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Jun 29, 2005

S.S.B. Committee hearing recalls old witnesses

Story PictureThe Special Senate Select Committee investigating the Social Security Board’s investments held its fifth public hearing today, and if there was a catch phrase for the session, it was “to the best of my knowledge”. With no less than six high profile witnesses called to testify, today’s proceedings were fraught with finger pointing, as each official strategically deflected blame from their respective organisations. First to take the stand–for the second time–was Chief Executive Officer of the Development Finance Corporation, Troy Gabb. Gabb admitted that he did not actually read every document that he signed, but maintained he thought the loans securitised for the Glenn Godfrey companies’ projects were backed by reasonable collateral. As a result, Gabb says neither he nor the D.F.C. feels any responsibility for the subsequent defaults.

Troy Gabb, Chief Executive Officer, D.F.C.
?The land is there and I think that that land is still a part of that security. I think it makes no reference there about any erection. I think you need to understand that it wasn?t our project, it wasn?t the D.F.C.?s project, it was a project that was brought into the pool by S.S.B. and guaranteed by S.S.B. and they were wholly responsible for the administration of those loans, including collecting and paying into the D.F.C. We did no physical due diligence on that project, because all the documentation that we received were authentic and fit all the profiles and was guaranteed by the B.S.S.B. That?s what we have rep on warranties–that the properties were there and were duly registered and duly assigned because that was the property.?

?Nothing there says, at the point in time when we reped and warranted there, we had everything authentic, we had all the information, we had the insurance. Everything appeared extremely authentic. We had the guarantees and support from the B.S.S.B., which has been under all normal circumstances; we have never done any due diligence on any project that the B.S.S.B. has put in the pool. From way back in my investigation and to the best of my knowledge, from way back from the beginning of securitisation where the S.S.B. was putting loans in the pool, they guaranteed their own flows; they also conduct their own administration. The D.F.C. under no circumstances had ever went and did any physical inspection of any of the properties or loans that were placed in there.?

Godwin Hulse, Committee Chairman
?What I am hearing from you is that as per the documentation, because the documentation suggested that this was correct, you were satisfied.?

Troy Gabb
?That is correct. And so to the best of our knowledge, we reped and warranted accurately.?

Godwin Hulse
?The final point, point forty-three, no mortgager is an employee, officer, director, or shareholder, or is related to an employee, officer, or director of the seller in any way. You were not aware that Mr. Godfrey, your chairman, was related to these projects as shareholders or directors??

Troy Gabb
?I answered that question earlier Mr. Chairman that I was not aware at that time of signing that Mr. Godfrey or the chairman had any association with these two projects. We saw them strictly as St. James projects.?

Godwin Hulse
?Do you feel any responsibility at all, personally and by extension the D.F.C. in relation to all that has gone wrong with this process and particularly with these projects that were part, or popularly known a part of The Godfrey Group? Do you feel personally any responsibility or that anything was not done or could have been done better on the part of the D.F.C. or should have been done to ensure that these could have all gone successfully??

Troy Gabb
?I don?t…there is no responsibility on the part of the D.F.C. in reference to handling of the transaction and how it has been handled before.?

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