On January 16 the Minister of Finance, Gaetan Pikioune, signed a Ministerial Order effectively placing APMA Financial Investment Centre/Cooperative (AFIC) under the Reserve Bank of Vanuatu’s (RBV) supervision and regulation as provided under the Financial Institutions Act.
Before that, AFIC was operating solely under the Cooperative Societies Act.
The Daily Post spoke to the Reserve Bank of Vanuatu (RBV) about the implications of the order because according to the Director, Barnabas Tabi, AFIC was registered under the Cooperative Societies Act.
In response, the Deputy Governor of the Reserve Bank (RBV) Peter Tari, explained to the Daily Post that the role of the RBV in respect of non bank/ financial Institutions as stipulated under the Financial Institutions Act Cap.254 is to supervise and regulate financial institutions that conduct banking business with the prime responsibility to ensure that the depositor’s interests are protected.
Tari, through a statement, explained that subsection 5 (3)(4)(5) of the Act further provides for the RBV to regulate and supervise other non bank financial institutions like the Cooperative Societies and Credit Union whose assets and liabilities exceed Vt10 million.
“This responsibility will be authorised by the honourable Minister of Finance as specified by the Financial Institutions,” he said.
He further explained that the order by the minister to authorize the RBV to apply some supervision and regulation provisions of the Financial Institutions Act to ensure that AFIC, which is currently registered under the Cooperative Societies Act Cap 152, operates in a sound and prudent manner to ensure that members’ fund/investments are safe, taking into account the overall responsibility of the RBV to ensure that Vanuatu’s banking/financial system is sound and provides for a conducive environment that promotes economic development.
The Supervision and Regulation by the Reserve Bank will be consistent with the Cooperative Society Act Cap 152 and will ensure that the operation of AFIC is within the appropriate legal framework that are currently in place to ensure that members funds/investments and interests are protected, the RBV statement said.
“The Reserve Bank of Vanuatu supports financial inclusion in Vanuatu to ensure that financial services reach the underserved population that do not have access to formal banking services, however, those institutions that provide these services must operate in a sound and prudent manner to provide the services,” the statement by the Reserve Bank of Vanuatu clarified.
In the meantime, the Director of AFIC, Barnabas Tabi, has denied receiving the order from the Minister of Finance which was issued on January 16, 2017. That was about a month ago, according to a copy of the order, which the Daily Post has a copy and which was posted on the Facebook this week.
“I have not received any copy of the said order until now as we are talking and I have only been told that it was posted on the Facebook yesterday (Tuesday) this week,” said the Director of AFIC.
Mr Tabi was asked about what the implications it may have on the company he runs and directs, because as the Daily Post understands, AFIC has substantial number of financial members mostly ni-Vanuatu throughout the country.
He was also asked if he intends to seek legal redress regarding the Ministerial Order.
The AFIC Director said it is too early yet for him to give an answer to the question because he said he has no idea what the content and reasons are in the order by the minister of finance.
He said once he receives a copy and studied its content and reasons for such a ministerial order, he cannot for the time being make any public comment. However, he assured every financial members across the country that their individual financial investment is secured, protected and well managed at this point in time.
“We registered AFIC under the Cooperative Societies Act in 2011 and we followed all legal requirements under all relevant laws of the Republic of Vanuatu.
“We already had one audit report produced on the financial operations of AFIC and shortly another audit report will be coming out,” he said.
He confirmed that AFIC has several thousand financial members across the country.
“I am not sure what the intention of the Ministerial Order is, but as far as AFIC operations and financial management and control are concerned, I can assure the Minister of Finance, the Vanuatu Government and the people of Vanuatu, especially the financial members that there is nothing to panic about, there is nothing to worry about because all the financial members’ investment are well managed, controlled and protected under the relevant laws of Vanuatu,” said Tabi.
He questioned the reason(s) for the minister order and said it could be motivated by foreign influence because AFIC is a totally ni-Vanuatu driven institution with new financial members increasing daily.
“In Port Vila alone we have up to 50 new financial members a day and should be noted that the moment a new member is registered with Vt10,000 investment they automatically receive 5% interest within the same minute they deposited their money,” Tabi claims.
“We don’t solicit nor borrow money from outside Vanuatu. All monies are raised locally by the company with the financial investment from our financial members,” he pointed out.
“The reason we created AFIC is to build an economic self-reliance base for the people of Vanuatu from grass root upward.
“I also want to make it clear to the Ministry of Finance, the Vanuatu Government and the people of Vanuatu that AFIC was set up within the principles of ‘Kingdom Dynamic’ which translates into the ‘so easy, go easy’ approach.
“We want to stand shoulder to shoulder with foreign investors in this sphere of business and to have equal standard for living for every citizens of this country.
“AFIC cannot be shaken– we are solid and once again we adhere to every relevant laws of the country with respect in doing business we have undertaken for the people of Vanuatu so far and will continue into the future,” he assured.
Tabi concluded by assuring the financial members that AFIC is carrying on with its business for and on behalf of every financial members from the north to the south of the country.