The head of the suspected pyramid scheme Banners Broker has tried to reassure worried investors that there is still money in the company and that it has moved operations to the Central American country Belize.
Canadian Chris Smith said the liquidation of its Isle of Man firm was a “pesky situation” that would further delay promised payouts. But he said the $6m frozen on Wednesday was “more of a rainy day trust” which it had not needed.
Mr Smith’s made his online video address a day after a court in the Isle of Man appointed joint liquidators to Banners Broker International Ltd.
But the company’s former contractor in Britain, who Mr Smith blamed for forcing the liquidation, described BBIL’s argument as “utter hogwash”.
Ian Driscoll, who said he left the company in 2012 when he sensed something was not right, said, if there was a surplus $6m sitting in an account, why had investors not been paid what they were due.
Mr Driscoll, who this month took a multi-million dollar claim against BBIL for breach of contract, told the Irish Examiner, if there were funds moved to Belize, the liquidators and creditors would unlock them. Mr Driscoll said the case did not go ahead because of the decision of BBIL’s nominated shareholder, Targus Investments, to put the company into liquidation.
Twelve thousand Irish investors had money in Banners Broker. They stand to lose heavily as they will be vying with creditors from around the world for a share of the frozen $6m.
In his web address Mr Smith claimed BBIL had been looking to wind down the Isle of Man company of its own accord.
An Isle of Man judge appointed joint liquidators after deciding BBIL needed to be wound up in the interests of justice.
Mr Smith confirmed it had no presence in the Isle of Man besides an unused bank account which it now cannot not access.
During his web presentation Mr Smith presented paperwork to show it incorporated a company, also called Banners Brokers International Ltd, in Belize last July. He said it was in the process of moving funds from the Isle of Man. However he said its efforts to shift the money had been frustrated by a legal case taken by Mr Driscoll, who he said was seeking $3m in unpaid profits. That hearing took place on the Isle of Man in early February.
Mr Smith said as Mr Driscoll was linked to the Isle of Man account BBIL could not get the money off the island in time. “We are now not able to release these funds that we wanted to,” he said.
But he said creditors who had made applications to the court in the Isle of Man would not get money from BBIL. “Nobody on that creditors’ list will be paid anything whatsoever.”
He said Banners Broker insisted on an internal dispute resolution system for affiliates and he warned investors it would not entertain court challenges.
Mr Smith told investors who had signed into the web address that an account of the liquidation hearing was available online at the Irish Examiner but that this newspaper had sensationalised the court judgment.
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