2026-10-06 - Senate

00:05[clears throat]

00:20Investments

00:34company insurance

00:39trade and trade American.

00:58insurance

01:04guarantee.

01:13Guarantee

01:18Foreign

01:22speech. Foreign speech. Foreign speech.

01:52for

02:05our winner.

02:30Foreign

02:43speech. Foreign speech. Foreign speech.

02:52foreign.

03:05Amen.

03:07Yeah. Amen.

03:17Okay.

03:31Okay.

03:34All right. Uh

03:37I bid good morning to the uh honorable

03:40members of the uh committee of the whole

03:44of the government operations uh standing

03:47committee and we are here this morning

03:50to uh meet online with uh uh certain

03:54principles uh first and foremost Mr.

03:57Matt Wade uh of the uh South Pacific uh

04:02insurance company and uh I see that

04:08Aaron Warren uh an attorney representing

04:12uh the uh South Pacific and uh the

04:16principles of uh trade and maritime

04:21uh I'm sure I'm not sure I got your name

04:24sir.

04:26Marshall Jablum seeing on the screen

04:28right now.

04:32>> I'm sorry sir.

04:33>> Let me give you uh gentlemen an

04:35opportunity to introduce yourselves.

04:39>> Yes. I'm Marshall Jablon. I'm the sole

04:42member of Trade and Merchant Trade

04:44Services, a limited liability company in

04:47New York.

05:00Go ahead, Paul.

05:01>> Hi, I'm Paul Atinson. I'm affiliate of

05:05Marshall Chaplain at Trade and Merchant

05:07Trade Services New York.

05:09>> A moment, can you hang on, please, sir?

05:13Uh, we're trying to work out uh some

05:16audio issues here.

05:31Go ahead. Uh sir,

05:35>> can you see us over there?

05:39>> There will be a lag. So, uh we kind of

05:41have to wait a little bit for the sound

05:44to come through. Go ahead.

05:48Did you receive my uh introduction?

06:01I'm sorry.

06:04>> Yes. Have you received my introduction?

06:06>> Yeah, we can see you.

06:09>> Yes, I I spoke and I introduced myself.

06:12Shall I do it again?

06:13>> Yes, please.

06:15>> Yes. My name is Marshall Jablon.

06:19I'm the sole member of the limited

06:20liability company in New York called

06:22Trade and Merchant Trade Services. And I

06:25have with me my colleague. He's our

06:27chief strategist, Mr. Paul Atkinson. I'm

06:31speaking to you from Cyprus in the

06:33Mediterranean. And Paul is from speaking

06:35from Manchester, United Kingdom.

06:39>> Thank you, sir. Uh Mr. Wade, are you

06:43online right now?

06:46>> I am. Yeah. Can you guys see me? Okay.

06:51>> All right. Well, uh on behalf of the

06:55committee of the whole of the government

06:57operations, uh standing committee of the

07:00Senate of American Samoa, I uh uh bid

07:05you good morning, good afternoon, and

07:07good evening. I'm pretty sure is pretty

07:10close to uh late afternoon in New York.

07:14Um

07:16to uh

07:22preface our meeting this morning,

07:25uh the government of American Samoa has

07:30endeavored to place

07:33a

07:35alleged investment of $10.1 million

07:39with a firm called McKinley or

07:43[clears throat] McKinley and beach tree.

07:46In the course of our inquiry of this uh

07:52transaction by our government, it has

07:56been discovered that uh there was

08:01supposed to be an insurance

08:05uh placed

08:09for the recovery of the $10.1 million.

08:15if uh anything were to go

08:19bad on uh this alleged investment

08:23scheme.

08:25uh and the name of South Pacific uh

08:29insurance corporation

08:32was uh uh put forward by

08:36>> [clears throat]

08:36>> uh representatives of the American Samo

08:39government who were working on this

08:41investment alleged investment uh scheme.

08:46Uh however in the discovery of uh

08:52the uh documents that uh were received

08:56previously by our committee. Uh we've

09:02found that uh there is there does not

09:06appear to be any insurance premium

09:11securing the recovery of these monies.

09:15uh for fraud against the uh the people

09:20dealing with uh our government.

09:25Uh except that the only thing we found

09:29was a document that appears to be some

09:33form of guarantee

09:36issued under the papers of trades

09:42and uh also reflecting at the end some

09:46sort of a guarantee

09:49uh or offering Sub-Pacific Corporation

09:54uh as a guarantor.

09:57Uh, of course it doesn't say what the uh

10:01South Pacific is guaranteeing

10:04and we uh have had to assume that you

10:08are al that South Pacific is also

10:11guaranteeing the same thing that trade

10:16uh and merchant uh insurance or whatever

10:20the maritime

10:22uh was uh guaranteeing

10:26and Unfortunately, we found that the

10:30guarantee

10:33uh that is not insurance in our opinion

10:37uh that was uh offered is

10:42for any external fraud

10:46uh which specifically exempt

10:51uh any wrongdoing by the partners or

10:54McKinley Beachree the uh the people that

10:58were directly dealing with our

11:01government

11:03and that has raised concern with us.

11:08In our investigation, we found that uh a

11:12premium of $300,000

11:15was supposedly paid to South Pacific

11:19and uh although we cannot and we have

11:24not received confirmation

11:26of that fact. So this morning uh we uh

11:31would like if you will uh South Pacific

11:35to uh

11:38at least inform us what exactly

11:42uh was the deal they made

11:47with the American Samo government or the

11:49governor's office for ensuring the

11:53safety of the investment of 10.1 million

11:57ion dollars that they have allegedly put

12:00in with uh McKinley or McKin McKinley

12:06Beach Street. Uh, and if the government

12:10had paid South Pacific

12:13uh a pre uh premium payment of $300,000,

12:19why is there no insurance policy

12:22insurance ensuring the recovery of these

12:27funds of the American Samo government?

12:31And secondly, we would like to know how

12:37trade and maritime

12:40uh trade insurance uh became involved

12:44because as far as our information goes,

12:49the uh insurance de deal was supposed to

12:54be between the governor's office and

12:56South Pacific Insurance Corporation. So

13:00that's where we're at today. I will uh

13:03uh pass the floor to you gentlemen so

13:06you can at least in uh

13:11inform us exactly uh how this deal with

13:16the American Samo government or whoever

13:19relating to this $10.1 million alleged

13:23investment by American Samo government

13:26with McKinley or McKinley Beach Tree.

13:30gentlemen.

13:32>> Okay, I will uh take the floor for a

13:34moment. I'm going to separate this

13:36response into two. Um

13:39the second part of this I'll I'll defer

13:42to Paul Atkinson. He'll be specific

13:44about our guarantee. Um sir, your

13:48information that you're telling me

13:53is just not true. We've never had a

13:56relationship with the American Samoan

13:59government.

14:00Uh, I've been in business in New York

14:02City since 90 1998.

14:06Um, we are a provider of documentary

14:10letters of credit, standby letters of

14:12credit and guarantees.

14:15uh our broker in Chicago came to us

14:21in order to issue on behalf of an

14:23investment banker a guarantee against

14:27certain fraud that Paul will be specific

14:31because I'm affiliated with Southern

14:33Pacific Insurance Company. I asked them

14:36if they would use their and we do this

14:39on occasion with different insurance

14:41companies. They would use their cash to

14:45literally back our guarantee of external

14:49fraud.

14:50We've never had a relationship with the

14:52American Samoan government. McKinley was

14:56a beneficiary to our guarantee

15:00and I'm not sure whether or not you had

15:03read a questionnaire given to us by the

15:07insurance commissioner but in the

15:09questionnaire I objected to a certain

15:12paragraph

15:13that

15:15asked us to change the character of our

15:18guarantee to reflect a financial

15:20guarantee which it is not.

15:24Since 1998, I have never issued a

15:28financial guarantee. It's just not done.

15:31And in my relationship with Southern

15:34Pacific Insurance Company, we have never

15:36even discussed the financial guarantee.

15:39[snorts] If you'd like to know exactly

15:41what the guarantee is, I'll defer to our

15:43street chief strategist, Paul Atkinson,

15:46and he'll tell you, but I I need to be

15:49clear that this is going on for a week

15:51and a half.

15:53The information that I've received from

15:56the uh through email from the American

16:00Samoa Insurance Commission was I'm just

16:04going to be in layman's terms. It was

16:05crazy.

16:08It was crazy. I'm 76 years old and in

16:10the 30 years that I'm issuing guarantees

16:13for my company, I've never

16:16seen anything quite like the

16:20questionnaire that I received.

16:23So, in order to explain exactly what the

16:25guarantee is, I'll defer to Paul if you

16:27don't mind. Paul, I'll put myself on

16:29mute for a moment if you can explain the

16:31guarantee.

16:34>> So, is it your

16:35>> You're on mute. Is it your information

16:37sir that uh the you have never had any

16:42direct dealings with the American Samo

16:45government represent?

16:47>> That's correct. That is correct. Nor

16:49have I had direct dealings with their

16:51consulting firm McKinley. They were

16:54simply a beneficiary to a guarantee that

16:56we issued. If you'd like to know the

16:58nature of the guarantee, Paul will will

17:01uh speak about it if you if you wish.

17:04So, who who who was your actual

17:08customer that you were offering that

17:11document for?

17:13>> Our customer is an investment banking

17:15firm. I believe they're based in

17:16Chicago, Illinois.

17:19>> Uh they're called they're actually based

17:21in Texas, Marshall, and they're called

17:23Beach Tree Finance Company Limited.

17:27>> I'm sorry.

17:29The company, our applicant was a company

17:32called Beach Tree Finance Company

17:34Limited. and Beach Tree was representing

17:38the investment banker who raised a

17:42private placement

17:44uh to raise the funds that I believe um

17:50uh McKinley invested in and raised uh

17:55funds through the American Simone

17:56government uh for that private

17:58placement.

18:00>> Okay. U now can can either of you u

18:08explain what [music]

18:10external fraud means as far as that

18:15document you gave to uh bitchree.

18:19>> Okay. So the the 10.1 million uh as I

18:23understand was to be placed in an escrow

18:26account with a uh law firm called

18:30Timothy Stein

18:32uh who had escrow uh facilities with

18:36Bank of America and the funds were to be

18:39placed in this escrow.

18:40>> Oh, was it JP Morgan Chase or Bank of

18:42America?

18:43>> Oh, sorry. It was JP Morgan Chase. Yeah,

18:45my my mistake. So it's JP Morgan Chase

18:49and we were approached uh to write a

18:52guarantee for unauthorized depletion of

18:56that escrow account. So whilst the funds

18:59remained in that account, if there was

19:02any external fraud event on that

19:05account, there could be a claim made

19:08against our guarantee. And that was a

19:11guarantee issued by Trade and Merchant

19:13Trade Services LLC.

19:16At no time has SOPAC faced directly

19:19American Simone government. So SOPAC

19:22basically underwrote

19:25our transaction.

19:28All right. My uh other next question is

19:32uh

19:34what was the meaning of the

19:38signature of South Pacific Insurance

19:41Corporation in that

19:43>> I'll answer that

19:44>> document. Simply backing simply

19:47occasionally we um reach out to a

19:51company that's uh heavy with cash to

19:54back certain guarantees that we've

19:56issued. We've done that for um upwards

19:59of um 25 years now. And in this case,

20:03because I am a shareholder of Southern

20:04Pacific Insurance, I reached out um to

20:09see whether it'd be interested in

20:10backing this particular guarantee.

20:13>> So that guarantee is only in favor of

20:16Beach Tree and does not

20:18>> No, it's in favor of McKinley if I may

20:21interrupt. in any manner uh issued for

20:25the benefit of American Samo government.

20:29No, it's u it's in favor, if I may

20:31interrupt, uh of McKinley

20:34and McKinley was presented to us as a

20:37partner of the American Simone

20:39government and we saw a contract between

20:43the American Simone government and

20:44McKinley for that purpose where American

20:48Simone government had given a mandate to

20:50McKinley.

20:53>> I see. And the premium for this

20:56arrangement was paid by Beachree and

21:00McKinley or American Samuel Government.

21:03>> Um it was it was paid to us by our

21:06applicant. Now a lot of this we don't

21:08have a non-disclosure agreement with you

21:10guys. I would have been happy to if I

21:12thought of it. I think it would be inrop

21:15inappropriate to start naming names

21:17here.

21:19>> Uh Mr. Wade, did you ever have any

21:23discussions with uh any representative

21:26of the American Samo government about uh

21:31issuing an insurance policy

21:34guaranteeing the recovery of the $10.1

21:38million if anything were to go wrong

21:41with the purported

21:43uh investment scheme they were

21:46undertaking with uh McKinley or McKinley

21:50beach tree.

21:53>> I I did not personally talk with anybody

21:57uh within the ASG government. Um I know

22:01Norah Tufu was trying to get on the

22:03call. I think at one point

22:05uh I don't know if it was Brett was

22:08trying to confirm some things, but the

22:09early context of that, but I personally

22:11did not confirm or agree that there was

22:14any ever any coverage uh or insurance

22:17coverage in place.

22:20Senator,

22:21>> so the American Samo government never

22:24purchased any uh insurance protection

22:28from your company here in American Samo.

22:31>> That is that is correct. Yeah, this is

22:33SOPAC has strictly just been as as as

22:36Marshall and Paul have explained just to

22:39help support. [clears throat]

22:41So if they have in told the committee

22:44that there is they've purchased

22:47insurance from South Pacific Insurance

22:50Corporation

22:52uh that would guarantee the return of

22:54the $10.1 million by that was put in by

22:59the American Samo government with

23:01McKinley. That would be false. Is that

23:04your

23:05>> That is Yes, that would that would be

23:07correct

23:08>> from my understanding and everything

23:10that I've been involved with.

23:11>> Yeah,

23:22Pacific

23:43Okay, gentlemen, on behalf of the

23:46committee of the whole of the Senate of

23:48American Samoa, I wish to uh extend to

23:52you our appreciation

23:54uh for making time uh to connect with us

23:58and to uh enlighten us about this and we

24:01appreciate very much your candidness and

24:05uh we now have the truth from directly

24:07from you and uh thank you for your

24:10participation this morning and that will

24:12end our

24:13>> senator uh I assure you we are available

24:16as required.

24:18>> Thank you very much.

24:21>> Thank you for your courtesy.

24:23>> Thank you Senator and the committee.

24:26Thank you, Matt.

24:28Yeah.

24:29>> Goodbye. Thank you.

24:31>> Okay.

24:40Trade and maritime trade insurance.

25:03Matt

25:05Pacific

25:15Insurance.

25:19Fore

25:31policy

25:45guarantee

25:48investment.

25:52It's false.

26:21referral for criminal investigations.

27:07External fraud.

27:21Fore!

27:29Foreign! Foreign!

27:52Beach Street

27:57investment guarantee.

28:14appropriation

28:23investment

28:30appropriation.

28:34So violation

28:43Reckless

28:46behavior.

28:56for

29:26I love her.

29:39for

30:10Order. Order.

30:14Acting treasure.

30:27for

30:53recommendation.

30:55Referral

31:04Yeah.

31:22Kelly.

31:53Okay.

32:07The business relationship

32:27tree.

32:34Peach tree. Okay.

32:51contactific.

33:11insurance

33:19investment.

33:46Conclusion

33:49resolution

33:51referral. official.

34:09Prosecutors

34:12referral

34:17Fore

34:46FBI.

35:06referral criminal investigation.

35:15Yeah.

35:22Authoriz

35:28Government Operation.

35:56lawyer.

36:02Referral

36:05authoriz

36:34Authorization.

37:08Yeah.

37:12Yeah.

37:18Recommendation

37:46appropriation power.

37:51Last resort

37:54last resort.

37:59Fore

38:24attorney general.

38:27forchech.

38:57Foreign

38:59speech. Foreign speech. Foreign speech.

39:09for

39:34resolution.

39:34>> The resolution

39:37concuran resolution. Okay.

39:49Recommendation

39:52for an advisory opinion.

40:03Bless

40:07Resolution.

40:11Concurrent resolution.

40:28Fore! Foreign! Foreign!

40:52What is

41:05Okay.

41:07Foreign

41:10speech. Foreign speech. Foreign speech.

41:30investment.

41:50Foreign

41:59speech. Foreign speech. Foreign speech.

42:12invested.

43:18Yeah.

43:36FBI

43:47Is that a federal or money or local

43:49money?

44:04AR

44:22interest.

44:36Interest

44:45power.

44:57appropriation power.

45:03So that's

45:10fraud,

45:12>> potential fraud against

45:32federal investigators

45:35reach out. They will commit

45:41fraud against

45:43but fraud against the territory is fraud

45:46against the department of interior

46:02crimes fraud.

46:07combination

46:16federal agency.

46:19Yeah.

46:40Hello.

47:09Federal

47:40Foreign speech. Foreign speech. Foreign

47:40speech.

48:34Yeah.

48:40Yeah.

48:55Yeah.

49:04Resolution

49:06authorizing

49:10investigating committee.

49:28Yeah.

49:44Favor.

50:06Yeah. Out.