Globe Trust and Investment Company Limited (GTICL) liquidator Nizam Ali will soon move against debtors of the bankrupt institution that have been reluctant to repay, signalling a fresh round of court battles as the institution seeks to cover its liquidated expenses.
Since acting Chief Justice Ian Chang ordered the compulsory liquidation of the company last month no debtor has come forward, but some depositors have surfaced with the hope of being reimbursed. Reports are that the liquidators are being approached everyday.
Nizam Ali told Stabroek News yesterday that he is considering moving against debtors to reclaim funds, while pointing out that Globe Trust is already in court over outstanding balances. However, he noted that the liquidation process can only move forward if the monies are repaid. Therefore, a move to the court is imminent. “The court process can be protracted and we could be tied up there for years fighting to reclaim money but Globe Trust is not in a position to refund depositors and cover other expenses if these monies are not back with the company,” Ali explained.
Ali also said letters have already gone out to depositors seeking confirmation of their balances and to date, a few persons have responded. The liquidation process is now at the stage where the company’s assets are being realised. Ali explained that all of Globe Trust’s assets would have to be disposed of, and these include vehicles and furniture among other items.
He frankly stated that the liquidation would take in excess of a year, adding that his intention was to have the process completed in a year. “It would not be remotely possible to have this over in a year based on what is happening,” Ali said.
He further disclosed that depositors have been approaching him everyday after he was formally appointed liquidator enquiring about their payments.
Last month, Chang issued an order for the compulsory liquidation of Globe Trust following a High Court application by the Bank of Guyana (BoG).
The company came crashing down after issuing many unsecured loans among other dubious practices. The BoG filed an application asking that an order be granted for the compulsory liquidation of GTICL as provided for under the Financial Institutions Act after an investment deal for the troubled institution failed to materialise. It was the second such application-the first was filed in 2002. In 2002 numerous depositors had attempted to intervene in the case.
Globe Trust began operating in April 1991 and was licensed in 1999 to conduct depository financial business with authority to engage in trust business. However, in 2000 and 2001 a series of inspections by the BoG found the institution to be in breach of the Financial Institutions Act, and the BoG, with the intention to liquidate, seized the institution in September 2001.
Several attempts thereafter to attract an investor failed. Stabroek News was told that close to 87 investors had expressed an interest, but that no serious attempts were ever made to follow through with proposals.
The most recent potential investor promised to inject funds into the institution but did not do so.
