Above: Jamaica’s Parliament

By the Caribbean Journal staff

Jamaica’s House of Representatives passed new legislation this week aimed at combating the creation of Ponzi or pyramid schemes.

The Securities (Amendment) Act will enhance regulation of the securities industry by Jamaica’s Financial Services Commission to “address the proliferation of Ponzi schemes,” according to a government relesae.

Finance Minister Dr Peter Phillips said Jamaicans had lost “significant sums of money” as a result of the schemes, because of which Jamaica’s financial reputation had “suffered greatly.”

“What we seek to do is prevent the unlawful and the illegal and at the same time, to set out rules whereby legitimate operations may take place,” Phillips said.

The most infamous Ponzi scheme in the country was OLINT, a major Ponzi scheme led by David Smith, who pleaded guilty in the United States in 2011 for a series of financial crimes.

“We have had terrible experiences in the late 1990’s, in the 2000’s where unregulated investment schemes have cost Jamaicans great losses and so we want to be clear that we support this piece of legislation,” Opposition Leader Andrew Holness said.

The bill is part of the country’s programme with the International Monetary Fund.