Tonight there is grim news in the offshore industry. Indications are that Choice Bank, an offshore bank operating from Belize City, is winding down due to a cash flow crisis involving the prepaid card component of its international banking business. After ten years in operation, the banks website claims it is the largest international bank in Belize with two hundred and thirty-eight million U.S. dollars in assets, dealing with more than three thousand corporate accounts worldwide and with more than three hundred thousand prepaid cards in circulation as well as a proven track record of success. But several weeks ago, clients were informed that the bank is facing a crunch with liquidity. All withdrawals from deposit accounts have since been put on hold, along with other services provided in respect of payments. The existing state of affairs at the offshore bank continues so that by the end of June, the bank will be closing. Some staff members have already been released, while others are being let go gradually. P.M. Dean Barrow weighed on Wednesday in on the matter in his capacity as Minister of Finance, stating that it is a crisis that is unique to Choice Bank and is related to the entertainment business.
Prime Minister Dean Barrow
“No, I think it’s peculiar to Choice Bank. As I understand it, it’s a regulatory problem only in the sense that the issuer or the backers of the credit cards in which they traffic and which in the main their deposits are meant to secure withdrew from the relationship with Choice Bank. It seems that the bank does a lot of business with people in the adult entertainment industry, an industry of which I know only by reputation and reportage, and I certainly am no moralist in that regard. But it seems that regulators in the U.S. might for that reason alone, have put some pressure on the issuers of the credit cards in which they dealt and of course that caused a kind of run on the bank, in terms of the people who their deposits to back up their credit cards and who were told well your credit cards can no longer be issued or can no longer be operational zed. So it really is peculiar to them, the Central Bank has been very quick in trying to in fact get a hold of the situation. I signed a letter based on the recommendation of the Central Bank giving the Central Bank broader powers than would normally be the case to, as it were, ensure that the bank’s continued operations would be with a view to seeing all their depositors and customers satisfied as far as is possible.”