According to a report in the Miami Herald, the restructuring officer, Giselle Santana, told the US Bankruptcy Court of the southern district of Florida on Monday that she had been employed by Providence for only a few weeks.
Her previous experience doing corporate financial analyses was limited to work for a couple of small businesses in 2013.
Santana testified that she was hired by Antonio Buzaneli, Providence’s chief executive, in early July for a one-time fee of $7,000 (£5,270, €6250) to review the company’s books and make a recommendation to the company going forward, but was provided very limited financial documentation going back only as far as 2015.
When she asked about other years, as Providence had been accepting money from US investors since at least 2013, she said she was told by Buzaneli that there aren’t any other financial statements.
With that information, she told the court she could see “nothing in this company is working” and recommended the company file for bankruptcy protection. Buzaneli was not present at the hearing.
Providence filed for Chapter 7 bankruptcy protection in the US on 28 July after the Securities and Exchange Commission moved to shut it down in June, calling the investment scheme involving factoring in Brazil an “ongoing fraudulent and unregistered securities offering”.
The securities that offered annual returns of 12% to 13% had not been registered with the SEC, and brokers selling them were unregistered, the SEC said in its complaint.
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Last month the Royal Court of Guernsey ordered the winding up Providence Global having earlier appointed Deloitte as administrator of locally-registered Provident Investment Funds and its manager Providence Investment Management International which found that the parent company was insolvent.
Jersey’s financial services regulator has also launched its own investigation into the sale of Providence Investment Funds to clients of Jersey-based IFA firm Lumiere Wealth, which is majority owned by Providence Global.
In the US, Providence has not been able to account for the money it has collected from clients, which is estimated to be about $64m from US investors alone.
Until the SEC action the company’s poor financial condition wasn’t disclosed to its investors, while it continued to solicit the retirement savings of more than 400 investors around the country, according to the Miami Herald.