‘We have to do something different’
Clarke signals private sector will be tapped to help dispose of forfeited assets
SOME $2 billion in assets that have been forfeited and are now being held by the Financial Investigations Division (FID) could come to market in due course with a proposal to have private sector companies dispose of the assets instead of the Government. The proposal was made by Finance Minister Dr Nigel Clarke in the opening presentation of the 2024/25 Budget Debate.
Clarke outlined to the House of Representatives on Tuesday that the FID currently manages a portfolio of 118 real properties with a combined market value of $2.6 billion.
“Sixty-seven real properties with an estimated market value of approximately $2 billion dollars have been forfeited by the Courts. Of the 67 forfeited properties, 26 with an estimated market value of $685 million are the subject of foreign forfeited orders and the proceeds of any sale will be subject to the asset sharing agreement. The remaining 41 properties valued at $1.2 billion were forfeited pursuant to the domestic Proceeds of Crime Act.”
He added that 51 properties with an estimated market value of $682,834,491.00 are currently restrained by the courts and noted that the value of all the assets could be much higher, given that they were last valued between 2018 and 2022.
However, he said disposing of the assets has been a challenge.
“The numbers are a little confusing, but the point I want to make is that there are a lot of property that’s been seized that is under the jurisdiction of FID, and I want to tell you about the challenges that we are facing, and we need to do something about it, because these are resources that belong with the Jamaican people,” Clarke said as he signalled that changes will be made to how the assets are disposed to speed up the process.
“From 2012 until 2024, spanning several Administrations, only three properties valued at $108 million have been sold to date. Madam Speaker, this is not acceptable. Our partners who grant Jamaica significant resources to assist in our national security efforts, look on and say ‘Look, you have all these assets sitting on that you are not turning into resources to assist the Jamaican people.’ We have to do something different. The process of getting the Government as the sales agent is not working, Madam Speaker, and despite the best efforts, over that 12-year period, Madam Speaker, what we are doing is spending hundreds of millions of dollars, maintaining the properties. We spend $150 million over the last 12 years, maintaining this portfolio of properties,” he added, his voice trailing off before adding: “It don’t make any sense. So what we want to do, Madam Speaker, is that we intend to engage, Madam Speaker, with private companies of professional realtors in keeping with the procurement rules, to market and sell the portfolio of properties, either collectively or individually.”
He said the FID is working across Government to look for ways to solve this problem, and said when the solutions are crafted, he will return to the House to present the way forward, though he did not give a timeline. The average disposal process of forfeited properties takes up to three years.
During the period 2012 to present, 29 properties valued at $750 million were submitted by FID for advertisement and sale. To date, only three of the properties valued at J$108 million have been sold. Clarke said despite the FID’S best efforts in securing and maintenance the properties, a few have been vandalised, burglarised, and are depreciating through normal wear and tear.
He said the country faces the same challenges when it comes to cash seizures.
“In addition to the real properties on the books of the FID, the department is also managing the proceeds of over 800 cash seizure cases pursuant to the Proceeds of Crime Act...the aggregate value of the cash seizure cases is approximately $1 billion (comprising US$4.5 million, J$108 million, £220,000, €220,000, and CAD370,000).”
He said the majority of the cases, over 600 or 75 per cent of the total number of cases, were seized more than five years ago, between 2007 and 2018.
“At the current rate, 25 to 30 cases are being disposed of per year and the number of new cases continues to grow exponentially. This pace puts a burden on the courts, the State, the FID, and the defendants from whom the cash was seized. The FID has been exploring options to improve the regime, which will require dialogue with the Ministry of Justice, Ministry of National Security, Jamaica Customs Agency, Jamaica Constabulary Force, and the courts. As these discussions progress regarding solutions to dispose of these aged cases, more information will be provided to the general public,” Clarke said.