KINGSTON — Mandeville businessman, Michael Levy, Thursday (February 17), denied that he signed on to a 55 percent interest rate on a $4 million loan from Eagle Commercial Bank in 1992, which ballooned into his over $1 billion indebtedness to the Jamaica Redevelopment Foundation (RDF) Inc. in 2008.
Attorney for JRF, Sandra Phillips, while cross examining Mr. Levy, as the Commission of Enquiry into the 1990s financial meltdown and the Government’s intervention through FINSAC continued at the Jamaica Pegasus Hotel New, Kingston, suggested that the debtor had signed a document agreeing to the 55 percent interest rate with Eagle in 1992, which he later accused JRF of imposing.
“I would be a mad man to agree to that,” Mr. Levy reacted.
Mrs. Phillips denied that JRF restructured the interest agreement on Mr. Levy’s loan. She told JIS News that debtors were given an option to negotiate a restructuring of the terms of their loans by the JRF, but Mr. Levy was not among those who took up the offer, and the original interest rate was kept intact.
The issue was triggered by Mr. Levy’s revelation that he had taken the Government to court, for allowing JRF to charge him a 55 percent interest which, he said, was illegal.
On Wednesday, Mr. Levy had informed the Commission of the $4 million loan he obtained from the now defunct Eagle Commercial Bank. He said that although he repaid over $20 million by 1997, he was told that he owed JRF, which took over the bad debts, over $1 billion in 2008. This resulted in the sale of his Bankhouse Mall, Manchester Road, Mandeville.
He said, at the time, the Mall had about 40 tenants paying monthly rent amounting to between $900,000 and $1 million. However, he received none of this money after it was taken over, and his staff and effects put out.
But, Mr. Levy, has been unable to produce a number documents requested by the Commission to support his contention. He has admitted to signing a number of blank documents. His lawyer, Rafael Codling, says he is still hoping to retrieve some of the documents from former lawyer, Anthony Pearson.
Mrs. Phillips produced documents to show that JRF has been compliant with business laws in Jamaica, as well as in Texas where it has its headquarters.
The members of the Commission are accountant Worrick Bogle, who replaced Justice Boyd Carey as chairman earlier this year, retired judge, Justice Henderson Downer, and investment manager, Charles Ross. The hearings resume Tuesday morning at nine at the Jamaica Pegasus Hotel, New Kingston.
By BALFORD HENRY, JIS Reporter & Editor