The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A Bahamian crowdfunding platform yesterday confirmed multiple accounts it holds with Bank of The Bahamas have been unfrozen after a dispute with one of its founding financiers impacted "probably thousands" of investors for months.

D'Arcy Rahming Sr, ArawakX's chairman and chief executive, told Tribune Business the company and its parent, Mdollaz Ltd, had ultimately prevailed in a battle for control of the crowdfunding platform with one-time Colina Insurance Company president, James Campbell.

The fight with Mr Campbell, understood to have been an 'angel investor' who provided ArawakX with a portion of its start-up funding, resulted in multiple bank accounts held with BISX-listed Bank of The Bahamas being temporarily frozen. Mr Rahming confirmed the freeze, which impacted monies belonging to crowdfunding investors as well as three companies that sought to raise financing via this mechanism, had lasted for eight months.

Justice Simone Fitzcharles, in a May 16, 2023, Order that also mentions Mr Campbell by name, ruled that Bank of The Bahamas "shall forthwith restore the claimant's [ArawakX] access to, and operation of, all of the accounts" that had previously been frozen.

The Supreme Court judge also ordered that Mr Campbell, "and all persons claiming under, by and through Mr Campbell, shall not continue or subsequently prosecute" any claims against the BISX-listed institution as set out in "the Higgs and Johnson letter dated October 28, 2022".

Bank of The Bahamas is also "restrained from restricting, prohibiting or otherwise interfering with [ArawakX's] operation of, and access to, all of the accounts" subject to the action. Justice Fitzcharles also ordered that ArawakX and Bank of The Bahamas' legal costs be paid by Mr Campbell, who is the father of Centreville MP and minister of state for legal affairs, Jomo Campbell.

Mr Rahming yesterday acknowledged the account freeze could have inflicted significant damage on Arawak X, its crowdfunding model and investor confidence in the wider Bahamian capital markets had continued for an extended period of time.

"We are the protecters of the capital markets," he told Tribune Business. "We take it very seriously, our responsibilities to issuers and individual investors. People work hard for their money, and when they invest their money we have to make sure it's secure and protected."

Asked what had prompted the freezing of the accounts, and the assets they contained, Mr Rahming replied: "They were holding up some client accounts. Jimmy Campbell was an early investor in our company. He felt he had control of the company, and he did not have control of the company. That's what the ruling said.

"Those are client accounts, not ArawakX accounts. We have to defend the rights of our issuers and investors. We had to step in and take court action, and the court has agreed with us." Mr Rahming did not place a dollar value on the collective worth of the assets that were unfrozen, but it appears likely the facilities may have been omnibus escrow accounts that held monies on behalf of small retail investor participants in crowdfund offerings.

The ArawakX chief, arguing that the reasons given by Mr Campbell and Bank of The Bahamas for freezing the accounts "make no sense legally", confirmed that the hold had lasted for eight months before being released. "From the issuer side, three issuers [companies] were affected," Mr Rahming told this newspaper. "From the client side, probably thousands. We had to fight that. We are the protectors of the markets. We cannot allow that at all.

"We want the clients to know everything is secure, and all their funds and investments are secure. It's very important for us to realise that. We're fully regulated, and have been working with the Securities Commission and auditors to make sure everything was appropriately done.

"As you can imagine, there are severe damages but we are dedicated to our clients and to our markets. There are so many people calling us every day for help with their businesses, and we are willing and able to help them," Mr Rahming continued.

"This is a big market that is developing. We have $80m in needs, 28 clients with excellent ideas and companies, all Bahamian, and we have 3,600 investors registered with us. This is something very good for The Bahamas, and we are working hard to the great satisfaction of investors."

Mr Campbell, who was ousted from his Colina Insurance Company post some 15 years ago after losing a corporate battle with then-business partners, now A. F. Holdings principals, Emanuel Alexiou and Tony Ferguson, could not be reached for comment before press time last night.