Globe Trust liquidator Nizam Ali said the “beginning of the end” is approaching for the failed institution as he will soon file the required Schedule of Steps in court, which signals the process is wrapping up and places depositors on notice.
The Schedule of Steps was expected to be filed in court by June 12, 2010, a date Ali secured after seeking an initial extension. However, it is set to be filed in September this year, since the liquidator said he needs more time to have a few related matters concluded. “There are still matters in court and we are hoping to finalise several other court-related matters including having the transport passed for properties which were sold,” Ali said Monday. He told this newspaper the new extension buys some time and allows several of the things to be wrapped up by that period. He explained that by filing the Schedule of Steps the court is placed on notice as to what the steps are in terms of settling matters related to the company.
Ali said the Schedule of Steps is important because it sets out what monies can be paid back and to whom. He said payments are required to be made in accordance with the laws, noting that small depositors are likely to get something back when the time approaches. He said depositors with amounts under $100,000 would be given priority in keeping with the requirements. “They are looking good,” he said of the small depositors.
Depositors with amounts exceeding $100,000 might receive a small percentage back, according to Ali. He said the bigger pay-outs happen after the small depositors are cleared. “It is not equitable, but that is what the law says,” he added. Ali said Globe Trust still has many matters tied up in court where many large sums are still to be recovered.
The majority of Globe Trust and Investment Company Limited (GTICL) former directors are in court defending claims filed against them for monies owed to the institution. The company is claiming close to $20 million in monies to be recovered from each director, and in the case of the former chief executive officer of the company some $35 million. There is at least one other director who the company says owed in excess of $20 million. In addition to the directors, Globe Trust has moved to the court against other debtors in an attempt to reclaim some of the $750 million handed out in unsecured loans. The matters are all being vigorously defended.
In October last year, Chief Justice (ag) Ian 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 after which numerous depositors had intervened.