Dunkley sees Arbitrade ‘red flags’

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  • Concerned: Michael Dunkley says government's silence on Arbitrade is

    Concerned: Michael Dunkley says government's silence on Arbitrade is "disconcerting"


Government response

Last night, after our print-edition deadline, a government spokesman responded to our questions about Arbitrade. However, the statement did not mention the company by name, nor did it address any of the firm’s specific claims, such as Government’s alleged purchase of a building, the Alice programme or any plans for gang members to be paid to work on a chicken farm.

The statement, in full, reads: “The Fintech Development Fund was passed in the Senate today.

“When the fund is set up and contributions can be received, the Government will make such contributions public.

“We are pleased that companies are looking to set up in Bermuda, planning to invest in building our fintech industry and supporting community initiatives.

“The same way insurers assisted with developing our insurance industry while supporting community organisations over the years.”

Silence is not golden when it comes to the Bermuda Government’s lack of response to claimed initiatives mentioned in a conference call by crypto exchange and coin company Arbitrade.

Instead it is “disconcerting,” according to Michael Dunkley, the former Premier, who is now Shadow Minister for National Security.

“The press comments by Arbitrade raise more red flags than a hurricane on the South Shore,” he said.

Arbitrade intends to base its global headquarters on the island at Victoria Hall in Hamilton. During a telephone conference call a week ago, its founder Troy Hogg said it would make a $1 million donation to the Government for the refurbishment and launch of a fintech co-working incubator space at the Park Place building, which it said Government has bought for $4 million. It is unclear if the Park Place mentioned refers to the office block with that name on Par-la-Ville Road, or the IAS Park Building on Church Street.

Mr Hogg also said Arbitrade would like to make donations totalling $125,000 to a number of projects on the island, including Family Centre, Mirrors programme, and a government gang violence reduction programme that involves gang members working in “therapeutic farming and plant husbandry” and being paid to work on chicken farms. A further programme mentioned was Alice — an active shooter preparedness taught by the FBI at schools and charities.

Mr Dunkley wants to know if the Government can confirm Bermuda is involved in the Alice programme, or that five acres of arable land has been given to Government for a gang violence reduction programme.

“These are initiatives that the Government has not rolled out. Why has Government not come back and clarified right away?”

Mr Hogg began his portion of last Thursday’s conference call by defending himself against social media and online attacks. Mr Dunkley felt that making such opening remarks was “a red flag”, he also took issue with the conference call ending with no questions being allowed.

He said: “That goes against the grain of getting off on the best foot. Bermuda has always been a good place to do business. By the conduct of this press conference, I think many people will question if they can meet the high standard that Bermuda has built.”

Mr Dunkley said the donation of $1 million towards the Government’s fintech incubator project, which Mr Hogg said would be done early this week, makes him wonder if it violates any legislation.

He said he had been left scratching his head by the conference call comments.

“I find it disconcerting that the PLP have said very little. I thought the Government would be quick to say something. Does it support this? Has it met with the individuals? They have been eerily silent.”

He added: “I behove the Government to say where they stand on this and what they expect going forward.”

The Royal Gazette contacted the Government and the Bermuda Monetary Authority on Tuesday to seek details on the status of Arbitrade and its reported comments.

A transcript of the conference call appears in the Cryptocurrency Business Group website, posted by Tom Mitsoff, a bitcoin coach and author. It can be read at: https://tinyurl.com/yb9qvsfr. An audio recording of the conference call can be found on YouTube at https://tinyurl.com/y9m37co6

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Published Jul 5, 2018 at 8:00 am (Updated Jul 5, 2018 at 8:03 am)

Dunkley sees Arbitrade ‘red flags’

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