Guyana Stockfeeds unfairly targeted by Securities Council - says Robert Badal

Guyana Stockfeeds unfairly targeted by Securities Council – says Robert Badal

Mar 30, 2014 News

The makers of animal feed, Guyana Stockfeeds Inc. (GSI), have blasted the Guyana Securities Council (GSC) on what the company says is a delay to retract an erroneous advisory which placed that company in a bad light over the payment of dividends.
GSI, in a strong statement Friday from its main principal, Robert Badal, now believes that the delay does not rule out conclusions that the regulator is unfairly targeting the company.

Robert Badal, Managing Director, Guyana Stockfeeds Inc.

According to Badal, the Guyana Securities Council issued a “Public Advisory” in the national media which stated that his company had published its Interim Report for the period January – June 2013 showing that GSI had paid dividends totaling $80,285,557 for the 2012 Financial Year.
The regulator claimed that it had been notified by several shareholders that they did not receive any dividend payments for that period. The council also claimed in the notification that it contacted the feed company, which is headquartered at Farm, East Bank Demerara, and was advised that no dividends were paid for 2012.
The public advisory also said that GSI was written to warning that the January–June Interim Report was incorrect and steps have to be taken to reverse this. However, at the time the advisory was published in the media, GSI had not corrected this.
The council also advised shareholders to seek independent advice.
According to Badal, his company had written the regulator on January 20, insisting that although it had approved dividends for 2012, it was not actually paid to shareholders. As a matter of fact, one “disgruntled” shareholder – the Government-owned National Industrial Commercial Investments Limited (NICIL) had approached the courts for an injunction to restrain payment of the dividend.
“This injunction was discharged for material non-disclosure on the part of NICIL. Some time after, NICIL again obtained an injunction restraining the payment of dividends which GSI is seeking to have heard. Meanwhile, out of respect for the court, GSI has not actually disbursed the approved dividend payments to shareholders.”
The businessman said that GSI sought professional advice on the GSC’s request for a correction of its Interim Report and was told nothing was wrong.
The feed company, which is part of the group that also owns controlling interest in the Pegasus Hotel, called for the retraction, especially in light of the “potential harm it posed to GSI’s business”
However, the company does not believe that GSC has any intentions to publish the retraction. “GSI is very disappointed that the GSC as a regulator would behave in such an irresponsible manner. Even if it had received complaints from shareholders, the GSC’s rush to press was unwarranted. It could simply have directed shareholders to contact GSI’s offices, which would have provided them with the information above. Or it could simply have advised the shareholders to do what it ended up doing at the conclusion of its advisory anyway – to seek private professional advice.”
GSI wondered if the actions by the securities council and its refusal to correct may not have been deliberate. It may lead observers to conclude that the GSC and its officers were mischievous. “In some jurisdictions this would have led to calls for an apology by the GSC and the resignation of its C.E.O.”
The company added out that there are cases where others with serious transgressions are treated differently…”It (GSI) may be excused from forming the perception that there is a campaign of harassment by this regulator, directed at the company.”
The statement also blasted the seeming inaction by the GSC to become involved in the CLICO debacle, when that insurance company marketed what was a security disguised as an insurance policy, to the unsuspecting Guyanese public without registering same with the GSC, or publishing a prospectus.
This “behaviour” caused financial carnage among Guyanese investors, including the National Insurance Scheme, and could have been easily prevented had the GSC been minimally vigilant. “Again, in other jurisdictions, this may have led to the resignation of its C.E.O. Another public company, Property Holdings Inc., administered by Mr. Winston Brassington of NICIL had been in breach of the Companies Act for several years in failing to file Annual Returns as required by the Act.”
The feed company said that one would have thought this may have provoked a similar “advisory” from GSC.
“…However, again, its uncharacteristic shyness prevented it from taking any action. Despite the apparent attitude of the GSC, GSI nevertheless invites it to issue a retraction, belated as this may be.”