Sunstone Holdings Ltd and De Lec Ltd (P.90/2013): Budget transfer from Central Contingency to Chief Minister's Department to fund Inquiry

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A decision made 12 September 2014:

Decision Reference: MD-C-2014-0152
Decision Summary Title :	Sunstone Holdings Ltd and De Lec Ltd Inquiry – Central Contingency Funding Request	Date of Decision Summary:	9th September 2014
Decision Summary Author:	Finance Manager, Corporate Group	Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written	Person Giving Oral Report:	N/A
Written Report Title :	Sunstone Holdings Ltd and De Lec Ltd Inquiry – Central Contingency Funding Request	Date of Written Report:	5th August 2014
Written Report Author:	Finance Manager, Corporate Group	Written Report : Public or Exempt?	Public
Subject: Request for Central Contingency funding to fund the Sunstone Holdings Ltd and De Lec Ltd inquiry.
Decision(s): The Chief Minister accepted a non-recurring budget transfer in 2014 of up to £57,800 from Central Contingency (one-off) to the Chief Minister’s Department (CMD) revenue head of expenditure to fund the Sunstone Holdings Ltd and De Lec inquiry.
Reason(s) for Decision: As part of the debate P90/2013 – “Sunstone Holdings Ltd and De Lec Ltd – ex Gratia Payments to Investors” the Chief Minister requested an independent expert be instructed to complete an independent review to clarify various points raised in the debate.
Resource Implications: The CMD revenue head of expenditure to increase by up to £57,800 in 2014 and Central Contingency (one-off) to reduce by an identical amount. This decision does not change the total amount of expenditure approved by the States for the period of the current MTFP 2013 to 2015.
Action required: Research and Project Officer to notify the Finance Manager – Corporate Group that the decision has been made.

Signature:

Position:

CHIEF MINISTER

Date Signed:

Date of Decision (If different from Date Signed):

Sunstone Holdings Ltd and de Lec (P.90/2013): Budget transfer from Central Contingency to Chief Minister's Department to fund Inquiry

Chief Ministers Department

Ministerial Decision Report

SUNSTONE HOLDINGS LTD AND DE LEC LTD INQUIRY – CONTINGENCY FUNDING REQUEST

Purpose of Report

To enable the Chief Minister to approve the request of a budget transfer of up to £57,800 from Central Contingency (one-off) to the Chief Minister’s Department (CMD) to fund the Sunstone Holdings Ltd and De Lec Ltd inquiry.

Background

In September 2013 the States debated a proposition lodged by Senator A. Breckon (P.90/2013) that –

• ex gratia compensation should be paid to investors who suffered financial loss as a result of investments in Sunstone and/or De Lec;

• the compensation should be subject to a maximum of £48,000 per investor (100% of the first £30,000 lost and 90% of the next £20,000);

• the compensation should be paid from central reserves, but legislation should be introduced to recover it from the Jersey Financial Services Commission (JFSC); and

• the Chief Minister should bring forward proposals under Article 27 of the Financial Services (Jersey) Law 1998 to establish an Investor Compensation Scheme in Jersey.

The debate was adjourned on the grounds that a number of States members did not feel they had sufficient information upon which to base a decision and the Chief Minister indicated that in the light of this he would initiate an independent review to clarify various points raised in the debate.

In November 2013, the Chief Minister invited David Thomas, who has held the position of Chief Ombudsman of the UK Financial Ombudsman Service and other relevant roles, to undertake an enquiry.

Recommendation

The Chief Minister is recommended to request a budget transfer of up to £57,800 from Central Contingency (one-off) to the CMD revenue head of expenditure to fund the Sunstone Holdings Ltd and De Lec Ltd inquiry.

Reason(s) for Decision

As part of the debate P90/2013 – “Sunstone Holdings Ltd and De Lec Ltd – ex Gratia Payments to Investors” the Chief Minister requested an independent expert be instructed to complete an independent review to clarify various points raised in the debate.

Resource Implications

The CMD revenue head of expenditure to increase by up to £57,800 in 2014 and Central Contingency (one-off) to reduce by an identical amount. This decision does not change the total amount of expenditure approved by the States for the period of the current MTFP 2013 to 2015.