ATL Pension Fund trustees could have thought allocation without consent OK - attorney

A senior attorney for the Appliance Traders Limited (ATL) group has testified that based on his interpretation, the deed that governed the ATL Pension Scheme in 2010 did not require the consent of the founding company for the allocation of the interest surplus.

"Interest surplus is allocated as a matter of course," attorney-at-law Trevor Patterson said yesterday as he gave evidence in the billion- dollar ATL Pension Fund fraud trial of three former executives with the group.

However, testifying under cross-examination, Patterson said the allocation of the fund's withdrawal surplus required the consent of the founding company, Gorstew Limited.

"But the trust deed doesn't say so, does it?" defence attorney K.D. Knight questioned.

"It does not," Patterson agreed.

"So they [the trustee of the fund] could reasonably interpret that since there is no consent required for the net interest surplus, there could have been no consent required for the withdrawal surplus?" Knight pressed.

"Could have," the ATL attorney replied.

Former chairman of the ATL Pension Fund, Patrick Lynch, and the former general manager of the scheme, Catherine Barber, along with Dr Jeffrey Pyne, the former managing director of Gorstew, are on trial for the allocation of nearly $1.7 billion of interest and withdrawal surplus to members of the scheme without Gorstew's consent and allegedly using four forged letters to indicate that consent was obtained.

Responding to questions from defence attorney Knight, Patterson said he could not recall giving ATL boss Gordon 'Butch' Stewart "that specific advice [that only the withdrawal surplus required Gorstew's consent]", but added that he recalled having a discussion with ATL general counsel Dmitri Singh and "I may have mentioned it".

SPANNED TWO ALLOCATIONS

The ATL attorney also acknow-ledged that Stewart was a director of the ATL Pension Fund Nominee Limited between 1994 and 2002 which, according to the indictment against the three accused, spanned two surplus allocations.

"So someone who has been a director for eight years ought to have known what was taking place in relation to the allocation of bonuses?" Knight questioned.

"From the minutes and from attending the meetings, yes," Patterson testified.

Knight also made reference to a 2005 article published in the Jamaica Observer newspaper about a press conference attended by then deputy chairman of the ATL group, Christopher Zacca, to discuss the 2004 surplus distribution.

Patterson conceded that the article indicated that the ATL Pension Fund has an actuarial surplus of more than $700 million and that the minimum payment to members was going to be increased.

"As a director of Gorstew and deputy chairman of the ATL group, would he not have had a responsibility to ensure that consent, at least for the withdrawal surplus, was obtained before distribution?" Knight questioned.

"As a trustee, yes," Patterson replied.

He will continue giving evidence when the trial resumes today.