GOVERNMENT OF THE VIRGIN ISLANDS
OF THE UNITED STATES
OFFICE OF THE LIEUTENANTGOVERNOR
VIRGIN ISLANDSBANKING BOARD
CERTIFICATEOFLICENSURE
This is to certify that in accordance with
Virgin
IslandsCode,
Subchapter ,
Section 721, which provides for
licensure of internationalfinancial services
the
Virgin Islandsby the Virgin IslandsBanking Board.
SOUTHERN COUNTRY INTERNATIONAL , LTD
6100 Red Hook Quarter, Suite B3
St. Thomas, VI 00802
filed with the Office of the Lieutenant Governor
Division of Banking
Insurance and
Financial Regulation, all the documents required by law ; has complied with the terms of
Incorporation and laws of the Virgin Islandsas well as federal law , where applicable and has
furnished satisfactory evidence of such characteras to entitle it
conduct business as an
INTERNATIONALFINANCIALSERVICESENTITY
Now . Therefore
I
Tregenza
A. Roach, Esq., Lieutenant Governor und
of the Virgin
Islands Banking Board , pursuant to the authority vested in me do
issue this Certificate of
Licensure in the Virgin Islands of the United States as an international financial services entity.
This Certificate of Licensure is valid from
January 1 2019 10 December 31, 2019 Renewalof
this Certificate of Licensure is required annually upon
its expiration on the
of
December, and itmay be suspended or revoked as provided in
Virgin IslandsCode.
Chapter 25.
1
730.
Given under this
Seal of
Government of the
Virgin
Islands of the
States,
Charlotte
Amalie, St. Thomas,
March, 2019.
FEE
,000
A
TREGENZA A ROACH Esq.
LieutenantGovernor/
Chairman ofthe Virgin Islands Banking Board
9100HAVENSIGHT
SUITE 15
ST. THOMAS, VI
340.
.2564
FAX888. 316 .9269
KFFKLAW . COM
KELLERHALS FERGUSON FLETCHER KROBLIN LLP
March 21, 2013
Via HandDelivery
Mr. John McDonald
Director
Office ofthe LieutenantGovernor
Division of Banking &
Insurance
5049 Kongens Gade
St. Thomas, VI 00802
:
Re:
International Banking Center Regulatory Act
Dear Mr. McDonald :
Enclosed please find the
application for permission to organize an InternationalBanking Entity ( IBE )
filed on
of Financial Strategy Group , Ltd. (“ FSG
.
FSG
respectfully
,
in
addition
to
a waiver of the employment requirement which
is discussed
in
Appendix 11, that it be permitted to commence business with authorized shares of 1 000,000 with a par
of
$ 1. 00 of which at least 100,000 shares shall be issued upon incorporation and $ 100, 000.00 of capital will be fully
paid in at the time the license is issued .
Wepreviously submitted the required application
.
Please do nothesitateto contact ineshould you
any questions.
Very truly yours
Erika
TAMPA
U . S. VIRGIN ISLANDS
NEW YORK
Government of thc
States Virgin Islands
Office of the Commissioner - Division ofBanking
Insurance
# 5049 Kongens Gadc Charlotte Amalic, St
,
. 00802
TEL- 340- 774
FAX340-774-5590
ORIGINAL APPLICATION FOR PERMIT AND LICENSURE OF INTERNATIONAL
BANKINGENTITY
Nameof Proposed InternationalBankingEntity
FinancialStrategy Group
.
E .
To be provided upon formation.
Parentor Affiliate
None
Business Entity and Organization Form : (Attach copies of Article ofIncorporation ;
Article ofOrganization, or partnership agreenient or other written document
establisliing the IBE) (cannot be an individual)
Corporation
Association
Partnership
Subsidiary
Unit
Other (
) .
Please see attached .
5.
PlaceofOrganization or Incorporation and
USVI -
be formed
ProposedLocation (streetand city/town)
9100 PortofSaleMall, Ste 15 St. Thomas, VI00802
Gade,
. Thomas
-6487
340) 774-7166
: (340)
9458
1131King Street, Suite 101, Christiansted,
: (340)773 6459
:
) 719-3801
Page 1 of 8
7 .
PrincipalBusiness Address :
a ) PHYSICAL: Street To
determined
Apt/Suite
City
_ State
Code
Telephonenumber
_
number (
)
b) MAILING: Street/P. O.
9100 Portof SaleMall
Office/Suite#
15
. Thomas
State
Zip Code 00802
Will the organization use a fictitious(DBA)nameto transactbusiness?
If yes,please indicate suchname:
Activitiesthatwillbe engagedby the proposed InternationalBankingEntity:
transaction -related funds, demand
fixed term
and interbank deposit of funds
Commercial lending
Leasing
Services Activities
Brokerage Management services
InsuranceBrokerage
Tradefinancing
Financial Services
and InvestmentAdvice
Clearinghouse
Providea briefdescription of these activities :
Seeattached
(Ifadditionalspace is needed youmayprovideadditionalpage)
5049KongensGade, St. Thomas, VI00802-6487 •
: 340)774-7166
Fax: 340) 774- 9458
1131King Street, Suite 101 Christiansted, VI00820
340 773-6459
340)719-3801
Page 2 of 8
10.
Authorized representativedesignatedby the applicantto file this applicationand/or
to act as its authorized agent for service of process in the Virgin Islandsand/or to
obtain informationregardingthemanagementofthe Company
Name
Erika A . Kellerhals
9100 Port
Sale Mall,
Suite
15, St. Thomas, VI00802
Telephone : 340. 779. 2564
Name:
Address :
Telephone:
Name:
Address:
Telephone:
11.
Explain the organizational structure ofthe proposed InternationalBanking Entity
including thenumber andtitle of the employees whowill commence operations
See attached.
(Ifadditionalspace is needed you
provideadditionalpage)
5049 KongensGade, St. Thomas, VI00802-6487
340)774-7166
Fax: (340 )774-9458
1131King Street, Suite 101, Christiansted, VI 00820
340)773-6459
Fax: 340) 719-3801
Page 3 of8
12.
List thename(s), occupation, address(es), telephonenumber(s) and facsimile
number(s) of each officer and director of the InternationalBankingEntity: (Attach
additionalpages ifnecessary)
NAME
OCCUPATION
ADDRESS
TELEPHONE
&
FACSIMILE
Jeffrey Epstein
President
See attached
See attached.
Darren Indyke
Secretary
Seeattached
Seeattached.
RichardKahn
Treasurer
See attached
See attached .
13.
The name, address, telephonenumberofanypersonwho, directly or indirectly,
possessesor controls or intendsto possess or control 10 percentor more in the
capitalof theproposed internationalbankingentity. (Biographicalaffidavit
required for personsmeetingthis criteria)
NAME
OCCUPATION
ADDRESS
TELEPHONE
CAPITAL
FACSIMILE
Jeffrey Epstein President
Seeattached.
Seeattached.
5049KongensGade, St. Thomas, VI00802-6487
: (340 )774-7166
Fax : (340) 774-9458
1131
Street, Suite 101Christiansted, VI00820
340 773-6459
Fax: (340)719-3801
Page 4 of 8
14.
$ 100,000. 00
$ 0 .00
(a) Capitaland Surplus:
(a )
Stock Company
( 1) Capital
(2) Surplus
(b
Mutual
( 1) Capital
(2)Surplus
(c) Typeof Stock (s) to be Authorized
( 1) Common Stock
(2) Prefered Stock
(d ) Par Value ofEach
by Type
( 1) Common
(2)
( e) Location ofSharesof Shock
Number of Shares
100 000
Selling Price
$ 1. 00
(1)
( )
(b) Ifother than a corporation , describe capital structure:
applicable
(Ifadditionalspaceisneeded you mayprovideadditionalpage)
5049 KongensGade, St. Thomas, VI00802-6487
Tel: 340 )774- 7166
Fax : (340) 774- 9458
1131King Street, Suite 101, Christiansted , VI 00820
340)773-6459
340) 719- 3801
Page 5 of8
15.
Briefly describethenature of the applicant' s businessactivities.
See attached
(Ifadditionalspace is
you may provideadditionalpage)
16 .
State the nameof the entity, location and nameof directors andmain executive
officers of any other applicant ' s affiliates engaged in offshore international
financial business
Location
Nameof
Entity
Directors/ C. E.
.
None
ADDITIONALINFORMATION:
herewith aspartof this application the following documents:
A
Nonrefundable application fee of$ 10,000 madepayable to theGovernment of the
Virgin Islands and;
B . Proposedarticlesof incorporation, partnershipagreementor other written
document establishing the InternationalBanking Entity if such is the case, or the
certificate pursuantto Section 719 (c) of Title 9, VICode, if the International
5049KongensGade, St. Thomas,
00802-6487 •
340 774-7166
Fax: (340) 774-9458
1131KingStreet, Suite 101, Christiansted,
00820
340)773-6459
: (340) 719- 3801
Page 6 of8
Banking Entity isto beorganized as a unitofanother entity.
C .
receivingcertificate from the Division ofCorporationsand Trademarks, a
certified copy of the articlesof incorporation, partnership agreementor other
written documentestablishing the InternationalBankingEntity or the
certification ofthe person ofwhich the InternationalBankingEntity is a unit
D . A copy of thebylawsor internalgoverningagreenientsadoptedby the board of
directors or similar governing body of the internationalbanking entity , which
mustbe certified before a notary public by it secretary or an individual acting in
similar capacity .
E. Corporate resolution authorizingthedesignated person by theapplicantto file
this application.
F. Biographical affidavit of all proposed directors, officers, owners and persons
who intend to act in a managerial capacity, and ofthose who possess or intend to
possess or controlten percent (10 % ) ormore of the interestin the capitalof the
proposed InternationalBankingEntity. (Background investigation willbe done
by the Division)
G . Copy of theapplicant' s audited financial statements for each ofthe Three (3)
years preceding the application.
H . Evidence that thecapitalofthe internationalbanking entity has been subscribed
to , issued and paid- in , to the extent and under such condition as the director
may establish at the Director' s sole discretion .
. Statementof AssetsandLiabilitiesform
J .
A statementauthenticatedbefore a notary public, by theSecretaryof theBoard
of Directorsor thepersonactingin a similar capacity for the international
bankingentity, or for theperson ofwhich the internationalbankingentity is a
unit
NOTE : Theapplicanthereby agrees aslong as theapplication is under consideration that
5049KongensGade, St. Thomas,
00802-6487
: (340
7166
Fax: (340)
- 9458
1131KingStreet,
101 Christiansted, VI00820
(340 773-6459
340)719-3801
Page7 of8
it will:
A . Notify the Director of Bankingand Insuranceofany change in the
information contained herein or in any ofthe documents submitted with or
as partofthis application.
B . Furnish all such additionalinformation and documents in respect to the
Applicant as may be requested by the Director of Banking and Insurance.
This application isan officialdocument and any misrepresentation or failure to
revealinformationrequested by theCommissionerof FinancialInstitutionsmaybe
deemed to be sufficientcause for thedenialor revocation ofa permitor license.
THE UNDERSIGNED,
BEING
DULY SWORN
ACCORDING
TO LAW
AND UNDER THE PENALTIES OF PERJURY STATE
THAT THE INFORMATION GIVEN
IN
THIS APPLICATION IS TRUE AND
CORRECT AND THAT ALL ESTIMATES GIVEN TRUE ESTIMATES BASED
UPON FACTSWHICH HAVEBEENCAREFULLYCONSIDERED AND ASSESSED
Name ERIKA
Date: 08
Signature
Subscribed and sworn to beforemethis
day of
2013
Gregory
Ferguson
NOTARY
LNP012-10
Commision Expires05 /02/2014
Territory
. Virgin Islands
Notary Public
State of:
Commission expires on :
5049 KongensGade, St. Thomas, VI00802-6487
340)774-7166
Fax: 340) 774-9458
1131King Street, Suite 101, Christiansted ,
00820
)773-6459
Fax: 340)719-3801
Page 8 of8
QUESTION 4 ATTACHMENT
DraftArticles ofIncorporation
ARTICLES
INCORPORATION
OF
FINANCIAL STRATEGY GROUP, LTD .
We, the undersigned , for the purposes of associating to establish
a corporation
for the transaction
of the
business and the promotion and conduct of the objects and purposes hereinafter
, under the provisions
and subject to the requirements of the laws of the Virgin
Islands of the United States (
called the
" Virgin
Islands
particularly the General Corporation Law of the Virgin
Islands (Chapter 1, Title 13 Virgin
Islands Code), as the samemay be amended from
time to time, do make and file these Articles of Incorporation
in writing and do certify:
ARTICLE I
The name of the Corporation hereinafter referred to as the "Corporation ) is FINANCIAL STRATEGY
GROUP, LTD.
ARTICLEII
The principal office of the Corporation in the Virgin Islands is
at 9100 Port of Sale Mall, Suite 15 St.
Thomas, U . S . Virgin Islands, 00802 and the
of the resident agent of the Corporation is Business Basics VI,
LLC, whose physical and mailing address
is 9100 Port of Sale Mall, Suite 15,
St. Thomas, U . S. Virgin Islands
00802
ARTICLE III
Without limiting in any manner the
and generality of the allowable functions of the Corporation , and
subject to the provisions of Title
chapter
25 of the Virgin Islands Code, it is hereby provided that the
Corporation shall have the following purposes, objects and powers:
(1) To engage in any lawfulbusiness inthe Virgin Islands.
(
To enterinto and carry out any contracts for or in relation to the foregoingbusiness with any person, firin ,
association ,corporation, government or governmentalagency
(3) To conduct its business in the Virgin Islands and to haveoffices within the Virgin Islands.
(4) To borrow or raise money up to any amount permitted by law by the sale or issuance of obligations ofany
kind, to guarantee loans, other typesof indebtednessand financing obligations,andto secure the foregoing
bymortgagesor otherliensupon
andallofthe propertyof every kindofthe Corporation.
(5) To do alland everything necessary, suitable andproper for the accomplishment ofany of the purposes or
the attainmentof anyofthe objectsor the
ofany of the powersherein set forth, either aloneor in
connectionwith other firms, individuals, associationsor corporations in the Virgin Islandsand elsewhere in
the United
and foreign countries, andto do any other actsor things incidentalor appurtenantto or
TAMPA
.S. VIRGIN ISLANDS
NEW
YORK
growing out of or connected with the said business, purposes, objects and powers, or any part thereof, not
inconsistent with
the laws of the Virgin
Islands, and to exercise any and all powers now
or hereafter
conferred by law on business corporationswhether expressly enumerated herein or not
The purposes, objects and powers specified
in
this Article shallnot be limited or restricted by reference to the
termsof any other subdivision or of any other article ofthese Articles of Incorporation.
ARTICLEIV
The total number of shares of all classes of stock that the Corporation
is authorized
to
is One Million
(1,000,000) shares of which One Hundred
Thousand
(100,000) shares of common stock at $ 100 par value shall
issued upon incorporation. The remaining authorized shares shall be issued by the Board of Directors of the
Corporation who shall determine all rights, preferences and designations at the timeof issuance
The minimum
amount of capital (including additional paid
in
capital) with which the Corporation will commence business is
One Hundred Thousand Dollars ($ 100,000) .
ARTICLE
V
Thenames and places ofresidenceofeach ofthe persons forming theCorporation are as follows:
NAME
RESIDENCE
Erika A
Kellerhals
Brett A .
NicoleMiller
2E - 19 Estate Caret Bay, St. Thomas, VI00802
2 -11B St. Joseph & Rosendahl, St. Thomas VI00802
6E EstateHull, St. Thomas, VI00802
ARTICLE VI
The Corporationisto have
existence.
ARTICLE VII
Forthe inanagementofthe businessand for the conductof theaffairs of the Corporation, and in further
creation, definition, limitationand regulation of the powersof the Corporationand ofits directorsand
stockholders, it is further provided:
The nuinberof directors of the Corporationshallbe fixed by, or in themannerprovided in , the
by-laws, butin no case shallthe numberbe fewer than three (3 ) unlessthe Corporation has fewer
than three stockholders. In this case, the number of directorsmay be equal to
the number of
stockholders. The directors need notbe stockholders.
In furtheranceand not in
limitation of the powers conferredby the lawsof the Virgin Islands,
and subject at all times to the provisionsthereof includingspecifically the provisionsof Title 9,
chapter 25 of the Virgin Islands Code, the Board of Directors is expressly authorized and
cmpowered: Tomake, adoptandamendtheby-lawsof theCorporation, subjectto the powersof
thestockholdersto alter, repealormodifythe by-lawsadoptedby the Board of Directors.
( )
To authorize and issue obligations of the Corporation , secured and unsecured, to include
therein such provisions as to redeemability , convertibility or otherwise , as
Board of
Directors
in
its sole discretion
inay determine, and to authorize the mortgaging or
pledging of, and to authorize and cause to be executed mortgages and
upon any
property of the Corporation ,
or personal, including after acquired property .
To determinewhetherany and, ifany, whatpartof the netprofitsoftheCorporation or
of its net assets in excess of its capital shallbe declared in dividends and paid to the
stockholders, and to direct and determinethe use and disposition thereof.
To set apart a reserve or reserves, and to abolish such reserve or reserves, or to make
such other provisions, if any, as the Board ofDirectorsmay deem
or advisable
for working capital,
for
additions,
improvements and
betterments
to
plant and
equipment, for expansion of thebusiness of theCorporation ( including the acquisition of
real and
personal property
for this
purpose) and for
any other purpose of
Corporation.
To
establish
bonus,
profit-sharing,
pension,
thrift and
other
types
of
incentive,
compensation or retirement plans for the officers and employees including officers and
employees who are also directors) of the Corporation ,and to fix the amount of profits to
be distributed or shared or contributed and the amounts of the Corporation 's funds or
otherwise to be devoted thereto , and to determine the persons to participate in any such
plansand the amounts of
respective participations.
To issue or grant options for the purchase of shares of stock of the Corporation to
officers and employees ( including officers and employees who are also directors) of the
Corporation and on such terms and conditions as the Board of Directorsmay from
time
to timcdetermine.
To cnter into contracts for themanagementofthe businessof the Corporation for terms
notexceeding five (5) years.
To exercise all the powers of the Corporation,
such asare conferred by law , or by
Articles of Incorporation or
by the by-laws of the Corporation upon the
stockholders.
To issue such classes of stock and series within any class of stock with such value and
voting powers and with such designations, preferences and relative, participating, optional
or other special rights, and qualifications, limitations or restrictions thereof as is stated in
the resolution or resolutions providing for the issue of such stock adopted by the Board
of Directors and duly filed with the office of the Lt. Governor of the Virgin Islands in
accordance with Sections
and 97 , Chapter 13, Virgin Islands Code, as the same maybe
amended from
time to time.
ARTICLE VIII
No stockholdershallpledge as collateral for indebtednessany sharesof stock without first obtainingthe written
consentofamajority of the disinterestedmembersofthe BoardofDirectorsof the Corporation.
ARTICLE IX
At all elections of directors, cach stockholdershallbe entitled to as many votes as shall equalthe number of
votes that ( except for such provision as to cumulativevoting) thestockholderwould beentitled to cast for the
clection of directors with respectto his or her shares of stock multiplied by the number of directors to be
elected.
The stockholdermay cast all votes for a single director or distribute them amongany two ormoreof
them
as he or
may see fit. At least
( 10) days priornotice shallbegiven of any meetingof stockholders,
including, withoutlimitation, a meetingfor the electionofdirectors provided, however, that the stockholdersare
entitled to waivenoticeof themeetingas providedby law . Furthermore, themeetingand vote of stockholders
may be dispensedwith, ifallof the stockholderswhowould havebeen entitled to vote upon the action, ifsuch
meetingwere held, shallconsentin writingto such corporate action
taken .
ARTICLE
X
Subject to the provisionsof Section 71, Title 13, Virgin IslandsCode, and Title 9
chapter 12 Virgin Islands
Code, theCorporationmay enter into contractsor otherwisetransactbusinesswith one ormore of its directors,
officers or stockholders, or with any firm
or association of which one or
of its directors, officers
stockholdersaremembersor employees, orwith any other corporation or association ofwhich one ormoreof
its directors, officersor stockholdersare stockholders, directors, officers, oremployees, andno such contractor
transaction shall be invalidatedor in
any way affected by the fact that such director or directors, officer or
officers, or stockholderor stockholdershaveormay have interests therein thatareor mightbe adverseto the
interests of the Corporation
though thevote of the directoror directors, or stockholderor stockholders
havingsuch adverse interest is necessary to obligate the Corporationon such contractor transaction, provided
that in anysuch case thefact of such interestshallbedisclosedor knownto the directorsor stockholdersacting
on or in referenceto such contractor transaction. Nodirector
directors, officeror officers, orstockholderor
stockholdershavingsuch disclosed or known adverse interest shallbe liable to the Corporationor to any
stockholderor creditorthereofor to anyother person for anyloss incurredby it underorby reason ofany such
contract or transaction, nor shall any such director or directors, officer or officers, or stockholder or
stockholdersbeaccountablefor any gainsor profits realizedthereon.
Theprovisionsofthis Articleshallnotbe
construed to invalidateor in any way affectany contractor transaction thatwould otherwisebevalid underlaw .
ARTICLE XI
(a)
The Corporation shall indemnify
any person who was or is a party or is threatened to be made
a party
to
any
, pending , or completed
action , suit , or
proceeding ,
whether
civil,
criminal,
administrative , or investigative (other than an action by or in the right of the Corporation ), by reason
of the fact that he or she is or was a director, officer, employec or agent of the Corporation , or is or
was serving at the request of the Corporation
as a
director, officer , cmployee, or agent of another
corporation , partnership , joint venture, trust, or other enterprise, against expenses ( including attorney' s
), judginents , fines , and amounts paid in settlement actually and reasonably
incurred by him
or her
in connection with such action , suit, or proceeding if:
(1
he or she acted
(A )
in good faith and
(B )
in a manner he or she reasonably believed to be in or not opposed to the
best interests ofthe Corporation; and
( )
with respectto any criminalaction or proceeding, he or she had no
reasonablecause to believe that his orher conductwas unlawful.
The termination
of any action, suit, or proceeding by judgment order, settlement , conviction , or
upon
a plea of nolo contendere
or its equivalent, shall not, of
,
a presumption that the
person did not act in good faith and in a manner which he or she reasonably believed to be in or not
opposed
to the best interests of the Corporation and, with
respect
to any criminal action
or
proceeding , had reasonable cause to believe thathis or her conduct was unlawful.
(b)
Any indemnification under subparagraph (a) (unless ordered by a
court)
shall be
by
the
Corporationonly as authorized in the specific casc upon a determination that he or she hadmetthe
applicable standard ofconductset forth in subparagraph(a).
Such determination shallbe
(1) by
board of directors by a majority vote of a quorum consistingof directors who werc not
parties to such action, suit, or
; or
( ) ifsuch a quorum is not obtainable, or even if obtainable a quorum
of disinterested directors so
directs, by independentlegalcounselin
a writtenopinion; or
( 3) by themajority vote of the stockholders .
(
Expenses incurred in defeating a civil or criminalaction, suit, or proceeding may be paid by the
Corporation in advance ofthe final disposition of such action, suit, orproceedingas authorizedby the
board of directors in the specific case upon
ofan undertakingby or on behalfof the director,
officer, employee, or agentto
repay such amounts unless it shall ultimately be determined that heor
she is entitled to be indemnified by theCorporation asauthorized in this ArticleXI.
Theindemnificationprovidedby this Articleshallnotbedeemed exclusiveofanyother rights to which
those seeking indeinnificationmay be entitled underany bylaw , agreement, vote of stockholdersor
disinteresteddirectors, or otherwise, both as to action in his or her officialcapacityandas to action in
anothercapacitywhile holding such office, and shallcontinueas to a personwho has
to be a
director, officer, employee, or agent and shall inure to
the benefit of the
,
executors, and
administratorsofsuch person.
The Corporationshallhave power to purchase andmaintain insuranceon behalf ofanyperson who is
or was a director, officer, employee, oragent of the Corporation, or is orwas serving at the requestof
the Corporation as a director, officer, employee, oragentof another corporation, partnership, joint
venture, trust, or other enterprise against any liabilityasserted against him or her and incurred by him
or her in any such capacity, orarising out of his orher status as such, whether or not the Corporation
would have the power to indemnify him
or her against such liability under the provisions of this
Article
ARTICLE XII
The Corporation reserves the right to amend alter or repeal any of the provisions of these Articles of
Incorporationand to add or insert other provisionsauthorizedby the lawsof the Virgin Islandsin the manner
and at the timeprescribedby said laws, and all rightsatany timeconferred upon the Board of Directorsand the
stockholdersby these Articles of Incorporationare granted subject to the provisionsofthis Article.
IN WITNESS WHEREOF, wehavehereunto subscribed our names this
January, 2013.
Erika A . Kellerhals, Incorporator
Brett A .
, Incorporator
NicoleMiller, Incorporator
TERRITORY OF THE UNITED STATES VIRGIN
ISLANDS
DISTRICTOF ST. THOMAS AND ST. JOHN
The foregoing instrument was acknowledged before methis
Brett
A
Geary and Nicole Miller.
of January , 2013, by Erika A . Kellerhals,
Notary Public
QUESTION 9 ATTACHMENT
Upon the Directors approval, FSG will engage in the allowable activitiesas provided for under section 726 of
Title 29, chapter 12 ofthe Virgin Islandsstatute, includingbutnotlimitedto:
make, arrange, guarantec
, bond or service loansor other financialundertakingsprovided that
of the loansor financial undertakings may be granted to a domestic person and in the case of
financialsecuritiesfordebt,issue transactions in the U . S. Virgin Islands;
issue, confirm
notice, negotiate or refinance letters of credit if the client and the beneficiary
requesting
of credit is not a domesticperson;
issueconfirm, givenotice, negotiate or refinanceletters of credit in transactions for financing of exports,
even ifthebeneficiary is a domesticperson;
underwrite insuranceforrisks
objects outside ofthe Virgin Islands;
engage in financialand businessmanagementservices;
make commercialloans in excessof $1,000,000 to
U .S. Virgin Islandsborrowers that (i)
been
rejected, or not approved within 30 days from
submission, by any U . . Virgin
Islands financial
institution;or ( )
at an interestrateofnotless than five percentagepoints aboveheFederal
HomeLoan MortgageCorporation's posted
on thelastbusinessday ofthemonth on a thirty-
standard conventionalfixed ratemortgage;
make capitalcontributions in
excess of $1,000,000 to
U . . Virgin Islands business entities in the U . S.
Virgin Islands;
carry out banking transactions permittedby this chapter in the currency of any country, or in gold or
silver, andparticipatein foreign currency trade;
underwrite, issue, distribute, and otherwise deal in securities, notes, debt, instruments, drafts, bills of
exchange, issued by the internationalbanking cntity, or by a forcign person, for final purchase by a
person outsideof
U .S. Virgin Islands;
after obtaining a specialpermit from the
, act as fiduciary, executor, administrator, registrarof
stocksand bonds, property custodian, assignce,
agent or in any other fiduciary capacity; but, such
fiduciary servicesmaynotbe
to, nor inure to thebenefitofdomesticpersons;
acquireand leasepersonalproperty to a person who isa
person including any transactions, atthe
requestof a lessce or seller/lesscc who is a
person, pursuantto a financiallease
, rent
to own, or salc /leasebackagreement, subjectto any regulationsadopted by theDirector;
buy and sell securities and non-life insurance annuities for clients outside the U .S. Virgin Islands, and
provide investmentadvice in relation to such transactions or separatetherefrom, to such persons, and in
addition offer these services and products to the Governmentof the U .S. Virgin Islandsand any of its
instrumentalities, agenciesand investmentvehicles;
organize,manage andprovidemanagementservices to internationalfinancialentities, such as investment
companies and mutualfunds, on the condition that the stock or participation in the
of such
companiesisnotdistributed directly by theIBE to domestic persons; and
with prior authorization from
the Director, provide to other IBEs
to foreign personsor entities
outside of the Virgin
Islands, those services of financial nature, as these are
and generally
accepted in the bankingindustry
United
and the U . . Virgin Islands.
QUESTION 11
Title 9
chapter 35
a) requires
to employ three persons on a full-timebasis at its main office. Section
738
requires that FSG
hire
one additional employee for cvery
$ 1,000 ,000
of net income prior to salaries .
Pursuant to
(a) however, the Director has the ability
to waive this requirement and authorize
a lesser
number of employees
FSG respectfully requests that the requirementthatFSG hire one additionalemployee for every $1, 000, 000 of
netincomebewaived. This requirementshouldbewaived dueto the fact that the activities to beundertakenby
FSG , although they maybe profitable, are notlaborintensive Advances in technologyhavemadebusinesses like
FSG less relianton human capital.
The initialpositions at FSG willincludes an administrative assistant, a financial analyst and an assetmanager.
QUESTION 12
Directors And Officers
Jeffrey
E . Epstein , President
Darren K . Indyke, Secretary
RichardKahn, Treasurer
Background Information:
Jeffrey E. Epstein is theinitial investorin FSG.
Identifying Information
Address:
6100 Red Hook Quarter, B3, St. Thomas, VI00802
Dateof Birth: 01/20/ 1953
BusinessHistory of Applicant:
Mr. Epstein ' s was educated at Thc Cooper Union for the Advancement
of Science and Art. Hebegan
his
business career in 1976 at Bear Stearns
& Company . He subsequently
started his own financial consulting firm
in
1981 which he subsequently moved
to
the
U .S . Virgin
Islands
in
1999, when
he opened
Financial Trust
Company, Inc. (
Epstein is the Chairman , President and sole
shareholder of FTC,
a
financial
consulting
firm
that has been an EDC beneficiary for the past 13
In addition to his and FTC ' s significant
contributions to the U. S . Virgin
Islands economy over the past 13 years, Mr. Epstein , FTC and the philanthropic
foundation
founded , funded and organized have given
over
$ 2 . 3 million to
U . S.
Virgin
Islands charitable
interests, including
$ 1. 1 Million
to
educational pursuits , and
scholarship
and enrichment programs,
and
approximately
$650 ,000
to
local
U . .
Virgin
Islands
charities
and
U . S .
Virgin
Islands youth
sporting
organizations .
The philanthropic
foundation has provided and continues to provide opportunities for scientific
and technological
exploration
and development
in
the
U . .
Virgin
Islands by sponsoring several scientific
symposiums
in
the
U. S .
Virgin
Islands
enabling
local
interaction
among Nobel Laureates
and
faculty
postdoctoral researchers, graduate and undergraduate students , educators and thepublic.
Mr. Epstein
is an experienced and successful financier and businessman . He is universally renowned for his
complex mathematics skills and is an exceptional entrepreneur who has built severalhighly profitable companies.
He has successfully transferred these skills to the world of high finance, having
one of the pioneers of
derivative and option-based investing He looks now to shift his focus to the dynamic discipline of international
banking. His global relationships in
upper echelon of international finance and business, and his highly
sophisticated knowledge of
finance,
science and mathematics will enable the Applicant to
thrive
in
this
competitive environment.
Mr. Epstein was formerly a Trustee of the Scholar Rescue Fund of the Institute of InternationalEducation
Inc.
. Epstein was formerly a member of
of the Trilateral Commission, the Council on Foreign
Relations, and the New
York Academy of Science and is also a former Rockefeller University Board Member.
Mr. Epstein has been actively involved in the Santa Fe Institute the Theoretical Biology Initiative atthe Institute
for Advanced Study, and the Quantum Gravity Program at the University of Pennsylvania, and also sat on the
Mind, Brain & Behavior Advisory CommitteeatHarvard.
Darren K . Indyke:
575 LexingtonAvenue, 4th Floor
New York, New York 10022
EDUCATION
Colgate University, Hamilton, New
York
Bachelor of Arts, May 1986
Economics and Education
Cornell Law School Ithaca, New
York
Juris Doctor,May 1991
Business Law Concentration
Admission to Practice Law
-New
York State, 1992
ASSOCIATIONS
New York State Bar Association
RichardKahn
575 Lexington Avenue, 4th Floor
New
York , New York 10022
EDUCATION
Pace University, New York ,New
York
Masters in
Taxation, May 1999
Syracuse University, Syracuse, New
York
Bachelor of Science,May 1994
Certified Public Accountant, 1995
ASSOCIATIONS
American Institute ofCertified Public Accountants
New
York State Society ofCertified Public Accountants
QUESTION 13
Sec Jeffrey E . Epstein information in responseto Question 12
QUESTION
15
to Question 9 .
BIOGRAPHICAL AFFIDAVIT
(International Banking Entity)
FullName and Address of Company (DoNotUse Group Names.)
l inancialStrategyGroup, Ltd.
In connection with the above-named company, I herewith makerepresentations and supply
information aboutmyself as hercinafter
forth. (
addendum or separate
ifspace heron
is insufficient to answerany question fully.) IF ANSWER IS "NO" OR "NONE", SO
STATE
Affiant sFullName(Initials NotAcceptable) Jeffrey Edward Epstein
.
No.
Have you everhad your name changed?
Ifyes,
the reason for the change.
Other names used at any time.
b
Affiant's SocialSecurity Number.
Dateand PlaceofBirth
01/ 20 / 1953
York
Affiant s Business Address.
RedHook Quarter B3, St. Thomas, VI00802
Business Telephone.
340.779.2564
Listyour residences for the last ten (10) years starting with your current address, giving
DATE
1996-Present
ADDRESS
Little St. James
CITY AND STATE
St. Thomas, VI
Current Residence Telephone. 340.775.2525
A . Please providedetails of your education:
DATE
DEGREE
LOCATION
College/ SchoolName:
College: Nodegreeawarded.
Graduate : N / A
Other: N / A
B . Indicate if you haveany particular training related to banking business and/ or securities,
investment or finance.
Mr. Jeffrey Epstein began his
calculus and physics at the high school level
and transitioned in 1976 to his lucrative business career atBear Stearns & Company.Helater
founded his own financial consulting firm
in 1981
which
brought to the Virgin
Islands
in
1999 when he opened Financial
Company, Inc. (“
).
was a successful
Virgin
Islands business and
a beneficiary
of the Economic Devclopment Commission
(
)
. Epstein is also the sole shareholder ofSouthern Trust Company, Inc. (
which
has been recommended for benefits from
and is awaiting the signature of
the Governor. Mr. Epstein has
a resident of the US Virgin Islands
1996 .
Mr. Epstein is an
experienced
and successful financier and businessman . He is universally
renowned
for his complex mathematics skills and
is an exceptional entrepreneur who has
built several highly profitable companies . He has successfully transferred these skills to the
world
of high
finance, having been
one of the pioneers of derivative
and
option -based
investing .Helooks
shift his focus to the dynamic discipline of international banking
His global relationships in the upper echelon of international finance and business , and his
highly
sophisticated
knowledge
of
finance,
science
and mathematics
will
the
Applicant to thrive in this competitive environment .
ListMembership in Professional Societies and Associations.
Mr. Epstein
was
formerly
a
Trustee of the Scholar Rescue Fund of the
Institute of
International Education
. Mr. Epstein was formerly a
of each of the Trilateral
Commission , theCouncil on
, and the New
York AcademyofScience and
is also
a former Rockefeller University
Board Member . Mr. Epstein
has been actively
in
the Santa Fe Institute , the
Thcorctical Biology
Initiative at the Institute for
Advanced Study, and the Quantum Gravity Program at the University of Pennsylvania , and
also sat on theMind, Brain
& Behavior Advisory Committee at Harvard
9 .
Presentor Proposed Position with the Applicant Company . President and Sole Stockholder
Statethe estimated amountoftimeyou will devoteworkingfor the financialinstitution(e.
director, partner, manager, officer, stockholler
hours per week.
11.
Listcomplete employment record (up to and including present jobs, positions, directorates
or officerships) for the past twenty (20 ) years. Self- employed.
12.
Presentemployer
be contacted.
N / A
employers may be contacted . N / A
13.
Indicateassets and liabilityofany applicantandofanypersonwho possessesor controls or
intendsto possessor control10 percentor
in the capitalof the proposed international
bankingentity, or of the personofwhich theproposed internationalbanking entity is to be a
unit for cach of the threeyears preceding
application. (see attached Statementof Assets
and Liability
to becompleted).
In order to preserve the confidential nature ofMr. Epstein ' s financial information, we are
respectfully requesting that we be afforded the opportunity
to meet with representatives of
the Division of Banking and Insurance and provide a statement of assets and liabilities for
review .
14.
(a)
Have you ever been in a position ,which required a fidelity bond? If any claimswere
made on the bond give details .
No
(b )
Haveyou ever been denied an individualorposition schedule fidelity bond, or had a
bond cancelledor revoked?
No.
15 .
Listany professional, occupational, andvocationallicenses issuedby anypublic or
governmentallicensingagencyorregulatory authority, which you presently hold or haveheld
in thepast (place and date , license issued, issueroflicense,
terminated, reasonsfor
termination)
At thebeginningofhiscareer, Mr. Epstein held variousprofessionalcertifications, including
the Series7 and Series63. Hehasnotheld these certificationsin over thirty years.
16.
Duringthe last ten (10) years, haveyou everbeen refused a professional,occupational, or
vocationallicense by
publicor governmentallicensingagency
regulatory authority or
has any such licenseheld by you cverbeen suspendedorrevoked?No.
17.
List any financial institution in which you control directly or indirectly or own legally or
beneficially outstanding stock , participation or have an interest and thepercentage of
ownership
Ifanyofthe stock is pledged or hypothecated in any way, give details .
18.
Will you ormembers of your immediate family subscribe to or own, beneficially or of
record, shares of stock of the applicant financial institution or its affiliates? If any of the
shares of stock are pledged or hypothecated in anyway, give details.
Mr. Epstein willbethe initialsole shareholder.
Have you ever filed bankruptcy?No.
a . Haveyou everbeen arrested, detained, charged, convicted or had a sentence imposed or
suspended orhadpronouncementofa sentence suspended orbeen pardonedforconviction
of orpleaded guilty or nolo contendere to an information or indictment charging any felony,
or charging a misdemeanorinvolving embezzlement, theft larceny, ormailfraud ,or
charginga violation ofany corporatesecurities statute oranyinsurancelaw, or have
proceedingsofany federalorstate regulatory agency?
For a relatively brief period in what has otherwise
a productive and accomplished life,
Mr. Epstein did face some legal difficultiesrelating to matters alleged to have taken place
seven years ago exclusively within
Beach County, Florida. The Palm
Beach County
Sheriff's Office and the Palm
Beach County State Attorncy
a local investigation
ofMr. Epstein in 2005 rclating to such matters. An investigation was also conducted by the
United States Attorney's Office for
Southern DistrictofFlorida and the
Bureau
of Investigation in 2007 relating to the
localmatters investigated by the
Beach
authorities. The
investigation was discontinued in 2008 without the issuance ofany
charges.
Nothing for which Mr. Epstein was investigated had any relation
whatsoever to the business or industry ofMr. Epstein or the Applicant.
On June 30, 2008, before the Florida Circuit Court forthe 15th JudicialCircuit located in
Palm
Beach Florida, Mr. Epstein pleaded guilty to and was convicted of,
count of
solicitation ofprostitution andone countofprocuringprostitution of a person under the age
of 18. He served 13 months of an
18-month sentence in the Palm
Beach County Jail,
followedby enhancedprobation, which he completed over two years ago. There have been
no
allegations or charges ofanymisconductbyMr. Epstein since that period of time
seven
ago. Nothing to which Mr. Epstein
guilty and was convicted had any
relationwhatsoever to the business or industry ofMr. Epstein or theApplicant.
b.
any company been so charged, allegedly as a result of any action or conduct on your
part?
.
21.
Haveyou ever been an officer, director, trustee, investmentcommitteemember, key
, or controllingstockholderofany financialinstitutionwhich, while youoccupied
any such positionor capacitywith respectto it, becomeinsolvent/ bankruptorwas under
supervisionor in receivership, rehabilitation, liquidationor conservatorship?
No.
22.
Haveyou declared bankruptcy, orhasan assignmentever beenmadefor the benefitofyour
creditors?
No.
23
Haveyou been permanentlyor temporarily enjoined from engaging
continuingany
conductorpractice related to any businessby any competentcourtor governmententity in
any country?
No
24
Provide two (2) references of personswho have known you for (5 ) five years ormorc Do
notinclude relatives, present employer or employees or bank references.
James E . Staley
Andrew Farkas
25 .
Providethree (3) bank references:
J. P . Morgan Chase &
Co.
First Bank
[signature page to follow
Datedand signed this
day ofMarch 2013atNew York. I hereby certify underpenaltyofperjury
that I am
actingonmyown behalfand that the foregoingstatementsare trueand correctto thebest
ofmyknowledgeandbelief.
Signature ofaffiant
STATE OF NEW YORK
ACKNOWLEDGMENT
COUNTY OFNEW YORK
instrumentwas acknowledgedbeforemethis 20th day ofMarch, 2013, by Jeffrey E .
Epstein, who is personallyknown tome.
Notary Public
MyCommissionExpires:
HARRY 1
Notary Public ,
ofNew
York
Qualified in Rockland County
Commission Expires
Corp No. 584624
GOVERNMENT OF
THE VIRGIN ISLANDS OF THE UNITED STATES
CHARLOTTE AMALIE,ST. THOMAS, VI00802
To
These Presents Shall Come:
1the undersigned ,LIEUTENANT GOVERNOR ,DO hereby certifies that
FINANCIAL STRATEGY GROUP, LTD .
Business Corporation
of the Virgin Islands filed in my office on April 4, 2014 as provided for by law Articles of
Incorporation, duly acknowledged
WHEREFORE the persons named in said Articles, and whohave signed the same, and their
, are herebydeclared to be from the late aforesaid, a BusinessCorporation by thename
and for the purposes set forth in said Articles, with the rightofsuccession as therein
Witness myhand and the seal of the Government of the
Virgin Islands of the United States, at Charlotte Amalie , St.
Thomas, this 10th day of September , 2014.
GREGORY R. FRANCIS
Lieutenant Governor of the Virgin Islands
FORM
OFTHE
THE UNITED STATES VIRGIN ISLANDS
OFFICE OF THE LIEUTENANT GOVERNOR
DIVISION OFCORPORATIONS AND TRADEMARKS
UNITED
.
SES
Teritory
of
the
U.
S.
Virgin
Islands
Creation
-
Corporation
-
Domestic
7
Page
(
s
)
RESIDENT AGENT FORM
CONSENT OF AGENT FOR SERVICE OFPROCESS
T1425318102
This writing witnesseth that
undersioned Business Basics VI, LLC
having been designated by FinancialStrategy Group, Ltd.
as residentagentof said company, upon whom service of processmaybemade
all suits
arising against said companyin the Courtsof the UnitedStates Virgin Islands, dohereby consent
to act as such agent and that service of process may bemade upon me in accordance with
2014
Title 13, Virgin IslandsCode,
this
IN
WITNESS
WHEREOF
have
hereunto
set my
signature
April
2014
DECLARE, UNDER PENALTY OFPERJURY, UNDER THE LAWSOF THE UNITEDSTATESVIRGIN
ALL STATEMENTSCONTAINED IN THIS APPUCATION, AND ANY
ACCOMPANYING DOCUMENTS, ARE TRUE AND CORRECT, WITH FULL KNOWLEDGETHAT
STATEMENTS
THIS APPUCATION ARE SUBJECTTO INVESTIGATION
AND THATANY FALSEORDISHONESTANSWER TO ANY QUESTIONMAY
GROUNDSFORDENIALOR SUBSEQUENT
OF REGISTRATION.
2541794
SIGNATURE OF RESIDENTAGENT
DAYTIMECONTACT NUMBER
MAILING ADDRESS
340 .776 .8812
9100 Portof SaleMall, Ste 15 St. Thomas, VI 00802
9100 Portof Sale Mall, Ste 15 St. Thomas, VI00802
info @ businessbasicsvi.com
PHYSICALADDRESS
EMAIL ADDRESS
NOTARY ACKNOWLEDGEMENT
2014
Subscribed and swom
to before methis
April
St. Thomas
Notary Public
Brett
A
Notary Public
-
11
. Thomas St John,USVI
MyCommissionExpires:
21, 2013
-
MyCommission Expires
ARTICLESOF INCORPORATION
FINANCIALSTRATEGYGROUP, LTD.
We,
the undersigned , for the purposes of associating to
establish a corporation
for the
transaction
of the
business and the promotion and conduct of the objects and purposes hereinafter stated ,
the provisions
and subject to the requirements of the laws of the Virgin
Islands of the United States (hereinafter
called the
" Virgin Islands
, and particularly the General Corporation Law ofthe Virgin Islands (Chapter 1, Title 13, Virgin
Islands Code), as the same may be amended from time to time, domake and file these Articles of Incorporation
in writing and do certify :
ARTICLE I
The nameof the Corporation (hereinafter referred to as the " Corporation ) is FINANCIAL STRATEGY
GROUP, LTD.
ARTICLE II
The principal office of the Corporation
in the Virgin Islands is located at 9100 Port of Sale Mall, Suite 15
St.
Thomas, U . S. Virgin Islands 00802, and the nameofthe resident agent of the Corporation is Business Basics VI,
LLC, whose physical andmailing address is 9100 Port of Sale Mall, Suite 15, St. Thomas,
U . S .
Islands
00802
ARTICLE III
Without limiting in any manner the scope and generality
of the allowable
functions of the Corporation ,
and
subject to
the provisions of Title
9
chapter 25 of the Virgin
Islands Code, it is hereby provided
that the
Corporation shall have the following purposes, objects and powers:
(1)
To
engage
in any lawful business in the United States Virgin
Islands, including the operation of an
internationalbanking entity in accordancewith Title 9 , chapter 25.
(2 )
To enter into and carry outany contracts for or in relation to the foregoing business with any person, firm ,
association, corporation, governmentor governmentalagency.
( 3)
To conduct its business in the United States Virgin Islandsand to have offices within the United States
Virgin Islands
(4)
To borrow orraisemoney to any amountpermitted by law by the sale or issuanceof obligations ofany kind,
to guarantee loans, other types of indebtedness and financing obligations, and to secure the foregoing by
mortgages or other liensupon any and all oftheproperty ofevery kind oftheCorporation .
(5)
To do all and everything necessary, suitable and proper for the accomplishmentof any of the purposes or
the attainment of any of the objects or the exercise of any of the powers hercin set forth, either alone or in
connection with other firms, individuals, associations or corporations in the Virgin Islands and elsewhere in the
United States and foreign countries, and to do any otheractsor things incidentalor appurtenantto or growing
out of or connected with the said business, purposes, objects and powersof any part thereofnot inconsistent
with
the lawsof the Virgin Islands, and to exercise any and all powers now or hereafter conferred by law
on
business corporationswhether expressly enumeratedhereinor not.
The purposes, objects and powers specified in this Articleshall notbe limitedorrestricted by referenceto the
termsofany othersubdivision orof any other article ofthese ArticlesofIncorporation.
ARTICLE
IV
The totalnumber of shares of all classes of stock that the Corporation is authorized to issue is OneMillion
(1,000,000) shares of common stock at$5.00 par value; no preferred stock authorized
The minimum
amount of capital with which
the Corporation will commence business
is
Five Hundred
Thousand Dollars($ 500 ,000.00).
ARTICLE V
Thenamesandplaces of residence ofeach ofthe persons forming the Corporation are as follows:
NAME
RESIDENCE
Erika A . Kellerhals
Brett A . Geary
NicoleMiller
2E -19 Estate Caret Bay, St. Thomas, VI00802
2 - 11B St. Joseph
& Rosendahl, St. Thomas, VI 00802
6E Estate Hull, St Thomas, VI 00802
ARTICLE VI
CC 2014
:
-
The Corporation is to haveperpetualexistence.
.
ARTICLEVII
Forthemanagement of the business and for the conduct of the affairs of the Corporation ,and in further
creation , definition, limitation and regulation of thepowers ofthe Corporation andofitsdirectors and
stockholders, it is further provided :
1
The numberof directors of the Corporation shall be fixed by, or in the manner provided in , the
by- laws, but in no case shall the numberbe fewerthan three (3) unless the Corporationhas fewer
than three shareholders. In this case the number of directors may be equal to the number of
shareholders. The directors need notbe stockholders.
In furtherance and not in limitation of the powers conferred by the lawsof the Virgin Islands,
andsubject at all times to the provisionsthereof, the Board ofDirectors is expressly authorized
andempowered:
(a
To make, adopt and amend the by-laws ofthe Corporation, subject to the powers of the
stockholders to alter, repealormodify the by-laws adopted by theBoard ofDirectors.
To authorize and issue obligations of theCorporation, secured and unsecured, to include
therein such provisions as to redeemability, convertibility or otherwise, as the Board of
Directors in
its
sole discretion may determine, and to authorize
the mortgaging or
pledging of, and to authorize and cause to be executed mortgages and liens upon any
property oftheCorporation, real or personal, including after acquired property.
To determine whether any and, if any, what part of the net profits of the Corporation or
of its net assets in excess of its capital shall be declared
in dividends and paid to the
stockholders , and to direct and determine the use and disposition thereof.
To set apart a reserve or reserves, and to abolish such reserve or reserves, or to make
such other provisions, if any, astheBoardofDirectorsmay deem necessary oradvisable
for working capital,
for
additions, improvements
and betterments
to
plant and
equipment, for expansion of the business of the Corporation including the acquisition of
real and personal property for
this purpose)
and
for
any other
purpose of the
Corporation.
(
)
To
establish bonus,
profit-sharing,
pension,
thrift and
other
types
of incentive,
compensation or retirement plans for the officers and employees including officers and
employees who are also directors) of the Corporation, and to fix the amountof profits to
be distributed or shared or contributed and theamounts of the Corporation's funds or
otherwise to be devoted thereto, and to determine the persons to participate in any such
plans and the amounts oftheir respectiveparticipations.
To issue or grant options for the purchase of shares of stock of the Corporation to
officers and employees includingofficers and employeeswho are also directors) of the
Corporation and on
terms and conditionsasthe Board of Directorsmay from time
to time determine.
To enter into contracts for the management of the business of the Corporation for terms
not exceeding five (5) years.
To exerciseall the powers ofthe Corporation, exceptsuch as are conferred
, orby
these Articles of Incorporation or by the by-laws of the
upon the
stockholders.
To issue such
classes of stock and series within any class of stock with
such value and
voting powers and with such designations, preferences and relative, participating, optional
or other special rights, and qualifications , limitations or restrictions thereof as is stated in
the resolution or resolutions providing for the issue of such stock adopted by the Board
ofDirectors and duly filed with the office of the Lt. Governor of the Virgin Islands in
accordance with Sections 91and 97 ,
13, Virgin IslandsCode, as the samemay be
amended from
time to time.
ARTICLE VIII
No stockholder shall pledge as collateral for indebtedness any shares of stock without first obtaining the written
consent of a majority of the disinterested members of the Board of Directors of the Corporation.
ARTICLE IX
At all elections of directors,
stockholder shall be entitled to as many votes as shall equal the number of
votes that ( except forsuch provision as to cumulative voting) the stockholderwould be entitled to cast for the
election of directors with respect to his or her shares of stock multiplied by the number of directors to be
elected.
The stockholdermay cast all votes for a single director or distribute them among any two ormore of
them as he or shemay see fit. At least ten (10) days notice shall be given, however the shareholders are entitle to
waive notice of themeeting as provided by law. Furthermore, themeeting and vote of stockholders may be
dispensed with, if allof the stockholderswho would have been entitled to vote upon the action if such meeting
were held, shallconsent in writing to such corporate action being taken.
ARTICLE X
Subject to the provisionsofSection71, Title 13, Virgin IslandsCode, the Corporationmay enter into contracts
or otherwise transact business with one or more of its directors or officers, or with any firm or association of
which one or more of its directors or officers are members or employees, or with any other corporation or
association ofwhich oneormore of its directors or officersare stockholders, directors, officers, or employees,
and no such contractor transaction shallbe invalidated or in any way affectedby thefactthat such directoror
directors or officerorofficershaveormayhave intereststherein thatare ormightbeadverse
the interestsof
the Corporationeven though the vote of the directoror directors having such adverse interest is necessary to
obligate theCorporation on such contract or transaction, providedthat in any such casethefactof such interest
shall be disclosed or known to the directorsor stockholders acting on or in reference to such contractor
transaction. No directoror directorsor officer orofficershavingsuch disclosedor knownadverse interestshall
be liable to
the Corporation or to any stockholder or creditor thereof or to any other person for any loss
incurredby it underor by reason of any such contractor transaction, nor shall any such director or directors or
officeror officersbeaccountablefor any gainsor profits realized thereon
The provisionsof this Article shall
notbe construed to invalidateor in any way affect any contract or transaction that would otherwisebe valid
underlaw
ARTICLEXI
The Corporation shall indemnify any person who was or is a party or is threatened to bemade a party
to
any
threatened , pending, or completed
action,
suit,
or proceeding ,
whether
civil
,
administrative , or investigative (other than an action by or in the right of the Corporation ) by reason of
the fact that he or she is or was a director, officer, employee, or agent of the Cofforation , of is or was
serving at the request
of the
Corporation
as a director, officer,
employee, cor agent of
another
corporation , partnership , joint venture, trust, or other enterprise, against expenses
attorney ' s
fees), judgments , fines, and amounts paid in settlement actually and reasonably incurred by him
or her
in connection with such action, suit,orproceeding if:
(1)
heor she acted
( A )
in good faith and
(B)
in amannerreasonablybelieved to be in or notopposed to the
best interests ofthe Corporation; and
( 2)
with respect to any criminalaction or proceeding,heor shehadno
reasonable cause to believe hisorher conductwasunlawful.
The termination of any action, suit, or proceeding by judgmentorder, settlement, conviction, or
upon
plea ofnolo contendere or its equivalent, shall not, of itself, create a presumption that the
person did notact in good faith and in amannerwhich heor she reasonablybelieved to be in or not
opposed to the best interests of the Corporation and, with respect to any criminal action or
proceeding, had reasonable cause to believethat his conductwas unlawful.
(b)
Any indemnification under subparagraph (a) ' unless ordered by a court) shall be made by
the
Corporation only as authorized in the specific case upon a determination that he or she hadmet the
applicablestandardofconductset forth in subparagraph (a). Such determinationshallbemade:
(1 by the board of directors by a majority vote of a quorum consisting of directors who were not
parties to such action, suit, or proceeding; or
(2) if such a quorum
is not obtainable, or even if obtainable a quorum of disinterested directors so
directs, by independent legal counsel in a written opinion ; or
(3) by the stockholders .
)
Expenses incurred in defeating
a civil or criminal action, suit , or proceeding may be paid by the
Corporation
in advance of the final disposition of such action, suit, or proceeding as authorized by the
board ofdirectors in the specific case upon receiptof an undertaking by or on behalf of the director,
officer , employee, or agent to repay such amounts unless it shall ultimately be determined that he or
she is entitled to be indemnified by the Corporation asauthorized in this article.
The indemnification provided by this Article shallnotbe deemed exclusive of any other rights to which
those seeking indemnificationmay be entitled under any bylaw , agreement, vote of stockholders or
disinterested directors, or otherwise, both as to action in his orher official capacity and as to action in
another capacity while holding such office, and shall continue asto a person wh
to be a
director, officer, employee, or agent and shall inure to
the benefit of the
,
, and
administrators ofsuch person.
The Corporation shall have power to purchase and maintain
insurance on behalf
any person who is
or was
a director, officer, employee, or agent of the Corporation , or is or was
at the request of
the Corporation as a director, officer, employee , or agent of another corporation , partnerskip
joint
venture, trust, or other enterprise against any liability asserted against him
or
by him
or her in any such capacity, or arising out of his or her status as such, whether
not the Corporation
would have the power to indemnify
him or her against such liability under the provisions of this
Article
ARTICLE XII
The Corporation
reserves the right to amend,
alter or repeal any of the provisions of these
Articles of
Incorporation and to add or insert other provisions authorized by the lawsof the Virgin Islands in the manner
and at the time prescribed by said laws, and all rights at any time conferred upon the Board ofDirectors and the
stockholders by these Articles of Incorporation are granted subject to the provisions of this article.
IN WITNESSWHEREOF,we havehereunto subscribed ournames this 3rd day of April, 2014.
Erika A . Kellerhals, Incorporator
BrettA .Geary, Incorporator
Nicole Miller, Incorporator
TERRITORY OF THEUNITED STATES VIRGIN ISLANDS
DISTRICTOF ST. THOMAS AND ST. JOHN
The foregoing instrumentwas acknowledged beforemethis 3rd day of April, 2014, by Erika A . Kellerhals, Brett
A . Geary andNicoleMiller.
Notary Public
2014
NOTARX PUBLIC NP-
- 13
COMMISSION
/
/
ST
THOMAS ST JOHN ,
GOVERNMENT OF
THE VIRGIN ISLANDS
THE UNITED STATES
CHARLOTTEAMALIE, ST. THOMAS
To All To Whom
These Presents Shall Come
I, the undersigned, LIEUTENANTGOVERNOR,do hereby certify that
FINANCIAL STRATEGY GROUP, LTD.
of the Virgin Islands filed in myoffice on March 25, 2015as provided for by law ,
Amended Articles of Incorporation, duly acknowledged; and that a
duplicate
originalthereofhasbeen filed in
Office ofthe Clerkofthe District Court of the
Virgin Islands;
WHEREFORE the said Amended
Articles are hereby declared to have been duly
recorded in this Office on the date aforesaid, and to be in full force and effect from
that date.
Witnessmyhand and Seal of the Government
of the Virgin Islands of the United States, at
Charlotte Amalie, St. Thomas, this 13th day
ofMay 2015
OSBERT E POTTER
LieutenantGovernorfor the Virgin Islands
GOVERNMENT OF
THE VIRGIN ISLANDS OF THE UNITED STATES
CHARLOTTE AMALIE,ST. THOMAS,VI 00802
To Whom
These Presents Shall Come:
I the undersigned, LIEUTENANT GOVERNOR , do hereby certify that
FINANCIAL STRATEGY GROUP
.
a Virgin Islandscorporation, filed in the Office of the Lieutenant Governor on March
25
2015
provided
for by law ,
Certificate
of Amendment
Articles of
Incorporation, duly acknowledged ; changing its name to
SOUTHERN COUNTRY INTERNATIONAL LTD.
WHEREFORE the said Amendment is
declared to have been duly recorded in
this office on the aforesaid and to be in full force and effect from
that date.
Witness my hand and the
seal of
the
Government of the United States Virgin
Islands, at Charlotte Amalie, this 13th day of
May, A . D . 2015.
OSBERT E POTTER
Lieutenant Governor of the Virgin Islands
CORRECTED
AMENDMENT
TO THE
ARTICLESOF INCORPORATION
FINANCIAL STRATEGYGROUP, LTD.
We, the undersigned, do hereby adopt the following amendments to the Articles of Incorporation of Financial
Strategy Group,Ltd.:
Article Ishall be deleted in its entirety and amended to read as follows:
ARTICLE
I
The name of the Corporation (hereinafter referred to as the"Corporation") is SOUTHERN COUNTRY
INTERNATIONAL LTD.
Article
shall be deleted in its entirety and amended to read asfollows:
ARTICLE IV
The totalnumberofsharesofall classes ofstock that the Corporation is authorized to
is One Hundred
Thousand (100,000) shares ofcommon stock at$5.
par valueand OneHundred Thousand (100,000) shares of
preferred stock at $1.00 parvaluewith an 8 % coupon.
The minimum amount of capital with which the Corporation will commence business is Five Hundred
Thousand Dollars($500,000).
-
signature page follows]
IN WITNESS WHEREOF,we havehereunto subscribed
names this 18th day of December, 2015.
Jeffrey E. Epstein, President
Indyke, Secretary
Richard Kahn, Treasurer
TERRITORY OF THE UNITED STATES VIRGIN ISLANDS
DISTRICT OF ST. THOMASAND ST. JOHN
The foregoing instrument was acknowledged before me this
Epstein
of December, 2015, by Jeffrey E
Notary Public
STATE OF NEW
YORK
COUNTY OF NEW
YORK
The foregoing instrumentwas acknowledgedbeforemethis
and RichardKahn.
December, 2015, by Darren K . Indyke
Habibe
Notary Public
HABIBE AVDIU
NOTARY PUBLIC -STATE OF NEW
YORK
No,
RichmondCounty
Commission
October 14, 2018
OVER
THE UNITED STATES VIRGIN ISLANDS
OFFICE OF THE LIEUTENANT GOVERNOR
DIVISION OFCORPORATIONSAND TRADEMARKS
5049KongensGade
1105KingStreet
CharlotteAmalle, Virgin Islands00802
Christiansted,
Islands00820
-
.776.8515
Phone - 340.7736449
Fax - 340.776.4612
Fax - 340.773.0330
FRANCHISE TAX REPORT - DOMESTIC CORPORATION
CORPORATE FILINGSAND REQUISITE TAXES ARE DUE, EACH YEAR , ON OR BEFORE JUNE
AVOID PENALTIES AND INTERESTBY PAYING ON TIME.
TODAY' SDATE
TAX CLOSING DATE
6 /30/2018
12/31/2017
66-0821138
EMPLOYER IDENTIFICATION NO . (EIN )
SECTION 1
CORPORATIONNAME
PHYSICAL ADDRESS
MAILING ADDRESS
Southern Country International, Ltd. (formerly FinancialStrategy Group, Ltd.)
6100 RedHook Quarter, B3, St. Thomas, U .S. Virgin Islands 00802
6100 RedHook Quarter, B3, St. Thomas, U. S. Virgin Islands 00802
4
4 / 2014
International Banking Entity
DATEOFINCORPORATION
NATURE OF BUSINESS
SECTION 2
CAPITAL STOCK AUTHORIZED ON LAST FILED REPORT
CAPITAL STOCK AUTHORIZED ON THIS DATE
1 000,000 shares,
common stock $ 6.00
. GOV. CORP
$ 500 ,000
SECTION 3
IN CAPITALSTOCK USED IN CONDUCTINGBUSINESS
A .
AS SHOWN ON LASTFILEDREPORT
B
ADDITIONALCAPITALPAID SINCE LAST REPORT
C
SUM OF
A ' AND ' ' ABOVE
PAID - IN
CAPITALWITHDRAWNSINCELASTREPORT
E.
PAID-IN CAPITAL STOCKATDATEOF THIS REPORT
F
HIGHEST TOTAL PAID-IN CAPITALSTOCKDURING REPORTING PERIOD
$ 34,662
,
RECEIVED
534,
SECTION
4
COMPUTATION OF TAX
A
AT RATE OF$ 1.50 PER THOUSAND(PLEASEROUNDDOWN TO THENEARESTTHOUSAND
ON HIGHESTTOTALPAID -IN CAPITALSTOCK AS
ON LINE 3F ABOVE
B.
TAXDUE(4A OR $150.00 (WHICHEVERISGREATER
SECTION
PENALTY AND INTERESTFOR LATE PAYMENT
A
PENALTY-
% OR $50.00 WHICHEVER IS GREATER) OF 4B
B .
INTEREST- 1% COMPOUNDEDANNUALLY FOREACHMONTH
OR PARTTHEREOF, BYWHICH PAYMENTIS DELAYEDBEYOND
THE JUNE
DEADLINE
C
TOTAL PENALTY AND INTEREST
SECTION
6
TOTAL DUE(TAXES , PENALTY , INTEREST)
SUM OF 4B AND 5C
00
UNDER PENALTY OF PERJURY, UNDER THE LAWS OF THE UNITED STATES VIRGIN
THAT ALL STATEMENTS
CONTAINED
THIS APPLICATION
AND ANY ACCOMPANYING
DOCUMENTS
ARE TRUE AXO CORRECT WITH
FUU KNOWLEDGE THAT ALL STATEMENTS MADE IN
THIS APPLICATION
ARE SUBJECT TO INVESTIGATION
AND THAT ANY FALSBOR DISHONEST ANSWER TO ANY QUESTION
MAY BE GROPNDS FOR DENIAL OR SUBSYQUENT REVOCATION
OF REGISTRATION .
PRESIDENT
/2018
2018
DATE
DATE
Kahn
PRINTEDFIRSTNAMEAND LASTNAME
SIGNATURE
Jeffrey E. Epstein
PRINTED FIRST NAME AND LASTNAME
REPORT OF STOCKHOLDERS
ON TAX EXEMPTED ENTITIES
(Due on or before June
of each year.)
Pursuant to Title 29 Chapter 12
Section 716 (a ) of the Virgin Islands Code, requiring the
filing stockholders , the following statement is filed with the Office of the Lieutenant Govemor
NAMEOF ENTITY Southern Country International, Ltd
TYPE OF ENTITY: (Pleaseselectone.)
Sole Proprictor Partnership
Domestic Limited Partnership
Foreign Limited Partnership
DomesticLimitedLiability Partnership
Foreign LimitedLiability Partnership
Domestic Corporation
Exempt Corporation
Foreign Corporation
Domestic LimitedLiability Company
Foreign Limited Liability Company
MAILINGADDRESS 6100 RedHook Quarter, B3, St. Thomas, USVI
OF
January
1, 2015
to December
NAMES AND ADDRESSES OF ALL PERSONS(ENTITIES) OWNING FIVÉ
MORE PERCENTOF THE STOCK OREQUITABLEOWNERSHIP:
LT..
OFFICE
FECEIVED
Name
Address
Percent
100
Residents
Jeffrey Epstein
6100 RedHook Quarter, B3,
St. Thomas USVI00802
Note:
This reportmust also includethe names and addressesofall legal or equitable owners of such benefited business
who have or will claim benefits under this
as bona fide residents of
Virgin
to Act
6748.
DATED
12
VERIFIED
Presidentor Vice President
Secretary or Asst.
Manager orManaging Partner
SOUTHERN
COUNTRY
INTERNATIONAL,
LTD.
1018
Government
of
the
Virgin
Islands
2
/
6
/
2019
Annual
fees
for
2019
renewal
75.
000.00
First
Bank
75,
000.
00
ST CROIX 116 King Street, Frederiksted,
(340 ) 773-6499 FAX (340) 773-7701
ST. THOMAS
Shopping Center, Suite 620 St. Thomas, VI
(340) 714- 1700 FAX(340) 777- 1103
UNITED
ISLANOS
EconomicDevelopment
Authority
USVIEDA.org
November 19, 2018
Via Electronic and CertifiedMail
Mrs. Cecile R. de Jongh
Manager
Southern TrustCompany, Inc.
6100RedHook Quarter, B3
St. Thomas, VI00802- 1348
Re: Southern Trust Company, Inc.
DearMrs. de Jongh:
The Virgin Islands Economic Development Commission (“ VIEDC " ) Division of Compliance completed
a compliance report of Southern
Trust Company , Inc. ( Southem
Trust ) for period February
, 2013
through December 31, 2017
For the compliance period covering February
, 2013 through December 31, 2017 the VIEDC has
determined that
Trust has complied with the Standard Conditions, Special Conditions and
Reporting Requirements of its tax incentive Certificate.
As of the completion date of this report, the
Division of Compliance has not received a response from
the Virgin
Islands Department of Labor
( VIDOL" )
Upon receipt of compliance clearance from the VIDOL, the Division of Compliance will
issue a compliance clearanceletter to Southern Trust for theabove mentioned compliance period.
You may provide a response to this compliance report within
30 days ofreceiptof this correspondence.
Ifwe do not receivea response from you by this date, we will conclude that you are in agreementwith the
compliance report findings.
Questions orconcerns regarding thismatter shall be directed to Claude S . M .
Gerard, DirectorofComplianceat 340-773-6499 ext. 2621or email csmgerard @ usvieda. org
Cordially
Claude S. M . Gerard
DirectorofCompliance
cc KamalI. Latham , ChiefExecutiveOfficer, USVIEDA
Wayne L. Biggs Jr., Assistant ChiefExecutiveOfficer, USVIEDA
Sandra Bess, Compliance Officer II, VIEDC
Joy Penn, Senior ComplianceOfficer, VIEDC
. CROIX 116 King Street, Frederiksted,
(340
-6499 FAX(340)773 7701
ST. THOMASB000
ShoppingCenter, Suite620, St.
,
340)
-1700 FAX (340)715-2753
WWW .
ORG
STATES VIRGIN ISLANDS
Economic Development Authority
CONFIDENTIAL
COMPLIANCEREPORT
SOUTHERN TRUSTCOMPANY, INC
As of December31, 2017
SUMMARYHIGHLIGHTS:
TrustCo., Inc. was granted a tax incentiveCertificate: commencementFebruary
1, 2013, termination January 31, 2023. This report covers the period: February 1, 2013to
December31, 2017.
Southern Trust Co., Inc. met the Certificate' s investment requirement of not less than
$400,000 after a requested extension was granted by the Board of Commissioners.
Capital Expenditures for the period: $549,853 of which 84 % ($459,853) was procured
locally.
and Services for the period: $ 7, 114 ,683 ofwhich
15 %
($ 1,091, 766 ) was procured
locally .
Trust Co.,
Inc. met the tax incentive Certificate' s full- time employment
requirementof five (5 )
full-time employees within one year the Chairman signs the
Certificate
Southern
Trust Co. , Inc met the tax incentive Certificate ' s employee statutory residency
requirement as at least 80 %
of all employees and 20 % of management, technical and
supervisory positions are residents ofthe US Virgin Islands.
Southern Trust Co. , Inc met the Certificate ' s requirements of special condition numbers ;
one (charitable contributions), two ( $ 2 ,500 annually
to the Department of Labor), three
($ 2,500 annually to the Territorial Scholarship Fund), four ( 100 %
employer paid medical
and dental insurance
coverage)
five
(minimum
$50,000
employer
paid
term
life
insurance), six ( Simple IRA or similar retirement plan ), seven (paid vacation , personal
emergency days , bereavement andmedical leave ), eight (management training program ),
nine (tuition reimbursement, employee training and continuing professional education ),
ten
(leave to participate and represent the US Virgin
Islands in athletic and sporting
events), eleven
( employee donated leave
program ), twelve (purchase
insurance
from
resident insurance companies ), thirteen
( purchase goods and services from
US Virgin
Islands as available to the greatest extentpossible).
Trust Co., Inc. complied with the statutory requirements of the Virgin Islands
Economic Development Commission' sprocurement process.
Trust Co., Inc. met the Virgin IslandsEconomicDevelopmentCommission' s
reporting requirements .
COMPLIANCEREPORT
SOUTHERN TRUST COMPANY, INC.
As ofDecember 31, 2017
Title 29, Chapter12 VIC , Section 715(a) states in part " upon proper application or reapplication,
public hearingand in compliancewith all other relevantprovisionsofthis chapterpertainingto
the grant of initial benefits, as determined and required by the Commission, any recipientof
industrial developmentbenefits (sic),
be granted an extension,modification, or renewalof
benefits. ..
A ComplianceReport is performed to substantiatethe Beneficiary' s performancewith the terms
of its contractwith
the Governmentof the Virgin Islandsof the United States. The review
includes compliance with the Virgin
Islands Economic Development Program
Law, all
applicablelocaland federallaws, andprogram regulationsto includethereportingrequirements.
HISTORY:
On November
18, 2011, Financial Informatics Inc. filed
Articles of Incorporation with the
Office of the Lieutenant Governor. On December
8, 2011 they were issued a Certificate of
Incorporation authorizing them
to conduct business in the Virgin Islands. On September
20 ,
2012 , Article
of Financial Informatics, Inc.' s articles of incorporation was amended to reflect a
change of name too Southern Trust Company, Inc
Southern
Trust
Company, Inc. specializes in the interpretation of biomedical and financial
artificial intelligence and offers market intelligence to companies which operate in the financial,
biomedical and pharmaceutical industries. Southern
Trust Company Inc.' s primary goal is to
become a successful competitor in the field of artificial intelligence concentrated in biomedical
informatics and financial informatics algorithms and technology . They focus on data acquisitions
and locating and establishing wide-ranging, all-inclusive biomedical and financial information
databases on servers located in theUS Virgin Islands.
Southern Trust Co., Inc. was granted tax incentives to conduct the operation of a Category IIA
designated financial services business, providing extensive DNA database and to develop a data
mining platform
for the database to be available through the internet. Services include the
development of financial and biomedical informatics. Information will bekept on servers located
in theUS Virgin Islands. All clients will be located outside the U . S . Virgin Islands.
The grant of tax incentives is for a period of ten ( 10) years
commencing and terminating as
follows:
COMMENCEMENT
TERMINATION
IncomeTaxes
90 %
February 1 2013
January 31, 2023
Gross Receipt Taxes
100 %
February
1, 2013
January 31, 2023
Excise Taxes(Raw Materials)
100 %
A
N / A
Excise Taxes (Equip.,Mach.)
100 %
February 1, 2013
January 31, 2023
Dividend Withholdings
February 1, 2013
January 31, 2023
Interest Withholdings
February 1, 2013
January 31, 2023
Real Property Tax
100 %
N / A
N
A
Custom
Duties
NA
NA
CONFIDENTIAL
2
COMPLIANCE REPORT
SOUTHERN
TRUST COMPANY, INC.
As of December 31, 2017
Southern
Trust Company Inc. submitted an application for tax incentives which was presented at
the Virgin Islands Economic Development Commission 's Public Hearing on November 15, 2012
and Commission meeting on January 23, 2013.
The Governor of the US Virgin Islands approved
the grant of benefits for Southern
Trust , Inc. on May 31, 2013
An orientation meeting was
conducted on February 19, 2014 with the Virgin Islands Economic Development Commission 's
("VIEDC
Director of Compliance
and
Compliance
Officer along with legal counsel and
principals of Southern Trust Company , Inc.
AsofDecember31, 2017, Southern Trust Co., Inc. (" the Beneficiary ) received four years, ten
monthsof tax incentivebenefits.
Southern
Trust Company, Inc. is solely owned by Mr. Jeffery E. Epstein. Mr. Epstein also
owned
former
VIEDC
Beneficiary
Financial
Trust
Company
Inc. whose
tax
incentive
Certificate commenced on April 1, 2009 with
a termination date of December 31, 2014. By letter
dated April 4 , 2012, Financial Trust Company , Inc. requested and was granted a termination of
its tax incentive Certificate effective March 23, 2013.
INVESTMENT:
The Beneficiary shall invest in this businessin the Virgin Islandsof the United States not
less than the amountof four hundred thousand dollars ($ 400,000) in thebenefited business
upon commencementofbenefits and completing one (1) year thereafter."
By letter dated November 12, 2013, the Beneficiary' s legal counsel requested a one year
extension until February 1, 2015, to meet the capitalinvestmentrequirement.
The VIEDC informed the Beneficiary by letter dated February 20, 2014 that at the January 24,
2014 decisionmeeting, the Board approved Southern Trust Company' s petition and granted an
extension of time for Southern TrustCompany, Inc. to meetits capitalinvestmentby February 1,
2015
FINDINGS
The tax incentive Certificate required Southern Trust Co., Inc. to invest not less than $ 400,000
commencing February 1, 2013
and
completed one year thereafter - January
31, 2014 . The
Beneficiary ' s petition request to the VIEDC Board of Commissioners
granted an extension to
February 1, 2015 .
Asof 2015, the Beneficiaryinvested a totalof$539, 722,meeting the Beneficiary' s tax incentive
Certificate's investmentrequirementas requiredby the extension granted by the VIEDC Board
Forthe period coveredbythis report Southern Trust invested a cumulative total of $628,472, a
totalof$ 228,472 over the tax incentive Certificate' s investmentrequirement
CONFIDENTIAL
3
COMPLIANCEREPORT
SOUTHERNTRUSTCOMPANY, INC.
AsofDecember31, 2017
CAPITAL EXPENDITURES :
VI
YEAR
TOTAL
ELIGIBLE VI
SUPPLIER
227,637
155 132
NON-VI
SUPPLIER
60, 000
30 .000
$
SUPPLIER
,055
2, 300
56 598
10,131
72,325
2013
2014
2015
2016
2017
CUMULATIVE
TOTALS
8 055
289,937
241.730
10 131
78 619
6
769
, 409
96,294
,472
FINDINGS:
SOUTHERNTRUSTMANAGEMENT
, INC.
CAPITAL EXPENDITURE
2013- 2017
15%
VISupplier
VI Supplier
* Non -
For the period 2013 to 2017, the Beneficiary reported procuring a total of $628,472 in capital
expenditures . Of the total expenditures reported; 61%
($ 382,769) were purchases from
Eligible
Virgin
Islands Suppliers
for machinery and equipment and
vehicles ,
24 %
($ 149, 409) were
purchases
from
VI Suppliers machinery /equipment and leasehold
&
improvements and
15 %
($ 77,
) from
non-VI Suppliers for computer software .
CONFIDENTIAL
COMPLIANCE REPORT
SOUTHERN TRUST COMPANY, INC.
As of December 31, 2017
GOODS AND SERVICES :
YEAR
NON-
SUPPLIER
TOTAL
SUPPLIER
$
$
2013
2014
2015
2016
2017
CUMULATIVE
TOTAL
ELIGIBLE
SUPPLIER
$
10 089
38 ,978
76 ,611
82,529
93,940
202,394
281.278
201.902
197 985
154,620
771, 461
$
1.895 365
2 ,058,586
1 297 505
1428, 992
983, 944
2 ,215 621
2 337,099
1578,019
1677 ,552
$
302 147
1,038, 179
7,
, 909
8 ,792, 235
FINDINGS
For the period February 1, 2013 to December 31, 2017, the Beneficiary reported procuring a total
of $ 8,792, 235
for
goods and services. Purchases
from
non- Virgin
Island suppliers totaled
$ 7 ,451,909 (85 % ) of which the majority was spenton legal/accounting, advertising, supplies and
insurance.
Procurement from
Virgin
Island Suppliers was $ 1,038,179 (12 % ), of which
the
majority was spent on rent, utilities, legal/accounting and supplies. Purchases
from
Eligible
suppliers
totaled
$ 302,147 ( 3 % ) of which the majority was spent on advertising, insurance,
utilities, repairs andmaintenance.
SOUTHERN
TRUST MANAGEMENT, INC.
GOODS AND SERVICES
2013 - 2017
Supplier
LOCAL PROCUREMENT:
In accordance with Division
7 of the Virgin Islands Economic Development Commission Rules
and Regulations , the Beneficiary must comply with procurement procedures (Section 708 -701to
708 -713).
CONFIDENTIAL
5
COMPLIANCEREPORT
SOUTHERN TRUST COMPANY, INC.
AsofDecember31, 2017
SOUTHERNTRUST MANANGEMENT
TOTAL PROCUREMENIT
2013
2017
100
90 %
80 %
70
60%
50 %
40
30 %
20 %
10
0
Exp
90.
149
Goods
Sves
7 451
1 038. 179
local
Suppliers
322,
FINDINGS:
For the period February 1, 2013 to December 31, 2017, the Beneficiary expended a total of
$ 9,420,707 for capital expenditure and goods and services.
A total of $ 7,548,203 (80 % ) was
expended to non-LocalSuppliers, ofthese purchases themajority was spenton legal/ accounting,
advertising and computer
software.
Purchases made from
Virgin
Island Suppliers totaled
$ 1, 187, 588 (13% ) ofwhich themajority was spent on utilities, rent andmachinery/equipment. A
totalof$684, 916 (7 % ) was expended with eligible suppliers, of these purchases themajority was
spenton machinery/equipment, vehiclesand legal/accounting.
In accordance with the VIEDC Rules and Regulations, Section 708-709 the Beneficiary was
required to provide proof of soliciting goods and services on a competitive basis for a single
purchase exceeding $ 25,000, unless the good or service is deemed an exempt procurement
as stated in section 708-706 .
For the period covered by this report, the Beneficiary's purchases for ISP equipment,
computer software, a vehicle, and machinery/equipment exceeded $ 25,000.
The purchase for ISP equipment, a vehicle and machinery/equipment weremade with
Eligible VI Suppliers, and therefore deemed exempt. The computer software was also
exempt as the specialized software required by the Beneficiary is not available in the
United States Virgin Islands.
EMPLOYMENT:
“ The Beneficiary will employ a minimum of five (5) full-timeemployeeswithin one year
from
the date the Chairman signs its Certificate, and an additional five (5
full-time
employeesby the end of the sixth
year of operation. The Beneficiarywas granted a
50 %
residentemploymentwaiver for the first five (5) years of operation and to require the
CONFIDENTIAL
COMPLIANCEREPORT
SOUTHERN TRUSTCOMPANY, INC.
As ofDecember 31, 2017
following:
The Beneficiary will contribute two thousand five hundred dollars ($ 2 ,500)
annually to the Territorial Scholarship Fund, administered by the Board ofEducation, for
each non -resident that causes it notto meet the 80 %
requirement
Southern Trustwill also
exhaust all recruitment options available but not limited to the University of the Virgin
Islands and then Department of Labor.
VIEDC Rules and Regulations Section 708 -605 define full-time employees or employment as
"employment, on a permanent and continuous basis, for thirty -two ( 32) hours ormore per week ”
FINDINGS:
The Chairman of the VIEDC Board signed the tax incentive Certificate on February 5, 2014.
YEAR
TOTAL
20 %
V .I
8
2013
2014
2015
2016
2017
AVERAGE
AVERAGE
AVERAGE
AVERAGE
ERAGE
FULL TIME
V.I.RES.
V.I.Res.
MGMT.
100 %
8
91%
3
100 %
8
100 %
94%
8
100
100 %
100 %
100 %
%
8
For the period 2013 to 2017 , the Beneficiary
employed
an average of seven (7) to nine (9 full
time employees. They met the tax incentive
Certificate ' s requirement of five (5) full-time
employees within one year from thedate the Chairman signed the certificate . Although
granted
a
50 % resident employment waiver for the first five (5) years of operation , the Beneficiary met the
statutory requirement of 80 %
of all employees being residents of the Virgin Islands,with no less
than 20 % in the area ofmanagement, supervisory and/or technical positions.
STANDARD CONDITION:
Beneficiary shall maintain payroll accounts, from which local employees are paid
in
a
bank licensed and conducting business in the United States Virgin Islands, in compliance
with 1992
V . I. Sess. Laws 5768.
The Beneficiary confirmed that a payroll account from which employees are paid
ismaintained at FirstBank VI. First Bank is licensed and conducting business in
the US Virgin Islands.
SPECIAL CONDITIONS :
1.
Beneficiary willmake a minimum charitable contribution of fifty thousand dollars
($ 50 ,000 ) annually.
The Beneficiary will donate three thousand dollars ($ 3,000)
annually to the Territorial Scholarship Fund pursuant to 2006
V . I . Sess. Laws 6842.
CONFIDENTIAL
7
COMPLIANCEREPORT
SOUTHERN TRUST COMPANY, INC.
As ofDecember 31, 2017
Additionally , the Beneficiary will donate 50 %
of its annual charitable contribution
to public school program and initiatives pursuant to 29
V . I . C .
m ).
REQUIRED BY
TAX INCENTIVE CERTIFICATE
2013
2014
2015
2016
2017
PUBLIC SCHOOL PROGRAMS
AND INITIATIVES
$ 25, 000
$
,000
55 696
34, 620
000
$
,000
CHARITABLE
CONTRIBUTION
$ 22,000
40,924
16 ,880
28.250
26 ,200
TERRITORIAL
SCHOLARSHIP FUND
31,310
6 ,000
3 . 000
3,000
3 ,000
3,000
ANNUAL BENEFICIARY CONTRIBUTIONS
MINIMUM REQUIREMENT -
50, 000
$
,924
|
$
,924
93,006
$
006
54,
4,500
56,250
$
6,250
$ 54, 200
$
4,
VARIANCE(OVER
)
The tax
incentive
Certificate required
Southern
Trust Company,
Inc
to make annual
contributions of $ 50,000
total contributions of $ 250, 000 for the period January 1, 2013
to December 31, 2017.
Beneficiary
provided documentation
to
substantiate contributions made in
2013 totaling
$ 96 ,624 . Of the total
$ 56 ,000 was given
to
VI Department of
Education, and $ 40, 924 to charitable contributions which include the University
of
the
Virgin
Islands
Community
Foundation of the
Virgin
Islands, Zero
Tolerance Basketball Org. Inc. , and the St. Thomas Reformed Church.
The Beneficiary
provided documentation
to
substantiate contributions made
in
2014
totaling
$ 93, 006 . Of the total:
$ 35,696
was directed
to
public
school
program
and initiatives
for the STEM
Fair, and
$ 10, 000
Science and Math
scholarships to one student of the Charlotte Amalie
and one from
the Ivanna
Eudora Kean High
School.
Contributions
to
charitable
organizations
in
the
amount $ 31, 310 were given
to organizations such as
Humane Society of St.
Thomas, Antilles School, Community Foundation of the VI. The Beneficiary also
made a contribution of $ 6 , 000 to the Territorial Scholarship Fund, which
included
a contribution of $ 3, 000 not made in 2013
The Beneficiary provided documentation
to substantiate
contributions made in
2015
totaling
$ 54 ,500 . Of the total
$ 34,620 was directed
to public
school
program
and initiatives
for the
Ivanna Eudora Kean High School' s Dancing
Classroom
and Junior Achievement US Virgin
Islands, and Computers for public
schools through the Board of Education. Contributions to charitable organizations
in
the
amount $ 16, 880 were
given
to
organizations
such
as My Brothers
Workshop , Humane
Society
St.
Thomas, Antilles
School, and
Community
Foundation ofthe VI. The Beneficiary also made a contribution of $ 3, 000 to the
Territorial Scholarship Fund.
and 2014
Scholarship Fund contribution
CONFIDENTIAL
8
COMPLIANCEREPORT
SOUTHERN TRUST COMPANY, INC.
AsofDecember31, 2017
The Beneficiary
provided documentation
to
substantiate
contributions totaling
$ 56 ,250 made in 2016 . Contributions to public school programs and initiatives in
the amount $ 25 , 000 was given to the Community Foundation of the VI and the VI
Chapter
of
the
Organization
of
Black
Aerospace
Professionals.
Charitable
Organizations such as Lutheran Social Services, Antilles School, Inc, Community
Foundation of the VI and the Harmonic Lodge were given a total of $28,250. The
Beneficiary
also made
a
contribution
of $ 3 ,000 to
the Territorial
Scholarship
Fund.
The Beneficiary
provided documentation
to substantiate
contributions totaling
$51, 200 made in 2017. Contributions
to
the public school and initiatives
in the
amount $ 25 ,000 was given
to the Department of Planning & naturalResources
library
Revolving
Fund .
Charitable
organizations
such
as
Lutheran
Social
Services of the
V . ., St. Thomas Rescue, Inc., Community Foundation and Wesley
Methodist Church were given
a total of $ 26 ,200
The Beneficiary
also made a
contribution of $ 3 ,000 to the Territorial Scholarship Fund.
The tax
incentive Certificate
required
the Beneficiary to make a minimum
of
$250,000
in charitable contributions. For the period covered by
this report
the
Beneficiary
contributed
$ 354,880 ;
a
total
of
$ 104,880
over
the tax
incentive
Certificate' s requirement
The Beneficiary met the requirements ofthis special condition .
2 .
Beneficiary will contribute
two thousand
five hundred
( $ 2,500) annually
to
the
Departmentof Labor, to bemanaged in collaboration with the USVIEDA, for the
creation, development, management, and maintenance
a database designed to
recruit Virgin Islanders living abroad who desire to move back to the US Virgin
Islands, pursuantto 2011VISess Laws7301, as applicable.
TheBeneficiaryprovided documentationto substantiatecontributionsmadein
2014 totaling $ 5 ,000 to the VIDepartmentof Labor forthe years 2013 and 2014.
The Beneficiary provided documentation to substantiate a contribution of $ 2 , 500
to the Departmentof Labor for the year 2015
The Beneficiary provided documentation to substantiate a contribution of $ 2,500
to the Department ofLabor for the year 2016 .
The Beneficiary provided documentation to substantiate a contribution of $ 2 ,500
to the Departmentof Labor for the year 2017.
The Beneficiary met therequirements ofthis special condition
CONFIDENTIAL
9 Page
COMPLIANCE REPORT
SOUTHERN
TRUST COMPANY, INC.
As of December 31, 2017
3.
The Beneficiary will contribute two thousand fivehundred dollars ($ 2,500) annually
to the Territorial Scholarship Fund administered by the Board of Education for
each non-resident that causes itnot to meet the 80 %
requirement. Southern Trust
will also exhaust all recruitment options available butnot limited to the University
of the Virgin Islands and the Department ofLabor.
Forthe period 2013 to December 2017, and as shown in the employmentchart,
the Beneficiary' s employee recruitment did not fall below
the
tax
incentive
Certificate' s residency requirementof 80%
and therefore was not required to
make annualcontributionsin the amountof$2,500 to the TerritorialScholarship
Fund
The Beneficiarymet the requirements of this special condition .
4.
The Beneficiary will provide its full-time employees and dependent with one
hundred percent (100 % ) employer paidmedicaland dental insurancecoverage.
The employeehandbook provided by the Beneficiary states thatall full-timeemployees
become eligible to participate in Southern Trust Company' s group health plan on the first
day of themonth following one day of employment and satisfaction of any eligibility or
other requirements of the group health insurance policy in effect at the time.
The
Beneficiary provides its full-time employees and their dependents with 100 % employer
paidmedicaland dentalinsurance coverage.
The Beneficiary provided
a
copy of health
and dental insurance coverage
providedby United HealthCare
seven employees.
TheBeneficiarymetthe requirements ofthis special condition.
5.
The Beneficiary will provide each eligible full-timeemployee with a minimum of
fifty thousand dollars ($50,000)employer paid term
life insurance.
The employee handbook provided by the Beneficiary
states that Southern
Trust Company
provides
life
and
accidental
death
and
dismemberment
insurance
to
all
full -time
employees in the amount of $50,000 of employer-paid term life insurance after one day
ofemployment.
The Beneficiary provided a copy of United HealthCare s life insurance coverage
in the amount of $ 50,000 provided to seven employees from
2013 and 2014.
For the years 2015 to 2017 employees were provided employer paid term
life
insurance coverage in the amount of $ 100,000.
The Beneficiary mettherequirements of this special condition.
CONFIDENTIAL
10
COMPLIANCE REPORT
SOUTHERN TRUST COMPANY, INC
AsofDecember31, 2017
6. The Beneficiary willprovide its employeeswith a Simple IRA or similar retirement
plan .
The
employee participant may
make monthly
salary
deferrals.
The
Beneficiary will make a matching contribution equal to 100 %
of the employee' s
elective deferralup to a limit of 3 % of annualcompensation .
The Beneficiary employee handbook provided to substantiate the SIMPLE IRA
retirementplan states that Southern Trust Company has an established Simple IRA
RetirementPlan in which eligibleemployeecan participateafter oneday ofemployment.
Employee participantsmay makemonthly salary deferrals. Southern Trust Company
makes amatchingcontribution equalto 100 % ofthe employee' s electivedeferralup to a
limitof 3 % annualcontribution.
The Beneficiary also provided the copy of an American Funds Simple IRA Adoption
Agreement serviced by
of Seslia
Securities, St.
Thomas, Virgin
Islands. The plan originally created July 1, 2001was amended and restated on April 1,
2013.
The plan 's employer contributions states, a matching contribution equal to 100 %
of elective deferrals up to
a limit of 3 % of compensation for the calendar year
The plan
also allowed for Rightsof Accumulation from
Financial Trust Company
For the period 2013 to 2016 , the Beneficiary provided documentation showing
annual employee contributions
for
full-time employees
except Mr.
Jeffrey
Epstein
For the year 2017, the Beneficiary provided documentation showing annual
employee contributions for full-time employees except Mr.
Jeffrey Epstein,
and
TheBeneficiary met therequirements ofthis special condition.
7. The Beneficiary will provide its employees with
a minimum of two ( ) weeks paid
vacation during the first year of employment, three (3) weeks paid vacation up to
five years (5) years of employmentand four (4) weeks paid vacation after five (5)
yearsof employment. The Beneficiarywill also provide its employees with two ( )
paid personal days and fifteen
(15) paid holidays annually. The Beneficiarywill
provideup to five (5) personalemergency days and five (5) days bereavementleave.
Undermedicalleave policy, full- timeemployeesmay have the financialprotection of
full pay for up to 26 weeks. TheBeneficiarywill offer fully paid and unpaid medical
leave dependentupon a number of factors.
The Beneficiary provided the copy of an employeehandbook which states; paid timeoff
isany timetaken from work thatis notmandatory; jury duty, bereavementleave,
or any paid company holiday
can be taken in weeks, days or half days, depending
on businessrequirements.
A manager's approval isrequiredbefore PTO can betaken.
Every full-time employee regularly scheduled to work thirty-two or morehoursper week
is eligible for PTO each calendar year. Each full-time employee will accrue PTO every
payperiod in hourly incrementswith the totalprorated over a 12-month period. Accrued
CONFIDENTIAL
11
COMPLIANCE REPORT
SOUTHERN
TRUST COMPANY, INC.
As ofDecember31, 2017
hourswillbeadded to the employee' s PTO account and subtractedwhen used. PTO is
accrued based on a 40-hourwork week and proratedbased on the numberofhours
worked. Duringthe first calendar year
hiredbeforeJuly 1, an employeeis eligible for
two weeksofvacation. Ifhired on or after July 1, an employee is eligible for three weeks
per year. After five yearsof service, employeesare eligible for fourweeks of vacation
PTO mustbeused in the calendaryear itis accrued and generally notpermitted to
carryover
Southern Trust Company providespersonaldayswhich can beused for religious
observancesorotherpersonalmatters. All full-time employeesare eligible for twopaid
personaldays each calendaryear. Personaldays can betaken atany timeduringthe
calendaryearprovidedthatthetimeis scheduled in advancewith theemployee' s
manager. Unusedpersonaldays cannotbe carried into thenext calendaryearnorpaid
when an employee leavesSouthern Trust Company, Inc.
Holidaysobserved by Southern Trust Company, Inc.:
New Year' s Day
Martin Luther KingDay
Good Friday
EasterMonday
MemorialDay
VIEmancipationDay
LaborDay
Veteran ' s Day
Friday after Thanksgiving
Christmas Day
BoxingDay
Presidents ' Day
Carnival Parade
Independence Day
Thanksgiving Day
Christmas Eve Day
New
Year ' s Eve
Full-time employees arepaid for a full eighthourworkday on such holidays. Holidays
fallingon a Saturday or Sunday are observed the preceding Friday or followingMonday
as directed bymanagement
The employeehandbook states Southern Trust Companyprovides full-timeemployees
with fivedaysofbereavementleaveon a rolling 12-month period, after completing three
monthsof service, when amember of an employee's immediatedies. An
immediate
familymemberincludesan employee' s spouse, or domestic partner, child, or a child for
whom an employee servesin therole of a parent, parentor someonewho served in the
roleofa parentwhen the ernployeewas a child, parent-in- law , brotherorsister, and a
relative who is amember of the employee' shousehold.
Tohelp copewith a sudden personalor family emergency, resolveproblemswith
childcare, or respond to a household emergency, the Beneficiaryprovides full-time
employeeswith up to five days ofpersonaldaysin a 12-month period. Full-time
employeesareeligible to requestpersonalemergencydaysaftercompletingthreemonths
ofservice.
At site visit conducted on
September
28
2018,
the Beneficiary provided
documentation to substantiate therecordingof employee's paid timeoff.
The
Beneficiary ' s
compliance
contact
stated
that in
2013, the
employees
transferred from
former VIEDC Beneficiary Financial Trust Company, Inc. were
allowed to carry over their excess vacation time to be used by March 31, 2013.
CONFIDENTIAL
12
COMPLIANCEREPORT
SOUTHERN TRUST COMPANY, INC.
Asof December 31, 2017
The transferred employees' annual leave allotment was then reset based on years
of service
TheBeneficiarymetthe requirements ofthis special condition.
8
The Beneficiarywill comply with themanagementtraining program asapprovedby
the Commission in Resolution no. 006 - 2011 approved February 25 , 2011
Atthe time of application the Beneficiary stated; recruitmentto managementtrainee roles
is open to all qualified members. A process will be followed to identify and appointthose
individuals who display the attributes and competencies required to
achieve their
expected potential through the acquisition of a
core set of transferable skills and
professionalcompetencies.
Approval for management trainee positions will be through
a process conducted by the
President and Chief Executive Officer ( CEO
).
The President and CEO will construct a
business case"
and have final approval prior to proceeding with recruitment. This will
allow
for
a consistent approach
towards
future development
and training as well as
ensure compliance with employment laws.
The Beneficiary ' s employee handbook lacked information about a management program
available to employees.
The Beneficiary's complianceresponse letter dated September4 , 2018 stated that
participated in the Company ' s management training program .
For theperiod covered by this report; quarter ending March 2013 to December31,
2013 -
position was listed as Personal Administrative
Assistant Accountant . As of quarter ending March 2014
to
December 2017,
position was listed as Executive Assistant.
The Beneficiarymettherequirementsof this specialcondition.
9.
The Beneficiary will provide its
employees tuition
reimbursement,
employee
training and continuingprofessional education courses for programsrelated to an
employee' s job function and approvedbymanagement. The maximum assistance to
be provided to an eligible employee during a calendar year is five thousand ($ 5, 000)
on the grade achieved with 100 %
for an " A " ; 75 %
for a “ B ” ; and 50 %
for a
C
The employee handbook providedbythe Beneficiarystates; they value education and a
strong, knowledgeableworkforce and as such
provide tuition assistance to
qualified
employees and dependentswith a maximum of five thousand two hundred dollars per
calendaryear. To be eligible an employeemustbein a regular, full-time, non-temporary
position and completed the school' s admission requirements. Employeesmust provide
CONFIDENTIAL
13
COMPLIANCEREPORT
SOUTHERN TRUST COMPANY, INC.
AsofDecember31, 2017
proofof a passing grade (C or better) at the end of the course. If
passing grade is not
obtained, tuition assistance for thenextsemester immediately followingmay bewithheld.
The Beneficiary ' s compliance response letter to the VIEDC dated September 4 ,
2018 stated the following
employees
provided tuition reimbursement,
employee training, or professional training:
The Beneficiary met the requirement ofthis special condition.
10. The Beneficiary will provide its employees with additional leave from work, other
than time applied
to their annual leave, to participate and represent the Virgin
Islands in athletic and sporting events in accordance with 29 V .I. C .
(p ).
The Beneficiary ' s compliance response letter dated September
4 , 2018 stated that
for the period covered by this report no employee of Southern
Trust Company,
Inc requested leave to participate and represent the US Virgin Islands in sporting
events .
The Beneficiary ' s employee handbook did not state they provide employees with
additional leave from work, other than time applied
to annualleave to participate and
represent the Virgin
Islands in athletic and sporting events in accordance with 29
V .I. C .
708 (p ). The employee handbook states however paid timeoff
is any
time taken
from
work
that is notmandatory ; jury duty, bereavement leave, or any
paid company holiday. PTO can be taken in weeks, days or half days, depending on
business requirements . A manager 's approval is required before PTO can betaken .
The Beneficiarymettherequirementof this special condition .
11. The Beneficiary will establish and maintain a donated leave program similar to the
program established under 3 V.I.C .
, in accordance with 29 V.I.C.
(s).
The Beneficiary provided
a copy of the employee handbook which states; in addition to
the fully paid medical and unpaidmedical leave, any full-timeemployee shall be eligible
to receive donated
sick or annual leave from
the employee leave pool
” which
Southern Trust Company shallmake available to an employee;
has completed atleast one year of continuousemployment;
CONFIDENTIAL
14
COMPLIANCEREPORT
SOUTHERN TRUST COMPANY, INC.
As of December 31, 2017
o
is suffering from
a serious health condition or the employee is the primary
care giverofa spouse, child, parentor any individualwho is a legaldependent
of the employee
a serioushealth condition , who is expected to require a
prolonged absence from work by the employer and
o
has exhausted all sick , annual paid timeoff and fully paid medicalleavewhile
absent on approved sick leave.
At site
visit conducted
on September
28, 2018,
the Beneficiary
provided
documentation to substantiate an
established and maintained employee donated
leave program
The Beneficiary metthe requirements ofthis special condition .
12. The Beneficiary will require all contractors to purchase insurance from resident
insurance companies, agents, or brokers licensed to operate in the territory in
accordance with 29
V . . C .
(r) .
The Beneficiary
provided
documentation
showing health
and life insurance
purchased from Marshal & Sterling Inc, d /b / a Theodore Tunick and Company, an
Eligible Supplier licensed broker,
in
good standing under the laws of the US
Virgin
Islands
TheBeneficiarymetthe requirements ofthis special condition.
13. In accordance with and subject to 29
V .I.C .
h) and applicable Commission
Rules and Regulation with regard to the EligibleSupplier Program, theBeneficiary
will purchase all goods and services from US Virgin Islands entities duly licensed
and
in good standing under the laws of the Virgin
Islands, as available, to the
greatest extent possible.
For the period February 1, 2013 to December 31, 2016 , the Beneficiary reported
total procurement of $ 7,664,536 .
A totalof $ 960,643 (12 % ) from
Virgin Islands
Suppliers
and
$ 590,976
(8 % )
from
VI Eligible suppliers .
The
remaining
procurement
included
the purchase of specialized
computer programs and
equipment.
The Beneficiary metthe requirements ofthis special condition .
SPECIFICALLYEXCLUDED TRADE OF BUSINESS:
U . S. Virgin Islands clients are specifically excluded from tax benefits.
CONFIDENTIAL
15
COMPLIANCE REPORT
SOUTHERN TRUST COMPANY, INC .
AsofDecember31, 2017
The Beneficiary confirmed that for the period of covered by this report
gross
receipt exemptions were taken exclusively
from
clients outside the US Virgin
Islands
REPORTING REQUIREMENTS:
Current
VIEDC AnnualReport:
IncomeTax Return
Audited FinancialStatements
Current
Lt.Governor's AnnualReport:
Current
VIESA Report:
Current
Affidavit ofVIEDC Beneficiary:
Current
VIEDC PublicationNotices
Current
FINDING:
Southern Trust Co., Inc met the reporting requirements in accordance with the VIEDC Rules
andRegulations, section 716 -6.
FINANCIAL ANALYSIS REVIEW :
YEARS
ANNUAL
NET
AGGREGATE
CHANGE
2013
2014
2015
2016
34.45 %
(21.82 % )
(91.00 % )
259.03 %
100.00 %
2017
AVERAGE
ORDINARY
INCOME
Southern Trust Company, Inc. cost benefit analysis reflects a ratio of 1:11. The Virgin Islands
Economic Development Commission granted tax exemptions to Southern Trust Company, Inc.
totaling about
for the period January 1, 2013 to December 31, 2017 . For every
$100,000 in tax revenues forgone, the territory of the United States Virgin
Islandsreceived
approximately $ 22,200 in economic output and $ 10,500 was added to the Gross Total Product
(GTP).
CONFIDENTIAL
16
COMPLIANCEREPORT
SOUTHERN TRUST COMPANY, INC.
As of December 31, 2017
Southern
Trust Company, Inc. elected to file its income tax as an
S - corporation, which elects to
pass corporate income, losses, deductions and credits through
to
its sole shareholder for tax
purposes. Shareholders of S -corporations report the flow -through of income and losses on their
personal tax returns and are assessed at the individual income tax rate. For the period 2013 to
2017 Mr. Epstein ' s income tax exemption approximated
STOCKHOLDERSINTEREST:
From
the submission of its VIEDC application to the completion of this compliancereport,
Southern TrustCompany, Inc. is solely ownedbyMr. Jeffrey E. Epstein
OTHER FINDINGS:
Southern
Trust Company, Inc.
is a tenant at the American
Yacht Harbor, located in Red Hook ,
St. Thomas, US Virgin Islands.
Mr. Jeffrey
E . Epstein is a passive investor in IGY-AYH St.
Thomas, LLL d/b/ a American Yacht Harbor.
By letter dated September 5, 2018, The DivisionofBanking, Insuranceand FinancialRegulation
stated that Southern Trust Company, Inc. is notregisteredto transactsecuritiesbusinessin the
U . S. Virgin Islands.
CONCLUSION:
Southern Trust Company, Inc, VIEDC Beneficiary;
1.
Granted ten years of tax incentives which commenced on February
, 2013 and will
terminateon January 31, 2023. Received four years oftax incentives, asofDecember31,
2017
2 . Metthe tax incentiveCertificate's investmentrequirementof$ 400, 000.
3 . Met the tax
incentive Certificate' s full-time employmentrequirementof five full-time
employees . Met the statutory requirements as at least 80 %
of all employees
are residents
of the US Virgin
Islands and 20 % ofmanagement , technical and supervisory positions
are held by residents of the US Virgin Islands.
4.
Complied with thetax incentive Certificate
s standard conditions.
5 .
Complied with the procurement requirements in accordance with the VIEDC Rules and
Regulations 708 - 701through
708 -713.
6 . Met the tax incentive Certificate's requirements of special condition numbers one
(charitable contributions), two ($2,500 annually to the Departmentof Labor) three
CONFIDENTIAL
17
COMPLIANCE REPORT
SOUTHERN TRUST COMPANY, INC.
As
December31, 2017
($ 2, 500 annually to
the TerritorialScholarship fund for non- compliance with the 80 %
residency requirement), four
(
employer paid dental insurance and dependent
coverage), five (minimum $50,000 mployer paid term life insurance), six (Simple IRA
or similar
retirement), seven (paid vacation,
2 paid personal days and fifteen paid
holidays annually), eight (management training), nine (tuition reimbursement),
ten
(leave to participate and representthe US Virgin Islandsin athletic and sporting events),
eleven (donated leave program ) twelve (purchase insurance from
resident insurance
companies), thirteen (purchase goods
services from US Virgin Islandsas available
the greatest extentpossible).
7.
Complied with
the VIEDC' s reporting requirements
(VIEDC Rules and Regulations
section 716 - 6) .
November15, 2018
Completed by:
Sandra Bess
Compliange Officer II
Reviewedby: _
Claude S . M . Gerard
Director ofCompliance
Submittedby:
, Jr .
AssistantChiefExecutiveOfficer
CONFIDENTIAL
18
GOVERNMENT
OF
THE
VIRGIN
ISLANDS
OF
THE
UNITED STATES
ECONOMIC
DEVELOPMENT
COMMISSION
PUBLIC
HEARING
THURSDAY,
November 15,
2012
12 : 43
p . m
. to
2 : 32
p . m .
Port Authority Conference Room
St .
Thomas,
Virgin
Islands
MEMBERS PRESENT
ALBERT BRYAN
Chairman
NATHAN SIMMONDS,
Vice Chairman
LYNN MILLIN MADURO,
ESQ . ,
Member
RANDOLPH ALLEN,
Member
JOSE
PENN,
Member
STAFF PRESENT
PERCIVAL
CLOUDEN ,
CEO
JENNIFER
NUGENT- HILL ,
ACEO
HENRY
SMOCK
ESQ. ,
Legal Counsel
FRED HANDLEMAN ,
ESQ . ,
Director
of Legislative
&
Legal Affairs
MARGARITA
BENJAMIN
Director of Applications
STEPHANIE
BERRY,
Director of Compliance
BETH HOFFMAN ,
ESQ . ,
Investigator
SEMELE
GEORGE ,
Public Relations
DORENE
LEWIS ,
Board Liaison
PORTER ' S
COURT REPORTING,
INC
P . O .
Box 11303
St .
Thomas,
Virgin Islands 00801
TRANSCRIPT
BY
PORTER ' S
COURT REPORTING ,
INC.
( 340 )
775 - 2428
INDEX
ITEM
DESCRIPTION
PAGE
Meeting Called to Order
Roll Call
No.
1
.
.
3
.
Review and Approval of Agenda
4
Cases for Public Hearing
a
Southern Trust Company,
Inc.
b
DIAM Management
c
Asset Recovery Management,
Inc.
65
(Hearing Adjourned . )
TRANSCRIPT BY
PORTER ' S
COURT REPORTING
INC .
(340)
775 -2428
PROCEEDINGS
THE
CHAIR
:
Good morning
I ' d like
to call to order the Economic Development Commission Public
Hearing.
Can
I have
a roll call, please ?
MR.
PENN
Commissioner Bryan .
THE
CHAIR :
Present.
MR.
PENN :
Commissioner Simmonds.
MR
SIMMONDS:
Here
10
THE
CHAIR :
Commissioner Allen .
MR .
ALLEN :
Here .
12
MR .
PENN
:
Commissioner Penn,
13
present
14
Commissioner Smith .
THE CHAIR :
Excused ,
16
MR .
PENN :
Commissioner Millin
17
Maduro .
18
THE
CHAIR :
Late
MR
PENN
Mr.
Chair,
you have four
20
members present .
THE CHAIR :
Having established
a
22
quorum
are there any changes to the agenda
MS . HILL :
Mr.
Chairman,
good
24
afternoon.
I ' d like to thank all of the board members for
25
being here .
I ' d like to acknowledge the presence of the
TRANSCRIPT BY PORTER ' S COURT REPORTING ,
INC.
(340)
775 - 2428
staff that '
s here
relating to the EDC
Public Hearing and to
introduce starting with
introducing our new Director of
Compliance, Miss Stephanie Berry .
And we ' d like to welcome
her to the team .
And she is bringing to the table
a great
deal of skills and we look forward to her adding to the EDC
program with
a very varied background that
she brings
She
is a
Ph . D .
candidate in
industrial psychology and management
and
is
quite familiar with
the
government
processes .
So
we
want to welcome our new Director of Compliance and to also
acknowledge
- -
I
know
that my counsels have all been
introduced to her by
e -mail
Welcome,
Stephanie Berry .
Attorney
Smock
is here,
Counsel to
the Board,
Attorney Beth Hoffman, our investigator, and our Public
Relations representative, Semele George, and of course our
Executive Assistant to the Board is with us today.
We are
happy that she' s here.
She' s feelingbetter.
Glad that you
17
are here
18
And,
Mr.
Chairman ,
in
response to
your
question
19
with regards to changes on the agenda, the agenda as is
presented to you is as it is.
The original document you had
in your drop box were amended because counsels have all
agreed, Counsel Erika Kellerhals and Attorney Roberts agreed
21
to shift their clients presentations.
So we will start with
Asset Management,
sir,
as you deem appropriate.
THE
CHAIR :
Asset that' s what ' s
on
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5
agenda.
MS.
KELLERHALS :
I think we are going to
go first,
Southern Trust .
MS .
ROBERTS :
I
thought
we had
agreed
- -
MS .
HILL :
You are going to go
first ?
MS
KELLERHALS:
Yes.
MS.
HILL :
That' s right
I
10
apologize .
You
did
say
that .
11
And we would like DIAM
MS . ROBERTS :
to
go before Asset Recovery .
12
13
MS.
HILL :
That' s the reorder of
the agenda .
Thank you .
15
MR
PENN :
Mr.
Chair ,
I ' d like to
16
move that the agenda be amended that Southern
Trust
Management
Company be the first
item for public hearing to
be followed by DIAM Management , Inc. and then Asset Recovery
Management ,
Inc.
So moved,
Mr .
Chair .
THE
CHAIR :
Second?
MR .
ALLEN :
Second
THE
CHAIR :
Properly moved
and
seconded .
All those in
favor ?
( Chorus of Ayes )
THE
CHAIR :
Opposed?
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(No Response)
THE
CHAIR :
Abstention?
(No Response)
THE
CHAIR :
Motion carries.
Motion to accept the agenda as amended
MR
PENN
So moved
Mr.
Chair .
THE CHAIR :
Second
MR
SIMMONDS :
Second
THE CHAIR :
Properly moved and
seconded .
All those
in
favor ?
11
(Chorus of Ayes)
THE
CHAIR :
Opposed ?
3
(No Response )
14
THE
CHAIR:
Abstentions
?
(
Response)
16
THE
CHAIR :
The agenda
stands
17
approved.
18
Cases for Public Hearing,
Southern Trust Company.
19
Who
speaks
to
this
matter ?
20
MS .
KELLERHALS :
I
do .
21
THE CHAIR :
Mr .
Smock,
could you
swear
in the testifiers ?
( Thereupon Erika Kellerhals,
Esq.
and Jeffrey
25
Epstein were duly sworn
in by Attorney
Smock . )
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MS.
KELLERHALS:
Good afternoon,
Chairman, Commissioners and Staff
I appreciate the
opportunity to come before you today and
with you
regarding my client, Southern Trust Company, Inc.
I ' m here today with Mr. Jeffrey Epstein who is
the President of Southern Trust.
And after a brief
introduction
covering the business and its compliance with
the statutory requirements of the EDC program,
I' m going to
turn the floor over to Mr. Epstein and he will talk to you a
littlebit about the new business model.
Southern
Trust , which will be located on the
Island of St.
Thomas is applying for benefits under Category
a designated
service business .
And once it gets up
and running it will provide cutting edge consulting services
to companies around the world lying in part upon the use of
biomedical and financial informatics .
The client base for
this company is going to range from individual consumers to
scientist, to investment companies looking to create new
strategies using what ' s called mine information.
I want to
get
a
few housekeeping out of the way and on the record
before Mr . Epstein explains to you exactly what it is they
are going to be doing.
Southern Trust is going to meet all the statutory
requirements including that with respect to capital
25
investment.
In fact
Southern Trust has indicated
in their
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application will exceed the statutory investment requirement
of $ 100, 000. 00 .
We 've also set out a detailed employee benefit
plan.
And one of the things that ' s noted about the plan
itself is in addition to providing generous lead packages,
life insurance and a donated leave program , the company
actually includes one hundred percent employee and dependent
coverage for health insurance.
the company will absorb
the cost of all health
insurance.
And
they have agreed to
a
10
minimum
$ 50 , 000 . 00 per year charitable contribution
in
11
addition to the mandatory contributionsto the Territorial
12
Scholarship Fund and the Department of Labor
database .
And
13
those of you who know Mr.
Epstein he hasbeen
a long- term
resident of the Virgin Islands know that he has given
15
generously over the course of the last 11 years to various
charities in the Virgin Islands.
16
17
We did request
as part of the application
a
18
waiver of the employee requirement for the first five years
down to five employees .
There were
a couple of different
20
reasons for doing that .
One is as Mr . Epstein explains and
as we explained in the application ,
there are some very
22
specialized job positions needed by virtue of the business
model and what the business itself would be doing
And it' s
24
anticipated that getting to maximum capacity and finding the
25
right
employees will take
a significant period of time .
And
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as a result of asking for that waiver of the employment
requirement down to five , we are also asking that the
percentage residency requirement also be amended
from
80
percent to
50 percent for the first five years.
I 'm now going to turn the floor over to Mr.
Epstein and he can talk to you
a littlebit about his
background in this business in particular.
MR. EPSTEIN:
Thank
you .
What ' s happening in today ' s environment is the
10
fact that most everyone here has a computer in front of
them .
Most of the time if you look back
25 years if you
12
wanted to know whose genetics determined your current
circumstance , if you wanted to get financial advice, if you
13
14
wanted to
get medical advice you would go to one doctor.
15
You would , hopefully,
choose the right doctor and he would
according to his experience say,
fine, maybe you have
a
17
stomach ache and we have in
response to your problems three
or four
solutions .
20
In fact if you were going to go into the Army
years ago they classified your health like only five
categories .
Were you sort of very healthy , healthy or were
22
you
F - 4 .
Everything was very general and very broad
categories.
As you all are aware everything nowadays has
25
become personalized.
You have your clothes that you wear
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10
can be custom made.
Everyone has many options on how to set
their computers.
What ' s happening in the world is that
many decisions that used to be made by one single individual
now it' s impossible to get accurate
information without
| accessing vast
numbers of databases .
What
Southern Trust
will do will be basically organizing mathematical algorithms
so that if I want to know what my predisposition is for
we can now have my genes specifically sequenced .
Unfortunately, it hit home as of yesterday for me
exactly what my company does .
One of my closest friends was
diagnosed two days ago with
a terminal cancer .
Now he' s at
the best hospital.
I ' ve known him since I was six years
old .
His
tumor needs to be sequenced .
We will spend time
going through
the
DNA of his exact tumor .
Now that was the first
step that ' s
available
today .
It hasn ' t been available ever before .
But that ' s
only the first step .
Now
we know specifically what type of
cancer he has.
In the past unless
you are lucky
enough to have
the right doctor when you went to diagnose that problem
and
he can
say , well,
Jose or Albert
I' ve
seen this before and
you were out of luck
Now what we ' ll do is we ' lluse this
one
sequence , his own
DNA and the specific problem
he has
with his cancer and access worldwide databases of every
drug,
every single drug across the world that ' s been tested
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| on all different types of cancers that specifically have his
sequence involved .
So the chances of a successful
treatment are now viable where before as he said last night
he would be dead in four weeks.
as of medical advance you are able for the
first time to have custom made medicine but you can' t do
that without accessing a vast database of information .
Even
if you are the best doctor in New York or California or
here,
you can only read what you can read.
You have 24
hours
a
day
The new sequences in biomedicine will allow
you to access every publication that affects your area and
you don ' t have time to read it.
So my company ' s algorithms will in fact digest
the information as best as they can currently and then spit
out its recommendations .
you' ll have computer generated
solutions for medical problems, which is the next century ' s
work on how to get people healthy.
My real business has always been money
People
want to know which companies to invest in and you might have
been lucky enough -- I was poor but if your parents had any
money and they wanted to simply find the stock to buy or how
to invest their money, again they had to find
a stockbroker
or
a local banker or someone they could go to and ask their
advice
And that one person ' s advice was only as good as
the college they went to or their experience
in the
25
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business .
Now,
just as I
- - with my friend or as
a simple
example years ago if you had asked me what is the name of
George Washington ' s horse?
I lived in Coney Island.
George
Washington ' s horse, okay, what would I have to do ?
I' d have
to get on the bus and go to the library .
I ' d have to ask
the librarian for
a book on George Washington .
Hopefully ,
somewhere in the appendix would be
a note that
said George
Washington ' s horse or otherwise
I was
in trouble .
I ' d have
to
actually read the book .
I would then go back, make a report,
come to my
school.
And as you all know right now we go
to Goggle and
in
a nanosecond Goggle searches
10 billion documents for the
| names of George Washington' s horse.
And you can find out
what
the horse ate for breakfast on
a
certain
day .
18
my company will then take the concept of
building these search algorithms but not searching the
information for the name of George Washington ' s horse but in
fact searching the world' s databases for what is the best
investments.
I can ' t spend 24 hours a day going through all
the investments around the world but my computer can do it
20
in
a nanosecond.
3
24
Unbeknownst to most people today again when I
first started on Wall Street I was a school teacher .
The
stock exchange traded
a couple of million shares per day and
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that was
a big - - and if you had a 100 million shares a day
it was
a calamity.
Now
everyday, every minute those numbers
N
W
of shares are traded but not by people.
Seventy-Five or
Eighty percent of all the trading around the world -- when I
say trading , all the statistics
you read about how many
shares traded today is done by
a computer.
In fact some of
the computers trade thousands of times per second buying and
selling at small increments.
So the speed at which decisions are made you have
speed by computers but you need
a
search
engine,
just like
Goggle has
a
search engine for
documents,
a method to
search
the financial arena for the best investments in my financial
13
arm of Southern Trust and the best medicine.
again if it
was me personally - - this again it hits very close to home.
I ' m leaving for New
York after this meeting to go sit with
the sequencers to see if I can save my friend.
And this is
17
18
the first time in history that it' s probably
a chance
because most people don 't know when they say you have lung
cancer, cancer is not really a thing.
It' s not like -- you
see we used to - - the past
30 years we know
we had
a
disease.
You had the flu or you had some type of liver
disorder .
Cancer is very different.
Cancer is not a thing.
It' s
a process.
It' s
a process.
What do I mean
that?
It doesn' t mean I have
25
something in my lung that has a little " C" that says cancer.
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Itmeans that my lung is doing something.
It is
a process.
It is cancering.
My lung is cancering or my prostate is
cancering .
In my
friend ' s
case his brain ,
bones
and liver
are cancering.
in the past
- - unfortunately
anyone
diagnosed
with
a disease for lung cancer you could only treat them
with
a lung cancer approved drug
Like I have
a breast care
center
in
New
York .
So now it turns out that many females
for breast care you can treat it with things that were only
used before for prostate
And the only way they got to that
11
is they realized that
in certain
studies
in the Netherlands
just by these
search
engines
there had been
good results
based
on the computers being able to
search
the database,
the solutions for specific types of problems .
Why the Virgin Islands?
Again we have high speed
connections in St.
Croix .
I have to beg both servers to
hold my database information .
The high level people that
Erika mentioned is
I need high level mathematiciansto
come
down
and help program
the computers .
Some people actually
have to be here
and monitor
the computers.
And these
algorithms -- it' s
amazing but true -- much of the work
hopefully to be done later in life.
So that five,
ten
years away is the computers
themselves will help
redesign
some of the computer programs
Just like in the cars we first built some
computers to help
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manufacture cars.
Now the computers are helping to
design
They in fact design their own little parts.
In the new version you can actually printout just
like a fax machine started 20 years ago, you could have the
computer design the part and make it
It actually prints
parts.
So
Southern Trust will be basically building up a
database
searching mechanism
to
search
things
on
an
individualbasis both in the medical field and the financial
field
Again it' s
an exciting area that the idea is that
the diseases that affect
the local population
- -
I
do lots
of work in Africa.
backup Africa is for me a fertile
ground for experimentation because it has been so
underdeveloped it is not burdened with the current
system .
What
do
I
mean?
17
When telephone companies now
come to places like
Senegal where I was a couple of months ago, they don ' t put
copper in the ground.
They don ' t have to worry about laying
cables and going to everyone' s house.
They leapfrog the old
systems going directly to cellular.
though Senegal and Ivory Coast are poor
countries,
70 percent of the people have cell phones because
they were able to not deal with the local in -breaded
telephone companies who had to charge
a ridiculous sense of
money because they had already laid all this pipe and copper
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in the ground .
The same thing here, Africa has almost no
medicine .
It' s difficult .
But with searching as opposed to
testing people everyone is not the same, not everyone needs
8
an aspirin and not everyone needs the same aspirin or the
same amount of aspirin .
The idea would be to build up a
personal medical database for lots of people .
That ' s it.
And ask as many questions about the
subject .
I enjoy it.
MR. SIMMONDS :
Good afternoon .
I get
the financial part.
I mean you got
a billion dollars to
invest.
You search for the best investments and you invest
other people' s money.
The medical part I 'm not sure I get as yet.
I
mean I'm not going to ask you how much
something like that
13
15
would cost because it sounds like it would be really
16
17
expensive.
But who are you catering too ?
I mean people are
going to come to you and say , you know what, I have an
ailment.
I need you to search and see if there is a cure.
18
MR . EPSTEIN :
No, it ' s the drug
companies .
To develop a new drug now cost a billion dollars
because you sort of start from scratch and it' s really like
trial and error in your backyard, trying to figure out which
piece fits in this screw .
So the drug companies spend the
first
five years testing all the different parts to see if
will work
on this drug -- on this disease .
The drug
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companies would much rather have my computer do the trials
and errors.
MR.
SIMMONDS:
But you are not testing
|anything.
You are basically just searching for already
tested products .
MR . EPSTEIN :
The algorithms
7
themselves will be almost like a chemistry lab in the
computer.
In the old days when you had to test for
something you had to actually build it to see if it would
work .
When the Wright Brothers built their airplane they
flew it and it crashed
They flew it and that ' s when they
changed the wing.
And now what you do is you design it in the
computer.
The computer inside all the new space ships are
all designed by saying here is the wind, here is the gravity
and the product comes out at the end.
So there is big drug
companies that want to know what' s the most likely pathway
to hit this type of disease .
MR
SIMMONDS :
Why would it take five
years before local folks could be trained in doing this sort
of
- -
MR . EPSTEIN :
It won' t
take five
It
will be growing simultaneously because the mathematics it' s
|
the new programs. For example, the last Windows
program that came out last week, Windows 8, took 600 people
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six years to do .
Now it' s not that many people but you need
level programmers.
I would like to have young people - -
I ' m
a
teacher by heart
- -
engaged early on .
But the programming
initially will take
to
get
up
and
running and been
testing it until it sort of becomes a model for its
performance
MR.
SIMMONDS:
Thank you.
THE
CHAIR:
Mr.
Allen .
MR .
ALLEN :
Good afternoon,
Mr.
Epstein.
I ' ve been listeningto you quite intense.
You are asking for five years exemption and you
need instead of 80 / 20 ,
you need 50 / 50 .
You know that ' s
going
to take going back to the Legislature
to
change the
statute
MS.
KELLERHALS:
We are
aware that they
did bring in
an
amendment
to
go to
the Legislature
- - that
the Legislature actually passed legislation
that would
reduce the number of employees to five.
I understand that
it was vetoed by the Governor .
But based upon my
discussions with the EDC staff it was my understanding that
this time based on the circumstances of each applicant it
would be considered .
MR .
ALLEN :
That '
s
the
reason
why
25
it' s
in this proposal?
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MS.
KELLERHALS :
It' s in the proposal in
part because it fits the business model better.
It allows
them as Mr. Epstein explained there is that ramp up while
they are getting the programs together .
MR .
EPSTEIN:
I much rather it be
shorter frankly .
MR
ALLEN :
You much rather it be
shorter?
MR
EPSTEIN :
Sorry
I would like to
get it done as fast as possible.
MR.
ALLEN:
Yes,
I understand that .
But some of the computer models that you discussed it' s so
way out.
Is this your thinking or this is something that is
on the market that you are trying to tap into ?
MR.
EPSTEIN :
I
am not a mad man
16
might appear that way.
.
ALLEN:
No,
I ' m
just asking if
this is your thought brand new or there is something out
there that you are trying to bring it here.
MR
EPSTEIN :
Both .
There are
products just beginning.
They have not yet been fully
developed.
Database mining is a very -- product is probably
the wrong word .
The database mining which miningmeans as
in the past you got to dig into the ground.
Here the
concept of database mining is very well established but not
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in
these
two areas .
Normally,
for example,
as you know when you go in
your
computer it might target you for
a specific type of
advertisement because it knows that after you 've been
searching for French fries.
So they mine all the people in
the area who is looking for French fries and said, you know ,
Randolph seems to like that .
So we'll send him
a message.
So the concept itself is very well established,
9
using the medical really the next couple of years.
MR .
ALLEN
:
I have no more
questions.
THE CHAIR:
How do you get around
all the proprietary medical information, though?
I mean how
does that
- -
MR.
EPSTEIN:
Because you initially
start out - - most people they opt in or opt out.
Sometimes
they , even for the first sequencing, potentially to answer
your
question, when the human
geno project is first begun
a
question came in if they sequence my geno, my personal geno,
is that information tied to Jeffrey Epstein or will it be
anonymous ?
And everyone whose genes get sequenced has the
right to say I don ' t want my name associated with my gene
because maybe if I have something that' s bad I might have
a
rocker gene from
a woman pre-deposing me to breast cancer
won ' t
get health
insurance .
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So the decision of having your name associated
with the sequence is your decision.
However, the sequence
then goes into a big pile and says the person who had that
sequence was responsive to this drug .
So there is no name
attached.
there is no privacy issue.
If it turns out that most people don' t mind
having their names I was surprised.
But most people say ,
look, if I' m doing something good for society and it' s
helpful you say, yes, I 've had a problem and if I can help
others my name could be attached.
That ' s
a
decision
I would
make .
THE
CHAIR
:
So it '
s
a biomedical
Goggle that
- -
MR .
EPSTEIN:
Yes .
THE
CHAIR :
- -
that tracks genes,
preference gene receptivity to different medications
in
order to make doctors more efficient.
MR.
EPSTEIN:
Yes,
and drugs more
efficient .
THE
CHAIR :
But how do you get paid?
MR .
EPSTEIN:
The drug companies
instead of having -- as I said imagine having your own
little chemistry lab in
a computer as opposed to having a
thousand people .
So they pay me for the algorithm .
THE CHAIR :
they pay you
a
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membership fee to access your server or they pay you for an
algorithm that
you actually sell them
instead?
MR
EPSTEIN:
There will be
just
like
in any other product because there are different algorithms.
Some will be outright purchases, probably the simple ones .
There will be leases for longer runs and most people will be
coming back .
Sometime if you want to
know -- just like a
search
engine in answer to one question .
you get paid
for that one piece of advice, ongoing advice
exclusive
rights like drug companies might want to have for
a specific
11
answer .
THE
CHAIR :
And these mathematicians
13
build these algorithms to build themselves or they build
14
algorithms specifically for whatever
question is posed
because I know you mentioned -- I still want to know why you
16
have
a server here,
though ?
MR.
EPSTEIN:
I ' d like to have
18
everything here for security purposes.
As you know
everybody is hacking servers .
The only way really
19
unfortunately to make sure you are secure is to have
location wise.
Once you put your server --
THE
CHAIR :
So
your
server will be
23
more or less your vault rather than
a server
to power
anybody
else
anywhere else ?
25
MR .
EPSTEIN :
Yes,
yes.
The
systems
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everything is interconnected.
But again the only real way
to have certain types of things is servers that are not
connected to the Internet directly .
THE
CHAIR :
How do you anticipate
that this business will grow
so that it would actually
affect
employment ?
MR
EPSTEIN :
Because if things
go
as
8
I planned it will need a significant number of people,
hopefully, again, probably between five to ten years or
maybe more operate a virtual laboratory
you need lots
of people.
You need to watch and help the mathematicians .
It' s accessing the computers and training people to operate
the systems.
As you know if you thought about it years ago,
20
years ago if we said we are going to have to program
a
computer, it' s impossible .
I can ' t
do it.
I 'm
a pretty
good mathematicians
But now students coming up can program
things that were unthinkable years ago.
THE CHAIR :
And the office
space or
will there be an office space ?
MR .
EPSTEIN
Yes ,
sir .
THE
CHAIR :
It will be in St .
Thomas
MR.
EPSTEIN:
Yes,
sir
THE
CHAIR :
But the server will be
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1
on the level three establishment
on
St .
Croix ?
MR
EPSTEIN :
Don' t
know yet .
THE CHAIR:
Because
I
know
I
heard
you mention
St
Croix
and the access
the band.
But you
are figuring you can
tap in
a fiber anywhere
and get there ?
MR. EPSTEIN:
Yes.
You want the
| access.
So that ' s really for the trading aspects .
It turns out
- -
and
again it' s
an interesting
fact ,
that
computers that
trade,
the algorithms that ' s
a
different part of the business,
the computers that trade it
makes a tremendous difference if you have fiber and high
speed fiber but not high speed fiber .
So just as
a silly example there was
a
company in
New York that moved its offices three streets closer to the
stock
exchange and paid millions of dollars to upgrade their
space
so they can be three streets closer because then they
get
an
edge .
MR
SIMMONDS:
Mr.
Chair,
if
I might
follow - up
on
something that
you asked ?
THE
CHAIR :
Sure
MR .
SIMMONDS :
So what then
do you
see
as the economic benefit
to the territory ?
MR.
EPSTEIN :
Well,
obviously,
hopefully
- -
MR
SIMMONDS:
I mean
you
are
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suggesting that it will be at least five years,
maybe even
longer before you start ramping up employment.
MR .
EPSTEIN :
I
think
there will be
revenues of a
considerable number of millions of dollars at
the
end of the fifth
year .
But the ramp up these are high
dollar
revenue
items to
the
company .
obviously
in
terms
7
the taxes and in terms of employment.
MR .
SIMMONDS:
I ' m
sorry ,
taxes for the
five or so individuals that - -
MR .
EPSTEIN :
No, no,
the business
taxes .
MR
SIMMONDS:
The business taxes ?
MR .
EPSTEIN :
Yes ,
sir .
MR .
SIMMONDS :
But you are getting
an
exemption .
KELLERHALS:
Right,
but the
exemptions are only 90 percent on eligible income.
MR.
SIMMONDS:
you are saying that
the 10 percent would be substantial for the territory ?
MR .
EPSTEIN :
Yes
The answer is
yes" .
And combined with employment it ' s
a little down
side .
THE
CHAIR :
How
was this
- -
MR.
SIMMONDS :
You are already
a
resident
of the Virgin
Islands,
right ?
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MR .
EPSTEIN :
Yes,
sir
I
also have
homes in New York
and Florida .
Most people prefer - - I
prefer to be down here.
This is my favorite place to be.
s
a more difficult business environment but
I prefer to
I prefer to have my employees here .
I ' ve had
a
very successful time here.
THE
CHAIR :
How is this different ,
8
financial side than what you were doing before?
MR.
EPSTEIN
What
I was doing before
10
was really financial advice which
is almost
I
don ' t
want to
12
say antiquated but somewhat.
You would
come to me and say
what should I buy?
And I' ll use my judgment based on
30
years in the business of what you should buy .
I didn ' t
really use computer
search engines to find it .
It' s
a
very
15
different
business .
This is not financial advice.
This is
16
the mathematics and the product of financial algorithms for
17
sale .
18
THE
CHAIR :
So you have clients that
have invested in this and these algorithmsproduce not
information but
- - they do produce information but it
actually trades based on that information.
22
MR .
EPSTEIN :
That ' s correct .
THE CHAIR:
The computer.
24
MR .
EPSTEIN :
Yes ,
the
computer
can
25
trade .
And the client they can either buy its position in
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algorithm or can have advice but I prefer only the
| algorithm .
I don ' t want to do financial advice .
This is
much more sophisticated.
THE
CHAIR :
When
you say they buy
a
position in the algorithm , you can invest in an algorithm ?
MR . EPSTEIN :
Yes.
So if you go on ,
for example, many trading sites you , yourself,
can sign
up
as
a subscription and say
I
get the Albert Bryan newsletter.
When
you
think
about
that what was that ?
That was
someone
who is willing to pay you
a monthly fee for your personal
11
advice .
Here we do the same thing except it ' s not
a person.
12
It' s
a
computer.
13
THE
CHAIR :
Why isn ' t
this
a
Tech
| Park business,
though ?
15
MS .
KELLERHALS :
We couldn ' t
come to
an
agreement with
the
Tech
Park
So
there is an understanding
17
that we could
go to the
.
THE
CHAIR
Because I
was trying to
figure out if there was
a distinctive difference because it
is
a little different.
It is an
Internet provided service
but your core business is not really Internet.
MR . EPSTEIN :
No,
it'
s
database .
THE
CHAIR :
It'
s
data .
MR
EPSTEIN :
Yes
data and it'
s
management .
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THE
CHAIR :
Right,
I
go it .
MR .
PENN :
In the projections you
have two revenue lines,
fee income and investment
income.
It seems that
- -
is the fee
income both the medical and the
financial?
MR .
EPSTEIN:
It' s
a mixture.
Again
according to what the client wants to do , whether they want
to have
a single - -
you can
invest,
for
example,
in the
follow -up in only the bond algorithm .
So you would then be
paying for your piece of a bond algorithm.
If you wanted to
10
11
have more you would be fee for the entire business .
12
MR .
PENN:
I was
just trying to get
a feel for how much of the business you estimated because
your estimate would have been medical versus
financial .
15
MR.
EPSTEIN :
I think it will move.
I
16
think it will start off being more financialbecause the
17
medical is much more sophisticated .
But in terms of overall
m
sort of
doing good thing,
hopefully,
I think
the medical
19
area would be more exciting .
MR.
PENN
And how many people
would you say would you need to do what you project for year
five ?
I ' m not going to put numbers on the record but I see
nearly
a doubling of your estimates between
year
one and
24
year
five
and I ' m
just trying to figure out
- -
25
MR
EPSTEIN
I wanted
to be
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conservative .
If things
go well we ' ll meet
a
lot of people .
MR
PENN
But
I mean
I
guess with
question you had before about the mix
50 / 50
- -
MR . EPSTEIN :
Yes.
MR.
PENN:
- -
in
year five what do
you project that to be to generate what you project even
though it' s conservative?
How many bodies are you
considering?
MR .
EPSTEIN :
Again
I would like as
many as possible
frankly .
But the
idea is how well will
a
product this mechanism take.
Especially because it' s
| medical you don ' t
want to sell
something before it '
s
ready .
And once it' s ready then there would be people in the
marketing department .
There will be a bunch of other
things.
So it' s difficult
to put
a number
on it.
MR .
PENN :
How
do you market that ?
MR .
EPSTEIN :
Well,
for the medical
things through
the drug companies as well as certain medical
NIH, the hospital divisions, the medical countries.
Iceland
is one of the few countries - - and that ' s another discussion
at some point because Iceland is an isolated community and
they have 50 years of genetic
information.
So everyone in
Iceland has
a
genetic sequence and you can
then
see what' s
happening,
the children ,
what was really inherited .
Is
cancer
inherited,
not
inherited .
Is schizophrenia
by
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simply
looking at all the data
that was accumulated ?
Places,
frankly,
like St .
Thomas are the perfect
place to sequence people because it' s so isolated.
You are
able to get much better data than ever before.
And it also
ends up -- and that ' s one of the advantages ofbeing here as
opposed to New
York .
THE
CHAIR :
But when
I think
of
genetic sequencing - -
and I
know we are getting way out on
a
limb
MR .
EPSTEIN :
No,
ask
THE
CHAIR :
I mean I
would think
would have to have some DNA sampling of these
people
going back for
50 years and 50 years ago we didn ' t
have that type of technology
So how
do
you
- -
I mean
people have died.
How do you trace that ?
How do you do
sequencing of somebody who is no longer here ?
MR. EPSTEIN
In Iceland they 've kept
the sequencing .
They started taking blood.
they have
kept blood samples from everyone.
That was very forward
thinking.
So they were simply able to get the sequence out
of the blood.
THE CHAIR:
Got
you .
That
was
confusing
MR .
EPSTEIN
Yes,
it' s 50 years of
25
data .
It ' s
the
only country
It doesn ' t
make them
any
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1
healthier at the moment but they have tremendous amounts of
data but almost no information .
THE
CHAIR :
!
MR .
EPSTEIN :
Because now
they have
300, 000 people and all their ancestors.
Now what do we do
with it
It was the
same problem
when
we had the human
geno
It was
a book of three billion letters and it took
ten years to do and three billion dollars to do it, three
billion dollars to do it only ten years ago .
That same
sequence you can now walk into your doctor
and have it done
for $65.00.
You can sequence your entire geno for $65.00 .
MS
MADURO :
I have one question for
Legal Counsel.
So
through the Chair may
I
ask my question
to
Legal Counsel ?
With respect to the fact that the Governor has
vetoed the proposed legislation,
how will that impact us
inasmuch as we are in
a public hearing and this board is
going to have to later decide moving this application
forward without the approved legislation?
MR .
SMOCK:
You ' ll have to remind me
which
legislation are you talking about?
MS.
MADURO :
the amount of
employees that the companies may have.
Traditionally we
25
would approve an application with
a minimum of 10 and move
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forward in the event that the applicant cannot ramp up to 10
we would do
a modification or
a waiver of employees.
But in
this instant we are going to start out knowing that we are
not going to have
10
employees .
MR.
SMOCK :
we ' ll be dealing with
the old legislation.
THE
CHAIR :
But the
law allows for
us to waive the employment
in any case .
MR.
SMOCK :
If we wish .
THE
CHAIR :
For due cause only
because those employees are not needed.
12
MR .
SMOCK:
If we wish to.
MS.
MADURO :
True .
But we
14
15
traditionally
do it by coming back to public hearing .
So in
the interest of time and because we now
know that the
applicant
is not intending to ramp
up to that I think
it
16
should be notated on the record so that we don ' t have to
come back
in the event that the applicant is approved to
a
waiver process or
a modification process on it.
MR .
SMOCK:
I believe it' s already
a
part of the application.
THE
CHAIR :
How many more people are
doing this?
MR
EPSTEIN:
There is
a couple doing
25
in California.
Steve Jobs had a
group that was trying to
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help him
and it was a little too short.
They didn ' t get it
done in time but they were getting there.
In fact the last
day of his life they thought they were able to sequence his
gene in
a way and maybe find
a useful drug and he had
enough .
They said we think we can try
a new
one that' s
specifically tailored for your specific problem and he said
I can ' t
do this anymore.
And then they had a big meeting.
They tried to convince him to try it andhe said I 'm
done.
THE CHAIR :
Where are you getting
your mathematicians
from ?
11
MR .
EPSTEIN :
Usually from the United
States
THE
CHAIR :
That' s
a big place.
14
MS.
HILL:
I ' m
sorry
where ?
MR . EPSTEIN:
United States.
I had
16
hoped to get some from Europe just like engineers but it
turns out that they
don ' t exist anymore and anybody in this
17
level of mathematics anywhere ,
they
don ' t
exist
in China
because you need
a bit of
a creative person
opposed to
simply a copy cat.
They don ' t exist in Europe.
And if you
are really
good you are already here .
So the universities
usually
THE
CHAIR :
So you already have one?
MR.
EPSTEIN:
I 've had one.
THE
CHAIR :
And what was his profile
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like ?
MR .
EPSTEIN :
Harvard.
It' s usually
Harvard, MIT.
But this is Harvard and he used to be at the
| institute of advanced studies at Princeton
THE
CHAIR :
So
in
your
five - year
plan you are going to send some Virgin Islanders to Harvard?
MR.
BRYAN:
No,
I want to train them
here .
THE
CHAIR :
How do you do that,
10
though ?
11
MR
EPSTEIN :
Because it' s much
- -
you
12
have to start off thinking that,
for example , Algebra is not
13
as important as it used to be
Programming is important.
14
And you don ' t have to --
in the old days you have to
17
actually poke holes in the card to program .
And now the
younger people can have their little abortage (phon ) do
things simply by typing
in
and raise the abortage
right-hand.
You type it in and it already programs .
So advance programming is very different .
It' s
nothing -- I' m sure if you have children
how they text , for
example, they speak in B2B, see you soon .
You could ask me
five minutes ago how
am I going to teach -- one of the
problems is how do you teach kids to talk because
in fact
they are starting to talk as they text .
adults don 't
understand it .
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THE
CHAIR :
Is that what it is ?
MR .
EPSTEIN :
Yes .
THE
CHAIR :
So are you planning - -
and I know you have contributed generously before
So are
you planning to do
- -
I know we have one applicant that
started our Junior Achievement Program
and we have some
others that did
a financial piece that seems to be
successful at Charlotte Amalie High
Junior Achievement has
gone viral.
It' s all over the Virgin
Islands now .
Are you going to do any programs to start to
build that type of interest and expose young people to that
kind of --
MR. EPSTEIN :
I' m willing to do any of
those things .
Again I come from a background where I had no
money and it was only by understanding math and science that
I was able to live the life I currently lead.
I would
love to
do it.
THE
CHAIR
:
Any other questions?
MR.
EPSTEIN :
I 'llbe more than happy
in some other forum to sit down and say fine .
In fact in
some of the scholarship money that
I have given before here
in St .
Thomas was to try to find children
to
go to visit
Harvard,
encourage them .
One of the things I did
years ago is I
brought
a whole bunch of Noble Prize winners here to St .
BY PORTER ' S COURT REPORTING ,
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36
Thomas
for lectures at the university
again
so kids can
see
they
don ' t
have to be
in the music business.
Science
is as
| fun and exciting.
MR .
SIMMONDS :
One of our board members
is the Provost at UVI.
we certainly will have him get in
| touch with you and see what kind of programs could be
developed in conjunction with UVI to train mathematicians .
MR . EPSTEIN
Not only mathematicians ,
in fact it ' s
a
longer discussion.
I ' m willing to have as
10
many discussionsanybody here would like to have on the
record, off the record.
But that Apple
computer sitting in
front of the Chairman has more teaching ability than all the
teachers in St.
Thomas but people don ' t
understand how
to
14
use it yet still, not only here but most places because the
teacher unions don ' t like that
idea .
There is
something that
I would always
encourage
adults to
do as
I would
encourage all children
is
something
that some people know
about and
some might not .
It' s called
the Khan Academy,
K -h - a - n ,
Academy.
Now if you haven ' t
seen
it you should
go
on line.
It teaches every subject you
learn
in high school.
You can watch it when
you want .
It' s
simple .
You don 't feel embarrassed if you don ' t understand
it the first time because you
can play it over and over
again .
You can blog with other children or people your
own
age to learn the same subject or maybe having the
same
BY PORTER ' S COURT REPORTING ,
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problems you have .
I don ' t
understand how miosis works or
mitosis
in bio -medicine.
So
I
can blog now
and say who else ?
Can someone
explain to me how the chromosome split and they get answers.
, it' s a tremendous amount of things to be done.
THE
CHAIR :
You know we were having
that discussion the other day and that ' s
a serious shift
now .
Because the most important thing is teaching kids how
to learn on the Internet because all of the information is
already there .
They don ' t need to sit .
Florida has this
future school I think it' s called Florida Virtual School.
And they have their whole high school curriculum on line for
anybody in the nation to
go on and do it .
But in the Virgin
Islands like Iceland we are in the middle of nowhere.
MR .
EPSTEIN :
You see that ' s sort of
16
insensibly the same thinking I grew up with.
But the middle
of nowhere just like Africa you have
an Apple computer
sitting on the Internet.
So in fact you are not
in the
middle of nowhere .
You are
in
the middle of everything .
You are in the middle of everything.
You just have to
understand
how to use this thing.
And it' s not taught
in
the school.
And not only are the computers now used to
say so
you
can learn Algebra but it turns out
- -
and if again let' s
look ten years down
the road if I ' m
successful it turns out
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that with
14 people in the room
everyone has
a different
learning skill and they
learn differently .
Some people are
very visual.
Once
they
see a motorcycle part they can put
it together .
I
can ' t .
Some people need to hear it verbally
because they learn verbally.
Some people learn visually
Some people have
a
combination
of the two.
If you
go back
500 years there was not one person
that
sat in the classroom
and said to the people in the
field sit in here and let me lecture you and
don ' t move
while I do it.
In fact as I described it the thing that
everyone learns to do and really learns well is to walk and
no one taught
them .
No one taught you
to walk .
THE
CHAIR :
what
you
are
suggesting is in
10 years we may be able to have a
- - your
same product that would be able to take
a
genetic code of
how
somebody is,
figure out what
is the best way
for
them to
learn
and put it
on
the Internet for
them ?
MR .
EPSTEIN
:
I
don ' t want to
say
- -
that' s pushing it but yes.
It' s the Frankenstein version
but it' s true , yes.
In fact it will turn out that certain
people can
learn certain things.
Certain people can move
2
through space differently.
your skill set if you think about it the
questions that people ask are questions they have to find
the right person to ask .
You want to find the best doctor .
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you got sick
and
I got sick we
go
to the best doctor.
The best doctor for
a
100 percent likelihood is
connected
on that machine
somehow .
So how
can
you
find that
person
in the right place that ' s connected with that
| information ?
It' s really exciting.
THE
CHAIR:
That
is
MR
EPSTEIN:
Yes , but things like the
Khan Academy you don ' t need - - if you want to learn
mathematics you
don ' t
really need to
go
to high
school .
THE CHAIR :
So why can ' t
we fix the
LEAC,
man , if we can
do all of that ?
12
Anymore questions?
MR.
SMOCK :
Mr.
Chairman,
for
the
14
record to follow -up
on Commissioner Millin' s
question and
15
comments, this application did request fewer than 10
persons.
But Section 708 of Title 29 Subsection F does
provide for the record that:
17
19
21
To be eligible for the granting of
benefits you must employ at least
10 persons on a full-time basis.
And such enterprise and all employees
and such enterprise shall be subject
22
24
to the exceptions contained in Section
25
711of this
subchapter be residents
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of the United States Virgin Islands
provided however that the applicant may
employ fewer than
10
such persons upon
demonstrating to the Commission that the
employment of this
number of persons
in
his particular
enterprise would not be
economically
feasible
or practical.
And
upon
a
further
finding by the
Commission
that the desirability of the proposed
enterprise outweighs the fact that it is
not labor intensive.
I believe this application also ask for
a
residency reduction also .
But it is permitted under the
code if this
commission
so
finds.
MS.
HILL :
And if
I may,
Mr.
17
Chairman,
the amendment to the legislation to reduce the
five ,
we have submitted
to
Senator Malone the appropriate
wording .
And my understanding is that that
amendment is to
be dealt with on Monday by the Committee of the Whole to
address the EDC requirements.
we should be okay.
THE
CHAIR :
Fantastic .
Maybe we
don ' t have to do anything.
Anymore
questions ?
(No Response)
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THE
CHAIR :
Thank
you .
MS .
KELLERHALS :
Thank
you.
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ENT
ONSUMER
DEPARTMEN
THEGOVERNMENTOF THE VIRGIN ISLANDS
DEPARTMENTOF LICENSING AND CONSUMERAFFAIRS
BUSINESS LICENSE
KNOW ALL BY THIS PRESENT
That, in accordance with the applicable provisions of Title
3 Chapter 16 and Title
27
V . . C . relating to the licensing of
businesses and
occupations, and
compliance having been
made
with
the
provisions of
10
. I . C
to
the Civil Rights Act of
Virgin Islands, the followinglicense is hereby granted
Licensee:
SOUTHERN TRUST COMPANY,INC.
TradeName:
SOUTHERN TRUSTCOMPANY, INC.
LANDS
MallingAddress
Address
9100 PORTOF SALE MALL
STE
15
ST THOMAS
ST. THOMAS VI 00802
9100 PORTOF SALEMALL
STE 15
ST. THOMAS
ST. THOMAS
BusinessNo:
21772
LicenseNo:
1-
- 1L
Types ofLicense s)
Business & ManagementConsulting
provided
by
law ,
the authorized
licensing
authority
shall have
the
power
to
revoke
or
suspend
any
License
issued
hereunder ,
upon
finding ,
notice
and
adequate
hearing,
that
such
revocation
or
suspension
is
in
the public
interest;
provided,
that any
persons
aggrieved
by
any
such
decision of this office
shall
be
entitled
to
a
review
of the same by
the Territorial
Court upon
appeal made within
(30)
days
from
the date
of
the
decision ;
provided ,
further,
that
all decisions
of
this
office
hereunder
shall
be
final except
upon specific
findings by the Court that the same was arrived atby fraud or illegalmeans.
2012
W
a renewal is
desired,
the holder is responsible for making application for
same without any notice from
this office. It is the responsibility of the Licensee to
notify the Departmentin writing within (30) days, when
a
license is
to be
cancelled or
placed in
inactive status. Failure to
do
will result in
the assessment
Jpenaltiesas authorizedby law .
from
12/01/ 2012 until 12 31/ 2013
Printed on
12 20/ 2012
at
SL Thomas , V . .
Fee
390 .00
Commissioner, Departmentof Licensingand ConsumerA
THIS LICENSEMUSTBE PROMINENTLYDISPLAYEDAT PLACEOF BUSINESS
View / PrintApplication
Page 1 of 5
ChangeStatus
License Number: 1-21772-
Print 2018 License
Receipts
Change License StartDate
Information
Organization Type:
Contact FirstName:
BusinessName:
SOUTHERN TRUSTCOMPANY, INC.
Last Name:
TradeNames
SOUTHERN TRUST COMPANY, INC.
Phone #
BusinessPhone
340-779-2564
Email:
Business EIN :
660779861
Fax:
Passcode:
46778736
PhysicalAddress
Mailing Address
Streeti
18A - 1,
- 1
&
18B EST SMITH
:
STE. B3- 3 &
B - 5
Street2
City:
ST. THOMAS
City:
State
State:
Island:
ST. Thomas
Island
Country :
US Virgin Islands
Country:
BRETT
GEARY
340 .779. 2564
BRETT @ BIZUSVI. COM
888 -316 -
6100 RED HOOK QUARTER
STE. B - 3
ST. THOMAS
ST. Thomas
US Virgin Islands
Person Information
Person
First Name:
DARREN
Position / Title:
SECRETARY
LastName:
INDYKE
Place of Birth:
Date of Birth
SSN
Click Here to
SSN
PhysicalAddress
MailingAddress
2 KEANCOURT
Street9100 PORTOF SALEMALL
Street2
Streetz
STE 15
City :
LIVINGSTON
City:
ST THOMAS
State
NJ07039
State:
Island:
Island:
ST THOMAS
Country:
US VirginIslands
Country
:
US Virgin Islands
Country of Citizenship :
USA
1. Have you ever been convicted ofa felony or crimeinvolvingmoralturpitude?
N
2. If YES, explain thenatureofthe crime, date of conviction, and placeofconviction:
PRESIDENT
JEFFREY
EPSTEIN
Person 2:
First Name:
Last Name:
DateofBirth :
Physical Address
Click Here to
View
Position /Title:
Place of Birth :
SSN :
MailingAddress
Streeta;
6100RED HOOK QUARTER
B3
9100 PORT OF SALE MALL
STE 15
https:// secure.dlca.vi.gov/UVDLA/Asps/ProcessApp/
aspx ?licno =RdNvmE .
/ 20/ 2019
View /PrintApplication
Page 2 of 5
ST. THOMAS
VI
ST. THOMAS
US Virgin Islands
City :
ST . THOMAS
City :
State:
VI
State:
Island
ST THOMAS
Island:
Country:
US Virgin Islands
Country:
Country ofCitizenship:
USA
1. Have you everbeen convicted of a felony or crimeinvolvingmoralturpitude?
N
2. IFYES, explainthenatureofthecrime, dateofconviction, and place of conviction:
Person 3
First Name:
RICHARD
Position/ Title:
TREASURER
LastName
KAHN
Place of Birth:
DateofBirth
SSN :
ClickHere to
SSN
PhysicalAddress
MailingAddress
Streeti
130EAST75TH STREET
Strecti
9100 PORT OF SALE MALL
Street2 :
APARTMENT
Street2
STE 15
City:
NEW YORK
City
ST. THOMAS
State:
10021
State:
Island:
Island :
ST. THOMAS
Country :
United States
Country :
USVirgin Islands
Countryof Citizenship:
USA
1.Have you ever been convicted of a
or crimeinvolvingmoralturpitude?
N
2. IfYES, explain thenature of the
ofconviction, and place of conviction:
City:
LocationInformation
Location 1:
PhysicalAddress
MailingAddress
Streeti
- 1
&
18B EST SMITH
6100 RED HOOK QUARTER
STE . B3- 3 &
B - 5
STE,
B - 3
City :
ST THOMAS
ST THOMAS
State:
State:
VI
Island
ST. THOMAS
Island
ST THOMAS
Country:
USVirginIslands
Country :
US Virgin Islands
Trade Name/DBA:
SOUTHERN TRUST COMPANY, INC.
1. Do you bave employee( s) at this location?
N
2. Explain in detail the type of proposed business activity for which the license(s)(has/have) been requested.
BUSINESS AND MANAGEMENT CONSULTING
License Information
TLicense Type Requested Start Date
Expire
Date
Status
Total
License Penalty
Fee
Fee
Amount
Location
[ Trade
Action
name
18A- 1,
- 1
&
18B
EST
SMITH STE
- 3
& B - 5 , ST
THOMAS,VI,00802
Business&
Renew
ManagementLicense
12/01/ 2017 12/ 31/ 2018 Expired
0.00
0. 00
0 .00
https://secure.dlca.vi.gov/UVDLA /Asps/ProcessApp/AppViewPrint.aspx ?licno =RdNvmE
8 20/2019
GOVERNMENT OF
THE VIRGIN ISLANDSOF THE UNITED STATES
CHARLOTTE AMALIE , ST. THOMAS, VI 00802
To Whom
These Presents Shall Come:
I the undersigned.LIEUTENANTGOVERNOR, dohereby certify that
FINANCIAL INFOMATICS, INC.
a Virgin Islands corporation , filed in the Office of the Lieutenant Governor on
September 21, 2012 as provided for by law , Certificate ofAmendment Articles of
Incorporation , duly acknowledged
changing its name to
SOUTHERN TRUST COMPANY, INC.
WHEREFORE the said Amendment is hereby declared to have been duly recorded in
this office on the aforesaid and to be in full force and effect from
that date.
Witness
my
hand
and
the
seal of
the
Govemment
of
the
United
Virgin
Islands at Charlotte Amalie
this 31 day of
October, A . D . 2012.
GREGORY R . FRANCIS
LieutenantGovernor of the Virgin Islands
Financial Trust Company, Inc.
EIN
# 66-0567418
BALANCE SHEET
December 31, 1999
CORPORATIONS
2000
JUN
30
1
A
:
LT.
GOV.
OFFICE
RECEIVED
ASSETS
$
24,472,690
LIABILITIES
898,779
STOCKHOLDER' S EQUITY
Common Stock and Paid in Capital
Retained earnings
300,000
23,273,911
23,573,911
LIABILITIES AND STOCKHOLDER' S EQUITY
$
24, 472,690
STATEMENTOF INCOME
Year Ended December 31, 1999
REVENUES
$
43,965,458
EXPENSES
264, 268
NET INCOME
$
43,701, 190
STATEMENT OF CHANGES IN RETAINED EARNINGS
Year Ended December31, 1999
BEGINNING RETAINED EARNINGS
NET INCOME
,701, 190
DIVIDENDDISTRIBUTIONS
(20,427, 279)
ENDING RETAINED EARNINGS
23, 273, 911
FinancialTrustCompany, Inc
EIN
# 66-0567418
BALANCE SHEET
December31, 2000
CASH
$
83,682 149
INVESTMENTS
101
,
FIXED ASSETS
555 875
OTHER ASSETS
1,090,097
TOTAL ASSETS
$ 186, 971, 432
ACCOUNTS PAYABLE
90 , 101
OTHERLIABILITIES
2,862,561
2,952,662
STOCKHOLDER' S EQUITY
Common Stock and Paid-
-
Retained earnings
88 , 279,478
95 , 739,292
184,018,770
TOTAL LIABILITIESAND STOCKHOLDER' S EQUITY
$
,
,432
STATEMENTOF INCOME AND RETAINEDEARNINGS
Year EndedDecember 31, 2000
InvestmentIncome
$
30 , 746,043
Fee Income
44,
,405
Total revenues
75,042,448
General and administrative expenses
1, 271, 258
Investmentexpenses
1, 305,809
Total expenses
2 ,577 ,067
NET INCOME
72,465,381
BEGINNINGRETAINEDEARNINGS
23, 273,911
ENDING RETAINED EARNINGS
$
95 ,739, 292
FINANCIAL TRUST COMPANY, INC .
EIN # 66-0567418
BALANCE SHEET
December31, 2001
RECEIVED
CASH
$
46,968,234
JUN 27 A 10: 59
CORPCRATIONS
INVESTMENTS
179,004, 937
FIXED ASSETS
437, 151
OTHER ASSETS
114 013
TOTAL ASSETS
226 ,524,334
20 460
ACCOUNTS PAYABLE
OTHER LIABILITIES
1,534,007
1,554, 467
STOCKHOLDER ' S EQUITY
Common stock and paid in capital
Retainedearnings
66 ,827,613
158, 142,255
224, 969,868
TOTAL LIABILITIES AND STOCKHOLDER ' S EQUITY
$
226 ,524, 334
STATEMENT OF INCOME AND RETAINED EARNINGS
Year endedDecember31, 2001
Investmentincome
20,995, 777
Fee income
46 842 ,367
Total revenues
67,838, 144
General and administrative expenses
1649,037
Investmentexpenses
3 ,786 , 144
Totalexpenses
5 ,435, 181
NET INCOME
62, 402, 963
BEGINNING RETAINED EARNINGS
95 ,739, 292
ENDING RETAINED EARNINGS
$
158, 142, 255
FINANCIAL TRUST COMPANY, INC.
EIN #
- 0567418
BALANCESHEET
December31 2003
CORPORATIONS
2004
30
LT.
GOV.
RECEIVED
CASH AND CASH EQUIVALENTS
INVESTMENTS
335,
FIXED ASSETS
357, 117
OTHER ASSETS
75 899
TOTAL ASSETS
$
646,418
ACCOUNTSPAYABLE
8, 906
LIABILITIES ON SECURITIES SOLD NOT YET PURCHASED
554 489
TOTAL LIABILITIES
563, 395
STOCKHOLDERS EQUITY
Common stock and paid
in capital
Retained earnings
28,797 ,888
366 ,285,135
395,083,023
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY
$
395 ,646 ,418
STATEMENT OF INCOME AND RETAINED EARNINGS
Year ended December 31, 2003
Fee income
58, 954,
Investment income
34 282,912
Totalrevenues
93, 237, 765
Investmentexpenses
1,480 ,406
General and administrative expenses
1, 806 ,023
Total expenses
3,286,429
NETINCOME
951, 336
BEGINNING RETAINED EARNINGS
276, 333,799
ENDINGRETAINEDEARNINGS
366,285, 135
FINANCIAL TRUST COMPANY, INC.
EIN # 66- 0567418
BALANCESHEET
December31, 2004
CASH AND CASH EQUIVALENTS
157,181,657
INVESTMENTS
405, 285,955
FIXED ASSETS
363,332
OTHER ASSETS
383,762
TOTAL ASSETS
563, 214 706
ACCOUNTS PAYABLE
9,753
LIABILITIESON SECURITIES SOLD NOT YETPURCHASED
75,726 ,397
LIABILITIES ON REPURCHASE AGREEMENTS
11,978,000
TOTALLIABILITIES
87 714 , 150
STOCKHOLDER' S EQUITY
Common stock and paid in capital
Retalned earnings
,
474,735 ,748
500 556
TOTALLIABILITIESAND STOCKHOLDER' S EQUITY
STATEMENTOF INCOME AND RETAINED EARNINGS
Year ended December 31, 2004
39
FeeIncome
104,052
InvestmentIncome
73,581, 555
Totalrevenues
126,685,607
Investmentexpenses
16,018,008
General and
expenses
2,216,986
Totalexpenses
234,994
NET INCOME
108,450,613
BEGINNING RETAINED EARNINGS
366, 285, 135
ENDING RETAINED EARNINGS
474 , 735,748
Fax
from
05 - 14-
11 26
Pg
3
FINANCIAL TRUST COMPANY, INC
EIN
#
0567418
BALANCE SHEET
December 31, 2006
CASH
CASHEQUIVALENTS
24 682 396
RECEIVABLES
55,225
INVESTMENTS
473416,997
FIXED ASSETS
310 , 207
OTHER ASSETS
11, 099
TOTALASSETS
509,684,
ACCOUNTS PAYABLE
LIABILITIES ON SECURITIES SOLD NOTYET PURCHASED
33, 788 422
DUE TO BROKER
43,404
33,832,781
TOTAL LIABILITIES
STOCKHOLDER ' S EQUITY
Common stock and pald
Ratained earnings
47
000
731,
.
TOTAL LIABILITIESAND STOCKHOLDER' S EQUITY
STATEMENT OF INCOME AND RETAINED EARNINGS
Year endedDecember31, 2005
30 ,879,
Investment Income
Total
87,734.
Investment
42,
Generaland administrative expenses
2 . 149,
Total expenses
44,
NET INCOME
43 481,262
BEGINNING RETAINED EARNINGS
474,735,
Less: DISTRIBUTIONS
43
.000
ENDING RETAINED EARNINGS
474 967,000
FINANCIAL TRUST COMPANY, INC.
EIN
# 66-0567418
BALANCE SHEET
December 31, 2006
CASH AND CASH EQUIVALENTS
55,700 201
RECEIVABLES
72, 092
INVESTMENTS
303,000,394
INVESTMENT
IN
SUBSIDIARY
117,
FIXED ASSETS
316,672
OTHER ASSETS
TOTAL ASSETS
11,050, 034
487 , 207
ACCOUNTS PAYABLE
2 434
LIABILITIES ON SECURITIES SOLD NOT YETPURCHASED
11.184 465
DUE TO BROKER
43,404
STOCK SUBSCRIPTION PAYABLE
1, 000
TOTAL LIABILITIES
11231, 303
STOCKHOLDER' S EQUITY
Commonstock and paid
Retained
475,
165
475.975,973
TOTAL LIABILITIES AND STOCKHOLDER 'S EQUITY
.
487 207, 276
RECEIVEL
STATEMENT OF INCOME AND RETAINED EARNINGS
Year endedDecember31 2006
Fee
65 , 984, 969
Investment income
8 051, 002
Totalrevenues
74 035 , 971
Investmentexpenses
1 ,954, 568
General and administrative expenses
1,337,238
Total expenses
3, 291,806
NETINCOME
BEGINNING RETAINED EARNINGS
70,744 165
474,
, 000
Less: DISTRIBUTIONS
70,500,000
ENDING RETAINEDEARNINGS
475,211 165
FINANCIAL TRUST COMPANY, INC
EIN
#
66 -
BALANCE SHEET
December 31, 2007
CASH AND CASH EQUIVALENTS
4,732,504
INVESTMENTS
278,443,231
INVESTMENTIN SUBSIDIARY
133,395, 223
FIXED ASSETS
337,839
OTHERASSETS
59,671,409
TOTALASSETS
476,580, 206
ACCOUNTS PAYABLE
79
79
TOTAL LIABILITIES
79
STOCKHOLDER'S EQUITY
Common stock and pald
Retalned earnings
, 808
475 , 815, 319
476 ,580, 127
TOTAL LIABILITIESAND STOCKHOLDER' S EQUITY
476,580, 206
STATEMENT OF INCOMEAND RETAINED EARNINGS
Year ended December31, 2007
CORPORATIONS
LT.
RECEIVED
Fee Income
PA
Investment Income
Totalrevenues
475
Investmentexpenses
233,615
General and administrative expenses
1, 452, 706
Total expenses
1686 ,321
NET INCOME
49, 333 154
BEGINNINGRETAINEDEARNINGS
475, 211, 165
Less: DISTRIBUTIONS
,729,000
ENDING RETAINED EARNINGS
475,815 ,319
FINANCIAL TRUST COMPANY, INC.
EIN
#
66 -
BALANCESHEET
As ofDecember31,
CASH ANDCASH EQUIVALENTS
145 , 493 , 041
ACCOUNTSRECEIVABLE
5 040,548
RELATED INVESTMENTS
57,717 ,
INVESTMENT IN SUBSIDIARY
141, 165, 001
PAOPERTY AND EQUIPMENT, netofdepreclation
308, 736
OTHER ASSETS
, 495,336
TOTAL ASSETS
,220 , 131
ACCOUNTS PAYABLE
8 972
TOTAL LIABILITIES
8 , 972
STOCKHOLDER ' S EQUITY
Common stock andpaid
capital
Retainedearnings
764,808
363, 446, 350
364, 211, 159
TOTAL LIABILITIESAND STOCKHOLDER' S EQUITY
364, 220, 131
STATEMENTOF INCOMEAND RETAINED EARNINGS
For the year ended December
, 2008
CORPORATI0.
2009
JUN
2
Fee Income
$
RECEIVED
Relalated investmentincome
9,
,688
Other related losses
)
95,
, 771)
Totalrevenues
Investment expenses
3 ,440, 476
Generaland administrativeexpenses
1, 981,721
Totalexpenses
5 , 422, 197
NETLOSS
( 100,
,968)
RETAINEDEARNINGS, beginningof year
475 ,815, 319
Less: DISTAIBUTIONS
11,500, 000
RETAINED EARNINGS, end of year
363,446, 350
FINANCIAL TRUST COMPANY , INC.
EIN
# 66-0567418
BALANCE SHEET
As ofDecember31, 2009
CASH AND CASH EQUIVALENTS
134,328,728
ACCOUNTS RECEIVABLE
55, 417
RELATED INVESTMENTS
53,631,852
131,432881
INVESTMENTIN SUBSIDIARY
PROPERTY AND EQUIPMENT,net of depreclation
289,
OTHERASSETS
14, 495,
TOTAL ASSETS
334 ,234 043
ACCOUNTSPAYABLE
23, 400
TOTAL LIABILITIES
23, 400
STOCKHOLDER' S EQUITY
Common stock and paid
capital
Retained earnings
764, 808
333, 445,836
TOTAL LIABILITIESAND STOCKHOLDER'S EQUITY
334 234,043
STATEMENT OF INCOME AND RETAINED EARNINGS
For the year ended December31, 2009
Fee Income
000
(11,014,
)
Relalatedinvestmentlosses
Otherrelatedlosses
Totalrevenues
(10, 914,238)
Investmentexpenses
6,752
Generaland administrativeexpenses
1, 767, 524
Totalexpenses
1, 774,276
( 12,688,515 )
NETLOSS
AETAINED EARNINGS, beginningofyear
363,446, 350
: DISTRIBUTIONS
17,312,000
RETAINED EARNINGS, end ofyear
333,445 ,836
FINANCIALTRUSTCOMPANY, INC.
EIN
# 66 -
BALANCE SHEET
As of December 31, 2010
CASH AND CASH EQUIVALENTS
28 173, 321.80
ACCOUNTS RECEIVABLE
1,455,637. 30
RELATED INVESTMENTS
126 , 843,024
INVESTMENTIN SUBSIDIARY
114 453, 570
,673
PROPERTY AND EQUIPMENT net ofdepreclation
OTHEA ASSETS
3,889, 312
TOTAL ASSETS
275 155,539
ACCOUNTS PAYABLE
845
LIABILITIES ON SECURITIES SOLD NOT YET PURCHASED
920 , 000
TOTAL LIABILITIES
920, 845
STOCKHOLDER'S EQUITY
Common stock and paid
Retained earnings
764, 808
, 469, 886
274, 234,694
TOTAL LIABILITIES AND STOCKHOLDER' S EQUITY
275
539
STATEMENTOF INCOMEAND RETAINED EARNINGS
For the year ended December31, 2010
30
12
51
Feeincome
Relalated investmentlosses
000
008 043)
(17,908,043)
Totalrevenues
Investmentexpenses
5, 365, 105
Generaland administrativeexpenses
2 124,
Total expenses
7 489, 787
NET LOSS
(25, 397, 830)
RETAINEDEAANINGS, beginningofyear
333, 445,836
Less: DISTRIBUTIONS
34,578, 120
RETAINED EARNINGS, endof year
273, 469,886
FINANCIAL TRUSTCOMPANY, INC.
EIN #
BALANCE SHEET
As ofDecember 31, 2011
CASH AND CASH EQUIVALENTS
29,608,037
ACCOUNTSRECEIVABLE
3 ,743, 963
RELATED INVESTMENTS
109,811, 863
INVESTMENTIN SUBSIDIARY
97, 110,019
PROPERTY AND EQUIPMENT, netof depreciation
304, 946
OTHER ASSETS
4,095 ,397
TOTALASSETS
244 ,674, 225
ACCOUNTS PAYABLE
18 , 109
LIABILITIES ON SECURITIES SOLD NOT YET PURCHASED
441,517
TOTAL LIABILITIES
469,626
STOCKHOLDER'S EQUITY
Common stock and pald In
Retained earnings
764,808
243 ,449,791
244,214,599
TOTAL LIABILITIES AND STOCKHOLDER 'S EQUITY
244, 674, 225
STATEMENT OF INCOME AND RETAINED EARNINGS
Forthe year endedDecember31, 2011
Fee Income
RelalatedInvestmentlosses
100,000
(9,228,140)
(9
,140)
Totalrevenues
2012
21
Investment expenses
2
, 460
General and administrative expenses
Total expenses
3,441, 954
NETLOSS
(12, 570,094 )
RETAINED EARNINGS,
ofyear
273, 469,886
Less: DISTRIBUTIONS
17 ,450,000
RETAINED EARNINGS , end of year
243,449,791
FINANCIAL TRUST COMPANY , INC
#
BALANCE SHEET
As of December31, 2012
CASH AND CASH EQUIVALENTS
29,
,408
ACCOUNTSRECEIVABLE
RELATED INVESTMENTS
105,787,
INVESTMENT IN
SUBSIDIARY
72,
, 145
PROPERTYAND EQUIPMENT,
of
OTHER ASSETS
4,070
TOTAL ASSETS
211789480
ACCOUNTS PAYABLE
1, 230
LIABILITIES ON SECURITIES SOLD NOT YET PURCHASED
1,
, 226
1
,456
TOTAL LIABILITIES
STOCKHOLDEA 'S EQUITY
Common stock and pald
capltal
Retained earnings
764, 808
209, 760, 216
210, 525, 024
TOTALLIABILITIESAND STOCKHOLDER' S EQUITY
211,789
STATEMENTOF INCOMEANDAETAINEDEARNINGS
For the year ended December 31, 2012
Fee
2013
27
CORPORATIONS
LT.
GOV.
RelalatedInvestment
Total revenues
expenses
Generaland administrativeexpenses
1 658,
1
Total expenses
NET LOSS
(13,994,055)
RETAINEDEARNINGS, beginningofyear
243,
,791
DISTRIBUTIONS
,695,520
RETAINED EAANINGS,end of year
209,
216
Southern
Company, Ino
EIN
#
0779861
BALANCE SHEET
As of
31, 2012
CASH
1,000
TOTALASSETS
1,000
STOCKHOLDER' S EQUITY
Pald
capitalstock
Additionalpald
capital
Aocumulated
1,000
28 ,624
(27,624)
1,000
TOTAL LIABILITIESAND STOCKHOLDER' S EQUITY
1, 000
STATEMENTOF INCOMEAND RETAINEDEARNINGS
For the year ended December 31, 2012
2013
27
LT
GOV.
OFFICE
RECEIVED
Income
Total revenues
Generaland administrative expenses
28,624
Totalexpenses
28,624
NET LOSS
(28,624)
RETAINED EARNINGS,
ofyear
1,000
Accumulated deficit, end of year
( 27,
)
Southern TrustCompany, Inc
EIN # 66- 0779861
BALANCE SHEET
As of December31, 2013
CASH
43, 204,291
INVESTMENTS
6 , 128,668
INVESTMENT
IN SUBSIDIARY
149,176 ,706
FIXED ASSETS
36 ,
OTHER ASSETS
217
TOTAL ASSETS
$
198,546,562
ACCOUNTSPAYABLE
20 ,261
LIABILITIESON SECURITIES SOLD NOT YET PURCHASED
165,874
TOTAL LIABILITIES
186 . 136
STOCKHOLDER ' S EQUITY
in capitalstock
Additionalpaid in capital
Retainedearnings
1 000
140,632,627
57,726, 799
198, 360,426
TOTAL LIABILITIESAND STOCKHOLDER' S EQUITY
$
198,
,562
STATEMENTOF INCOMEAND RETAINEDEARNINGS
For the year ended December 31, 2013
Fee income
Relalated investmentlosses
51, 000,000
(
8, 572,
Incomefrom
subsidiary
Totalrevenues
59,523,732
Generaland administrative expenses
1, 769, 308
Totalexpenses
1, 769,308
NET INCOME
57,754 423
ACCUMULATED DEFICIT, beginning of year
(27, 624)
RETAINEDEARNINGS, endofyear
57,726,799
Southern TrustCompany, Inc
EIN
#
- 0779861
BALANCE SHEET
As of December 31, 2014
CASH
$
90,800,807
INVESTMENTS
7 ,795, 584
INVESTMENT IN SUBSIDIARY
242,629, 146
FIXED ASSETS
305,684
OTHERASSETS
14,841
TOTAL ASSETS
,546
062
ACCOUNTSPAYABLE
2,353
LIABILITIES ON SECURITIES SOLD NOT YET PURCHASED
TOTAL LIABILITIES
2 353
STOCKHOLDER' S EQUITY
in
stock
Additionalpaid in capital
Retained earnings
1,000
232, 135,641
109,407 068
341,
,709
TOTAL LIABILITIES AND STOCKHOLDER' S EQUITY
341,546 062
STATEMENT OF INCOME AND RETAINED EARNINGS
For the year endedDecember31, 2014
Feeincome
70 , 000, 000
investmentlosses
298,685
Incomefrom subsidiary
-15, 091, 964
Totalrevenues
55,206,721
Generaland administrative expenses
3,526,452
Totalexpenses
3,526 ,452
NET INCOME
51, 680, 269
RETAINEDEARNINGS,beginningof year
57,726, 799
RETAINEDEARNINGS, endofyear
109, 407 ,068
Southern TrustCompany, Inc.
EIN # 66 -0779861
BALANCE SHEET
As of December 31, 2015
CASH
113,987,756
27,490,266
INVESTMENTS
INVESTMENT IN SUBSIDIARY
248,546,705
FIXED ASSETS
488, 922
OTHER ASSETS
1 464, 841
TOTAL ASSETS
$
978,490
ACCOUNTS PAYABLE
19,573
TOTAL LIABILITIES
STOCKHOLDER
S EQUITY
Paid in capital'stock
Additionalpaid in capital
Retained earnings
1
232, 497 683
159,460, 234
391, 958,917
LT.
GOV.
OFFICE
RECEIVED
TOTAL LIABILITIESAND STOCKHOLDER'S EQUITY
391,978,
STATEMENT OF INCOME AND RETAINED EARNINGS
Forthe year ended December 31, 2015
Fee income
54,999,980
Relatedinvestmentlosses
968,581
Income from
subsidiary
5,895, 337
Totalrevenues
61, 863,898
Generaland administrative expenses
3, 949,981
Total expenses
3,949, 981
NET INCOME
57,913, 917
RETAINED EARNINGS, beginning of year
109,407, 068
Distributions
(7,860,752)
RETAINED EARNINGS, end of year
159.460 .234
Southern Trust Company, Inc.
EIN
# 66 -0779861
BALANCESHEET
AsofDecember31, 2016
CASH
19, 010 282
INVESTMENTS
76,609,526
INVESTMENT IN SUBSIDIARY
258,719, 383
FIXED ASSETS
, 062
OTHER ASSETS
5 ,033,118
TOTAL ASSETS
ACCOUNTS PAYABLE
C
2017
RECEIVED
TOTAL LIABILITIES
STOCKHOLDER' S EQUITY
Paid in capitalstock
Additionalpaid
capital
Retained earnings
1, 000
224 997 683
134, 569, 177
359,567 , 860
TOTAL LIABILITIESAND STOCKHOLDER' S EQUITY
$
359,580 , 371
STATEMENTOF INCOMEAND RETAINED EARNINGS
For the year ended December 31, 2016
Related investmentlosses
2 ,591,534
Incomefrom subsidiary
14,115,
Totalrevenues
16 ,707 228
Generalandadministrativeexpenses
3, 598,285
Total expenses
3 ,598, 285
NET INCOME
13, 108, 943
RETAINED EARNINGS, beginning of year
159, 460 234
Distributions
RETAINED EARNINGS, end ofyear
(38,000,000)
134,
177
Southern Trust Company, Inc.
EIN # 66 0779861
BALANCESHEET
AsofDecember31, 2017
CASH
40, 399, 078
INVESTMENTS
102,770,759
INVESTMENT IN
SUBSIDIARY
244, 153, 227
FIXED ASSETS
182,364
OTHER ASSETS
TOTALASSETS
3,753, 118
391, 258,547
ACCOUNTSPAYABLE
CORP
2, 100
LOAN PAYABLE
30, 500, 000
TOTAL LIABILITIES
RECEIVED
30, 502, 100
STOCKHOLDER' S EQUITY
Paid
stock
Additional paid In
Retained earnings
Merger
Accumulated
1,000
2, 248,643
183, 198 ,348
175, 308,455
360,756 ,446
TOTAL LIABILITIESAND STOCKHOLDER'S EQUITY
391, 258, 547
STATEMENT OF INCOMEAND RETAINED EARNINGS
For theyearended December31, 2017
FeeIncome
8,000,000
Related investment losses
9,544,836
Income from
subsidiary
25,744,256
Totalrevenues
43,289,092
Generaland administrative expenses
2 ,549,814
Total expenses
2 ,549,814
NETINCOME
40,739, 278
RETAINED EARNINGS,beginning of year
134,569, 177
RETAINEDEARNINGS, end ofyear
175, 308, 455
Southern Trust Company, Inc.
BALANCE SHEET
As of December 31, 2018
CASH
16, 275,818
INVESTMENTS
135,679,624
INVESTMENTIN SUBSIDIARY
211,827,058
FIXED ASSETS
278,093
OTHER ASSETS
TOTAL ASSETS
3 ,753,118
367,813,711
$
ACCOUNTS PAYABLE
15, 969
LOAN PAYABLE
20,500,000
TOTAL LIABILITIES
20,515, 969
STOCKHOLDER' S EQUITY
Paid in capitalstock
Additional paid In capital
Retained earnings
1,000
2,
,643
345,048,099
347,297,742
TOTAL LIABILITIESAND STOCKHOLDER' S EQUITY
367 ,813, 711
RECEIUSD
-SIT
Southern Trust Company,Inc.
STATEMENT OF INCOMEAND RETAINED EARNINGS
Fortheyear ended December31, 2018
Related investmentlosses
7, 180,258
Incomefrom subsidiary
18, 939,854
Total revenues
26 , 120,112
Generaland administrative expenses
7,279, 141
Totalexpenses
7, 279, 141
NET INCOME
18,840, 970
RETAINED EARNINGS,beginning of year
358 ,506, 045
Distributions
(32 298,917 )
RETAINED EARNINGS, end of year
345 ,048 ,099
RECEVEDLI
-
07
12 / 05/ 2019
12 : 16
# 048
P . 0537073
-PF
2018
Return of Private Foundation
or Section 4947(aX1 Trust Treated as Private Foundation
not enter social security numbers on this form
as itmay be made public .
Go to www .
.gov
for instructions and the latest Information
Open to
20
year beginning
2018
and ending
A
Employer identification number
:
ISLANDS FOUNDATION, INC
66 -0585379
)
number(see
SUITE # 101
340 -779- 2564
c
exemption application is
Initialreturn
Initialreturn of a former public charity
ID
Foreign organizations,check
. ...
Finalreturn
Amended return
Address change
Namechange
2 Foreign organizationsmeeting the 85 % test, check
here and
computation ..
.
H
Check lypeof organization
501(c (3) exemplprivate foundation
Section 4947(a)(1)nonexemptcharitable
other
private foundation
E
private foundation status was terminated
Fairmarket value of all assets at endofyear
Accountingmethod:
Accrual
undersection 507(
, check here.. . .
(from Part
( ), line 16)
Other (specify)
Ifthe
isin a 60
termination
613,679.
( )must be on cash basis.)
*
under
507(
,check here ... .
ofRevenue and
(
Disbursements
Expenses (The totalofamounts in
(a) Revenueand
(b )Netinvestment
(c) Adjustednet
for charitable
columns( ) (c), and (d)may not
expensesper boaks
income
income
purposes
necessarilyequalthe amounts in
(cash basis only)
column ( a) (see instructions).)
1
,
2
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isnotrequired to attach
3
on
..
8
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,
8, 755.
4
andtnteret
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.
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loss. . .
6 a
of
10 .
-24, 871
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all
.
.
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.
.
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Part , line 2)...
8
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9
modifications
10 a
less
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allowances . . .
b Less Cost of
. .
or
17
Other
altach schedude
241
Revenue
0 .
UREAUOF
IN
.
8 . 755
12
Total
Add lines
11....
-
ofofficers, directors,
14
Otheremployeesalariesandwages. . . . .
75
plans,
16 a Legalfees (
.
b Accountingtees (attach sch).
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17
. . . .
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i
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schedule) and depletion .
20
Cccupancy . .
27
Travel, conferences, and meelings
and publications
.. .. .. ..
23
expenses (attach
SEE STATEMENT 1
272, 431
Total
and
expenses.Add lines 13
272, 431.
25
,
.
.
25 000.
26
Total
anddisbursements
Addlines 24 and 25.
.. ..
297, 431.
27
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und
.
. . . . .
-
, 306
b Nert Investment
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...
BAA ForPaperwork Reduction Act Notice, see Instructions.
272, 431.
272, 431.
25 ,
297
431
8
8 , 755
12
Form 990 PF (2018)
See
Federal Supplemental
Information
attached
rrom
12 / 05 / 2019
12 : 29
# 048
P
.
2018
PAGE 1
FEDERAL SUPPLEMENTAL INFORMATION
J. EPSTEIN VIRGIN ISLANDS FOUNDATION INC
(ENHANCEDEDUCATION)
CLIENT VIRGINIS
66-0585379
01: 39PM
15 19
NOTE
TO
PAGE
1,
BOX
IN NOVEMBER 2019
THIRD PARTIES ADVISED
THE
TRUSTEES OF
JEVIF
THAT
THE
ENTITY ' S
NON - PROFIT STATUS HAD
BEEN REVOKED
THE
IRS
CONFIRMED
THAT
IRS
RECORDS REFLECT THAT
THE
ENTITY'
S NON - PROFIT STATUS HAD
BEEN
REVOKED .
JEVIF
AND
ITS
BOARD
OF
TRUSTEES WERE
UNAWARE
OF
THE
REVOCATION .
CONSISTENT WITH
ITS PRIOR HISTORY OF
TIMELY FILING
ITS
FORMS
990 - PF
FOR
EACH
OF
THE
YEARS OF ITS
OPERATION WITH
THE VIRGIN
ISLANDS BUREAU
OF
INTERNAL REVENUE
AND
TO MEET ITS STATUTORY
OBLIGATION
TO FILE
JEVIF
IS FILING
THE 2018
FORM
990 - PF
TIMELY WITH
THE
VIRGIN
ISLANDS
BUREAU
OF
INTERNAL REVENUE WHILE
IT COMPLETES ITS
INVESTIGATION
INTO
THE
STATUS
OF
JEVIF .
TO
THE BEST OF
THE
BOARD ' S
KNOWLEDGE
AND
SUBJECT
TO
THE
INFORMATION CONTAINED
IN
THIS
STATEMENT,
ALL OF
THE
INFORMATION CONTAINED
IN
THE
RETURN
IS
TRUE ,
CORRECT AND COMPLETE
AS
OF
THE DATE
FILING .
12
/ 05 / 2019
12 : 29
# 048
0
2018
FEDERAL STATEMENTS
J. EPSTEIN VIRGIN ISLANDSFOUNDATION
(ENHANCEDEDUCATION)
PAGE 1
66-0585379
CLIENT VIRGINIS
11/13/19
03: 36PM
STATEMENT 1
FORM 990-PF, PART I LINE 23
OTHER EXPENSES
( B ) NET
INVESTMENT
INCOME
(
ADJUSTED
NET INCOME
COMMUNICATIONS
CONSULTING EXPENSE
INSURANCE
TRAVEL
( A )
EXPENSES
PER BOOKS
99, 996
165, 000
614 .
6 , 821.
TOTAL
, 431.
(D )
CHARITABLE
PURPOSES
99, 996 .
165, 000
614
6, 821.
STATEMENT2
FORM 990-
, PART II, LINE 6
RECEIVABLESDUE FROMOFFICERS, DIRECTORS, TRUSTEES, ANDKEYEMPLOYEES
RECEIVABLES REPORTED SEPARATELY
BALANCE DUE
FAIR MARKET
BOOK
VALUE
VALUE
160, 000.
$
160, 000 .
TOTAL $
160, 000
160, 000
STATEMENT
3
FORM 990-PF, PART II, LINE
15
OTHER ASSETS
FAIR
MARKET
VALUE
BOOK VALUE
CELLO
TOTAL
165 676
STATEMENT
4
FORM 990 -PF ,PART VII- A , LINE
COPIES OF FORM 990-PF TO STATE OFFICIALS
THERE
IS NO STATE
TAX FILING REQUIREMENT .