The liquidators of Caledonian Bank and Caledonian Securities have announced they are looking for potential buyers for the two entities.
The staff of the bank and its brokerage arm, which were ordered by the Grand Court to be wound up on Feb. 25, on the application of the Cayman Islands Monetary Authority, will continue to be paid under the terms of their contracts, the liquidators said in a statement.
Staff will assist the liquidators, Keiran Hutchison and Claire Loebell of Ernst & Young, with preparations for efforts to sell the two businesses.
“Employees have been advised that redundancies are likely, and they are free to resign if they should choose to pursue other opportunities,” the statement said. “Notwithstanding this the Liquidators would welcome the opportunity to introduce them to a prospective new employer if a buyer for the businesses can be identified.”
The liquidators will continue to report their findings and are in the process of calling meetings of stakeholders. In the meantime, the operation of all services to the customers and clients of Caledonian Bank and Caledonian Securities remain suspended.
The appointment of the liquidators does not extend to other companies within the Caledonian group. However, the liquidators are working with the directors of those businesses to address any issues arising as a result of the liquidation of the bank and its securities arm.
Earlier this month, the U.S. Securities and Exchange Commission sued Caledonian Bank and Caledonian Securities for alleged violations of U.S. securities law, notably the sale of restricted, unregistered stocks to the public. These stocks, according to SEC claims, were part of penny stock pump-and-dump schemes. The SEC obtained a freeze order for $76 million of Caledonian’s U.S. assets, which effectively rendered the bank insolvent.