Ennis says Olint raid was vulgar abuse of state power
Published by www.jamaicaobserver.com on Jan 24, 2007
Jan 25, 2007

Ennis. getting rich quickly was never a crime

Government junior minister and parliamentarian Errol Ennis has blasted the state-run Financial Investigation Division for what he said was its "Gestapo-like invasion" of David Smith's Olint office last year, describing the raid as "a vulgar abuse of state power and highly reflective of the actions of a totalitarian state".

Ennis, a state minister of agriculture, also said in a letter to the Observer that the raid was designed to destroy Smith's high-interest investment club which, he said, should instead be encouraged "as a possible boon to the Jamaican economy, although it has some inflation impact".

Ennis's letter comes a few days after his colleague, Finance Minister Omar Davies, warned people who put money in alternative investment schemes that they were doing so without the protection of the state.

Following is the full text of Ennis' letter.

Dear Editor,
The Gestapo-like invasion of David Smith's office last year as conducted by the Financial Intelligence Arm of the Financial Investigation Division was a vulgar abuse of state power and highly reflective of the actions of a totalitarian state.

It was designed to destroy both the company and the man's reputation in one fell swoop. It was even more frightening, given that to date, no clear statement has emerged as to the exact legal infringement committed by the company. The "Cease and Desist" order served on the company was somewhat akin to brute force when it was clear that the intended effect of the raid, to create a run on the company's office, did not materialise.

Foreign exchange trading is the largest trading platform in the world, many times larger than the stocks and shares markets in the world when combined, larger than all the commodity markets in the world.

There are many large and small companies, larger trading houses and millions of individuals trading 24 hours per day, six days per week in the Forex Market. Tremendous trading expertise, aided by modern technology, are the critical tools to be successful in the market. Huge losses and huge gains are the trademarks of this most volatile market. If the greed factor can be tempered, then steady profits can be generated.

To the individual trader of small investors with Olint Corporation, the Forex Trading Market is their period of financial enlightenment, releasing them from the hegemonic control of the high priests of the financial clergy. The traders are enjoying an economic renaissance, freed from the controls of the financial institutions. The invasion of Olint's offices was, therefore, nothing more than the action of a bunch of economic luddites, scared and uncertain of a bright new world.

It is difficult and near impossible for any rational and sensible investors to accept a rate of return on their investment of 8% - 10% per annum, when they could earn as high as 60% - 120% in the same period. Admittedly, the risks are higher, but fully consistent with fundamental capitalist dictum: "The higher the risk, the higher the profits". Indeed, there has always been a direct and positive relationship between the level of risk and the level of profits.

The protection of the club members as claimed by some, though on the surface laudable, would best be directed at the manifest manipulation of other investment markets that go on daily in the Jamaican economy, to the clear detriment of the small man.

There were expressed fears that the success of Olint/David Smith, would lead to capital flight. Olint's operation initially involves movements out, but it also involves a compensating inflow of foreign exchange. Any detailed analysis of the company's operations would have clearly shown these trends:

1 The club members were prepared to be exposed to a high degree of risk for the first year, in which time they could double their investment;

2 The club members were repatriating their risk capital to the low performing financial sector within a year, so as to average out the level of risk to their investment portfolio;

3 The capital reflows were actually equal to greater than the outflows:

4 The earnings were tantamount to export earnings with no indexed outflow after the repatriation of the initial capital investment;

5 The club members were largely relative small investors with no significant capacity for parking their money in off-shore accounts as is the norm for so many of the traditional large investors; and

6 That Olint's aggregate earnings and foreign exchange reflows had reached over US$3 million weekly and peaked to over US$7 million in the November - December period.
Olint's operations and other traders should be encouraged as a possible boon to the Jamaican economy, although it has some inflation impact. For me, it is a preferred trading activity to the Stock Market, as present conducted in Jamaica. In any case, there is no way to prevent anyone from trading on the Forex Market. There are some who have attempted to use the economic, social and political clout to bash Olint's operations.

There is no crime in using honest means afforded by today's technology, coupled with specialised skills to afford many Jamaicans to get "rich quicker". The alternative is putting their money in the banks and financial institutions and watch others get richer and richer, while their own returns are a measly 8% per annum, below the rate of inflation. In any event, getting rich quickly was never a crime.

The hundreds of small investors were not cowed and intimidated by the FSC's attempts to destroy Olint Corporation and David Smith and, by extension, to destroy their economic prospects. The Forex Trading Market has afforded new, young, non-traditional players to parade their skills and help a lot of small Jamaicans to have their days in the sun and to help them reach their goals.

David Smith, may God continue to shower many blessings on you and Olint. We the children of a lesser god depend on you to help us get rich.

David Smith, don't stop at all...