Fortis Fund Services (Bahamas) Limited, formerly Mees Pierson - The Fund Administrator of The $257 Million Collapsed Oracle Fund Settles with Investors

But The Details of The Settlement with Fortis Fund Services (Bahamas) Limited and The Investors in the Collapsed Oracle Fund  are being Kept Confidential

Investors Settle Mutual Fund

By Candia Dames

Nassau, The Bahamas

candiadames@hotmail.com

23/01/2004

Wealthy international investors who lost millions of dollars in the failed Oracle Fund have reached a settlement with the fund's administrator, bringing to a close another chapter in the much-publicized debacle.

Attorneys representing the investors were before the Supreme Court this week seeking to recover millions of dollars in losses suffered as a result of the collapsed fund.

The announcement of a settlement between the Hong Kong Shanghai Banking Corporation (HSBC) and Fortis Fund Services (Bahamas) Limited, formerly Mees Pierson, which administered the fund; and another settlement between Union Bank of Switzerland (UBS) and Fortis was made before Justice Hugh Small Thursday afternoon.

But details regarding the settlement are being kept confidential.

The case is set to continue in the Supreme Court next Wednesday as Hunter Douglas, a home products corporation, another major investor in the fund, continues with its action.

The $257 million Oracle Fund was registered on February 26, 1997 as an authorized mutual fund but collapsed in 2000, with the blame resting at the feet of Fortis.

The investors accused Fortis of "misrepresentation and breaches of statutory duty" which allegedly resulted in the fund losing a substantial amount of money.

Losses reportedly totaled at least $160 million.

Investors soon began demanding their money after the Securities Commission determined that Fortis carried on the business of administering the Oracle Fund "in a manner which was prejudicial to the investors and/or creditors of the said Mutual Fund."

There are two actions being heard simultaneously before Justice Small regarding this matter.

In a yet another action, the liquidators in the matter sued the fund's director and administrator and reached a settlement last year.

After the Commission ordered that Fortis discontinue administering the fund, smaller investors joined larger investors from around the world in filing complaints to the Commission.

Several years after the collapse, shareholders were still fighting over some of the money recovered by the liquidators.

The Commission had also issued an order preventing Fortis from licensing any additional funds.  Plaintiffs claim that Fortis did not follow investment guidelines, which led to the Oracle collapse.

The administrator reportedly made poor investments, a source on the Securities Commission at the time of the collapse told the Journal.

The fund was reportedly suspended because there was a problem regarding the valuation of its assets.

Past Journal investigations indicated that Fortis invested in a New Jersey-based company known as the Breen Capital Group, which issued promissory notes.  The company then reportedly bought tax lien certificates with the intentions of fulfilling its obligations to pay off the debt.  But that investment proved to be a bad one, the Commission determined.

The Commission source said during the time of the collapse that regulators had determined that a "financial blow up of monumental proportions" was brewing.

College of The Bahamas (COB) President, Dr. Leon Higgs Struggles to Hold On to His Job

Dr. Leon Higgs is The Fifth President of The College of The Bahamas (COB)

Higgs’ Job On The Line

By Candia Dames

Nassau, The Bahamas

candiadames@hotmail.com

21/01/2004

College of The Bahamas President Dr. Leon Higgs is embattled as he struggles to hold on to his job.

Members of the College Council interviewed Dr. Higgs yesterday, but that meeting turned out to be more of an assessment of his performance as president, resulting in Dr. Higgs becoming angered by the whole process, according to sources within the college community.

The COB president, meanwhile, has been phoning Cabinet Ministers asking them to intercede on his behalf, the Journal has learnt.

Since his appointment in November 1998, Dr. Higgs has faced opposition from some members of his executive team, who had applied for the top post after the resignation of former President Dr. Keva Bethel.

Among those who had sought the position are Executive Vice President Dr. Rhonda Chipman-Johnson and Vice President of Research and Planning Dr. Pandora Johnson.

The Journal has learnt that a recent independent study conducted on the college's staff and faculty indicated several weaknesses in all areas of the institution.

Council Chairman Dr. Franklyn Wilson is said to be playing a large role in shaking the college up as it is being prepared for university status.  In fact, Prime Minister Perry Christie praised Mr. Wilson this week for what he sees as the positive changes that have taken place under the chairman's leadership.

But some faculty members at the college believe that Mr. Wilson may be micromanaging and even usurping the authority of the president.

Dr. Higgs reportedly feels that he is not receiving the support he should be receiving from the Council.

Many others believe that the whole process is humiliating Dr. Higgs as he is being made to explain why he should stay on at the college.

When his five-year contract expired last year, the Council asked him to stay on, but to wait a year before his contract is reconsidered.  According to Mr. Wilson, it was a "courtesy" Dr. Higgs agreed to extend to the Council.

The Journal has learnt that among those waiting in the wings, seeking to become the next president of the college, are Dr. Pandora Johnson, who as mentioned is an executive at the college; and Dr. Norris Stubbs; Dr. Charles Taylor; and Dr. Sidney McPhee, all Bahamian educators residing in the United States.

 

Dr. Higgs was on Tuesday out of office, but in a previous interview with the Bahama Journal he said that he was interested in staying on for another term.

"I believe that there is much work to be done in this institution," he said.  "I think this is an important institution in the life of this country and I would like to continue to be a part of its development."

He also said that there has been some degree of tension between him and other members of the college's executive team who had been overlooked for the position of college president.

At that time, the council was advertising executive positions, including that of president, in local and international publications.  It is the policy of the institution to advertise such positions when contracts expire, even if the incumbents wish to negotiate new contracts.

Mr. Wilson had explained that the college was undergoing a "leadership review."

Some executives of the institution had also threatened to take legal action after learning that they were being stripped of tenure and placed on contract.

The Journal also reported last month that senior managers of the college are in for a shake-up by the middle of this year, if the Council executes restructuring plans that have been mapped out.

The realignment of the college's management is set to take place by July as an essential step in the transition to university status, according to Mr. Wilson.

While some senior management positions will be abolished and the responsibilities attached to others revised, the council also intends to create new positions.

Mr. Wilson communicated as much in an extensive statement on COB, which tackled the most pressing issues facing the country's premier tertiary level institution and plans for change.  That statement ran in local newspapers several weeks ago.

Mr. Wilson, meanwhile, has insisted that it is not the council's intension to treat Dr. Higgs unfairly.

A native of Andros, Dr. Higgs was the director of training at The Bahamas Technical and Vocational Institute before being appointed to his present post.

In 1998, he was said to be brilliant during the rounds of interviews and was selected for the presidency over 10 other Bahamian applicants who were all holders of doctorate degrees. In its evening edition on Tuesday, July 7, 1998, the Journal in breaking the story on Dr. Higgs' appointed noted that, "Several lecturers at COB are on record as saying a focused man such as Dr. Higgs comes well qualified for the post."

He received his doctoral degree in administration curriculum and instruction from the University of Nebraska and spent 13 years in top positions at various colleges and universities in the United States before returning home in 1995 to serve as the Assistant General Manager of Human Resources at the Water and Sewerage Corporation.

Dr. Higgs is the fifth president of COB.