A fortnight of frantic activity to establish whether or not client account funds had been compromised followed weeks of rumours that Marrache & Co were in financial difficulty. It is understood the RGP Financial Crime Unit is monitoring developments. The financial hole is believed to run into millions.
It was the FSC which yesterday evening formally burst the bubble when it announced that it had cancelled a series of licences mostly related to their trustee services.
The timing was driven by law and came immediately after urgent legislation was Gazetted by the Gibraltar Government creating the power of an authorised administrator. In a separate move related to the crisis, lawyers acting for an Irish based client last Friday sought an injunction against Marraches and at a further hearing today will be seeking to secure property assets valued at over £2m.
The FSC yesterday cancelled nine licences that had been granted to firms and persons operating under the Marrache umbrella.
It was a week earlier on Monday February 1 that, following earlier FSC intervention, Freddie White of Grant Thornton’s, a leading figure in liquidations and administration work, was authorised by the Chief Justice to investigate and then take control of the firm’s finances.
But in the days leading to that decision the FSC declined to make any comment at all on its actions or investigations, not even confirming these.
The senior partners of Marraches are brothers, Issac Marrache and Benjamin Marrache. Solomon Marrache is the finance director. Until last night the partners had also declined to take phone calls or reply to emails from the Chronicle over the past 10 days.
In its press release the FSC said that it had yesterday, pursuant to Section 11 of
the Financial Services (Investment and Fiduciary Services) Act, cancelled the licences of the following licensed firms and persons:
Gibland Secretarial Services Limited ; Licence No FSC00171B
Gibland Nominees Limited ; Licence No FSC00175B
Equity Nominees Limited ; Licence No FSC00174B
Equitar Management Limited ; Licence No FSC00172B
Gibter Management Limited ; Licence No FSC00173B
Cabor Trustees Limited ; Licence No FSC00430B
Meridian Trustees Limited ; Licence No FSC00890B
Marrache, Benjamin John Samuel ; Licence No FSC00736I
Marrache, Solomon S ; Licence No FSC00176I
It went on to state that the decision has been taken “following an investigation into the affairs of the licensed entities and persons which in the opinion of the Commission have disclosed serious and persistent breaches of Gibraltar’s financial services legislation.”
“The Commission, while investigations continue, has taken immediate measures to safeguard the interests of the existing clients of these firms and has appointed Mr Frederick White Managing Director of Grant Thornton (Gibraltar) Limited of 6a Queensway, Gibraltar (Tel. 200 45502) as Authorised Administrator of all the above companies pursuant to the provisions of the Financial Services (Investment and Fiduciary Services) (Temporary Administration of Companies) Regulations 2010,” said the statement.
The FSC said that the Authorised Administrator “will work closely with the clients of these firms in assisting them to transfer their business to other licensed entities at the earliest opportunity having regard to the particular needs of individual clients”.
Marrache & Co has offices in London, Spain, Lisbon, Prague and Luxembourg and also had business interests including properties and a tobacco and liquor licence with a shop that closed last year.
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