and substantial. However, the problems facing Jamaica were not caused by JRF, and JRF should not be blamed for them,” he told Commissioners Worrick Bogle and Charles Ross.

Mr. Rudd explained that while JRF is an American-owned company, it is domiciled and registered in Jamaica as a company incorporated externally, but carrying on business in Jamaica.

He said that JRF has paid in excess of US$70 million to the Jamaican Government, for the non performing loans it acquired from the Financial Sector Adjustment Company (FINSAC) and its related entities in January, 2002. He added that JRF continues to pay for the portfolio, via returned funds to the Jamaican government through the entities under the relevant agreement.

He said that, in addition, JRF has reinvested “countless sums” in the economy, by way of contracting the services of accountants, appraisers, attorneys, consultants and security and transportation companies, as well as through its staff of some 23 persons.

The JRF boss was not cross-examined Tuesday, as Chairman Bogle said that Mr. Rudd’s statement was only received Monday night, and neither the commission nor the attorneys had enough time to study it. Mr. Rudd is expected to return after the enquiry resumes on May 30.

By BALFORD HENRY, JIS Reporter