Shocking truth behind loan fund is exposed

A DAMNING report says that a controversial fund that has given more than £2 million of taxpayers' money to start-up businesses need to be closed until 'very significant failings' are addressed.

Senior States Members, civil servants and Jersey Innovation Fund board members have all come in for scathing criticism in the report by the Comptroller and Auditor General.

Full coverage in Thursday's JEP on the findings of the report, which reveal:

-£2 million was given to six new businesses -one has gone under and three others are significantly underperforming

- Board members had financial interest in applicants

-Attorney General could be called in to investigate

-'No more funds should be paid out until failings are addressed'.

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Comments for: "Shocking truth behind loan fund is exposed"

Simple sense

"Board members had financial interest in applicants" Oh dear! and did they disclose this and abstain from voting on the proposal to lend or what security was taken for the loan. Were board members qualified to make decisions about venture capital loans. Lending in such circumstances amounts to equity, unless there is excellent security, so were there any options or warrants to subscribe for shares in the fledgling business that could be exercised if it did well. If not, why not? This is all very basic standard procedures. Was each business required to file reports on progress every 3 months detailing cash flow, attainment of targets etc so that the health of the business could be monitored. Who were these board members who seem to have failed so badly and if the report is so damming should we ban them from public office.

S2

Shocking indeed. How can anyone contemplate assessing a huge loan that they have a financial interest in? Incredibly stupid or incredibly corrupt - pick one.

Mr Sensible

Does anybody know if the recently deposed mike king had anything to do with this total mess up, if he was no wonder he took the money and run

Bazzer

It would appear he did - he was the accounting officer!!

What little we know so far is absolutely staggering - God only knows what is still under wraps.

Most of the bods involved seem to be States employees with little or no experience of the real world if this mess is anything to go by.

This Island has many grey haired people in retirement, with relevant experience, who would no doubt be willing to assist the States in the governance of these sorts of schemes Yes, they may want remunerating but nowhere near the levels of pay and pensions the States have been paying to the people who appear to have messed the fund up. Moreover they would be completely independent and not be susceptible to pressure from peers to cover up or keep things quiet.

Simple sense

Very true, but nowadays we grey haired chaps with 40 years experience of finance are certainly not wanted as we will likely show up the younger less experienced people as promoted beyond their abilities. Our expertise is an embarrassment to them, along with the far smaller cost of employing us.

Mickey Mouth

Too true. The 'talent' I often come across is rarely justified and seldomly realised. Give me good old experience and a record of delivery over 'potential' any day of the week.

Judge Jeffries

Scandalous ! I note that 'Teflon Phil' is already trying to spin his way out of this by suggesting that he has been actively addressing the scheme's failings. However, he can't escape the fact that it has all happened under his watch. Time to do the honourable thing.

stanback

FALL ON YOUR SWORD PHIL

karaoke joe

Never ceases to amaze me total incompetency. Any other society would call it corrupt

BeanThereDoneThat

Apart from the rancid smell of cattle manure emanating from this fiasco, I think it clearly demonstrates why The States and Civil Servants should not be messing with loan facilities and property speculation.

I doubt with all the checks, balances, appraisals and due diligence observed and undertaken by Banks and financial institutions would any of the money have been given over in loans.

The message is leave money lending to those that are good at it, also property speculation, if the public were aware of the hand outs and inducements being given to the new tenants of the so called finance centre they would be up in arms.

Apart from non industry norm rent free periods the paying off of existing leases and settling up of FRI obligations in respect of dilapidations are just a few of the tricks where taxpayers money is being frittered away by another over paid under qualified States Quango.

One wonders what it will take for the COM to wake up, and why did we pay Mike King to leave, I am sure dereliction of duty is just cause to get shot of an overpaid and incompetent Civil Servant, but hey this is Jersey after all.

constables out

"AG to investigate" probably not in the public interest as usual!!

Kaz81

Philip Ozouf has been exonerated and was the only person praised for freezing the fund. Sam Mezec must be devastated unless his friend - Andrew Lewis can salvage some scandal.

AJ

Ozouf is doomed now....but no doubt will talk his way out of this!

Grumpy Git

Get the fraud squad in and let them deal with it. Obviously there is something dodgy going on

Abaddon

Hello Jon now here as Kaz81, again you are completely wrong, do try and work with the facts.

Philip Ozouf has not been exonerated at all. It is for banks to give or not give loans; it is for property developers to take multi million pound risks in developing property not Government. Senator Philip Ozouf takes neither of these positions.

Philip Ozouf when treasurer received a copy of the sensible and straight to the point " Dear Freddie " letter advising that it was not in Jerseys' interest to develop office blocks at the Esplanade causing oversupply. Philip Ozouf went against the advice of the board and supported building the International Finance Center using public assets but has never given a coherent reason as to why.

He did tell the States Assembly there would be no financial risk. On BBC radio he then said the SoJDC was in competition with other developers, obviously competition carries risk therefore this makes his first statement to the States assembly a lie

He did say that the offices would only be built if tenants want then in 2011, therefore another lie as over half the offices built by SoJDC are still not signed up therefore not rented.

He said that the SoJDC office blocks are adding to the beauty of St Helier making St Helier more attractive than St Peter Port. Is seriously deluded ? How can plain industrialised shapeless boxes be more pleasing to the eye than a historic and interesting town like St Peter port ?

Senator Ozouf is like a child playing with other peoples money in a grown up world while the CoM sit on their hands. The same CoM's politicians who are individually worried for their political careers at the next election over their support for SoJDC and rightly so.

Kaz81

I've changed sex, it was Maureen last week.

I do not know Paul Letherbarrow but if you post under your real name for a change then I may respond. Now off you go to Planet Desert.

The Moaning Old Bugger

Heres what is going to happen:-

Ball-less Gorst to not say a work

Teflon Wonderboy will spin some crap about been midd informed

A4 Binder man will shrug his shoulders and blame the 2 prats KING AND GALLICHAN

no resignations at all

anyone what a bet???

The Moaning Old Bugger

sorry miss informed

The Moaning Old Bugger

and the Auditor General will disappear in 6 months

Oldwoman

And we the general public as normal will do nothing. We should be in the royal square hammering on the doors, to get rid of this incompetent goverment NOW, we can not afford another year of their inability to deal with the real problems this Island faces, they are ruining this once beautiful Island.

Mickey Mouth

Alas too true.

Anthony

The fund loss is bad enough but actual cost is far greater if you take into account management and non executive Director time, fees and expenses.