Dr Paul Chen-Young passes
Dr Paul Chen-Young, the former Eagle Group chairman, died from cancer in Florida yesterday. He was 82.
Chen-Young, who had been living in Florida for many years, will be remembered as one of the bankers who suffered heavy losses when Jamaica’s financial sector collapsed in the 1990s.
He had published a book on his experience with the Financial Sector Adjustment Company (Finsac) — the entity established by the then Government to deal with the crisis — and the Jamaican court system which he described as a “very personal story” that he felt “had to be told for this generation and for posterity to show the almost impossible conditions under which a citizen was able to stand up and fight the mighty power of the State”.
The book, titled Decades awaiting justice in Jamaica, is essentially a compendium of legal submissions, with some elaboration.
“The legal tribulations described in this book, and the arguments presented, provide a repository of outstanding legal submissions which should be valuable legal reference material in relevant commercial lawsuits,” Chen-Young had said at the time of the book’s launch.
His Eagle Financial Group was taken over by Finsac in 1997, and a forensic audit initiated into the operations of the group.
The following year Chen-Young faced a $900-million lawsuit brought by Eagle Merchant Bank and Crown Eagle — two of the companies he founded.
He subsequently left the island.
Over the years he had repeatedly insisted that people connected to Finsac had made relentless efforts to discredit him and destroy his career.
The book starts with the definition of justice, which typically references a system of law in which every person receives his/her due from the system, including all rights — both natural and legal.
In a submission which he had prepared for a commission of enquiry into the financial sector dbcle, but which he was unable to present, Chen-Young had said: “When the run on banks precipitated the crisis in 1996-97, the Government created Finsac in late 1996. Shortly thereafter, it became the largest holding company in Jamaica, owning some 158 companies; nearly all of the domestic-controlled banks, accounting for about 60 per cent of total assets; and nearly all of the life insurance companies, representing at least 90 per cent of total assets.
“In December 1992, new legislation was enacted to strengthen and restructure the country’s banking and insurance industries. But, with hindsight, it was too little too late, and the next five years saw the Government of Jamaica assuming management or control of a number of failed financial institutions, notably the Blaise, Century and Eagle financial entities.”
The cost of the financial collapse to Jamaica was some $120 billion in taxpayers’ money and 40 per cent of the country’s GDP.
The meltdown bankrupted Jamaican investments and released the financial institutions into an extremely aggressive market in which major banks, near banks, insurance and investment companies fell back into the hands of foreign investors, taking with them millions invested in the Jamaicanisation process by locals, and even millions more in excessive interest rates owed to these entities.
Chen-Young began his career with the World Bank in 1966, then moved into senior management positions in Jamaica at Development Finance Corporation, Lai Corporation, and put together Workers Savings and Loan Bank which was considered owned by the workers of Jamaica.
He started his own business in 1975 — an economic and financial consulting firm, Chen-Young Associates — followed by the stockbroking firm Paul Chen-Young and Company and Eagle Merchant Bank, which became the victim of government policy in the 1990s.
He received many awards for his contribution to Jamaica’s development and served on numerous public sector boards.
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