All content of David Marchant

Offshore bankers plead guilty to fraud

March 31, 2003

A dentist and his accomplice who defrauded $1.2 million from clients of their Grenada-licensed offshore shell bank that was capitalized with just $300 have entered into plea agreements in the United States. Dr. Noel E. H. Tait and Douglas E. Castle each pleaded guilty to one count of wire fraud at the U. S. District Court for the Eastern District of Pennsylvania on March 14 and March 27, 2003, respectively.

MRM seeks protection at US Bankruptcy Court

February 28, 2003

Mutual Risk Management has filed a bankruptcy petition in the United States and is seeking an automatic stay of all of the legal proceedings that have been filed against it and a ban on new actions.

Former Harris Organization officer admits role in Millennium Fund scam

February 28, 2003

Bill Amos, a former officer with The Harris Organization financial services group of Panama, has pleaded guilty to one count of conspiracy to commit securities fraud in the United States. Amos, 49, whose full name is William Earl Amos Jr., admitted the charge last year and has already been sentenced, said a spokesman for the U. S. Attorney's Office in Alabama.

Lancer Offshore, suspends cash redemptions and sues New York Post

February 28, 2003

Lancer Offshore Inc., which is registered in the British Virgin Islands and listed on the Irish Stock Exchange, has brought a libel lawsuit against the New York Post - one month after notifying investors it was effectively suspending cash redemptions. The libel action was filed at New York State Supreme Court on February 14, 2003 after the Post published three negative articles about the Fund, which purports to have assets valued at $1 billion, and/or its principal, Michael Lauer.

Insider Talking: February 28, 2003

February 28, 2003

Christopher Stone, ex-Managing Director of now-defunct, Dominica-based Investors Bank and Trust Ltd. was released from custody in Belgium in February on bail of 125,000 Euros, said a source; A default judgment for $130 million was entered against Bahamas-registered Vavasseur Corp. at the U. S. District Court for the Western District of Virginia on February 21, 2003 for its part in an international Ponzi scheme; Grenada Supreme Court issued a $125 million judgment against Van Arthur Brink, a.k.a. Gilbert Allen Ziegler, former head of the First International Bank of Grenada; Allen Wheatley, former Financial Secretary of the British Virgin Islands, was sentenced to serve five months in prison on February 17 after being found guilty of corruption charges; Cayman Islands-based businessman Kenneth Dart has acquired a 5.7 per cent stake in financially crippled, Bermuda-based insurance firm Mutual Risk Management; British trader Sean Alexander Quinn, 36, was released from prison in Barbados on December 5, 2002 after pleading guilty to an amended charge of money laundering; Receivers for the fraudulently-operated asset planning group Merrill Scott & Associates have found $1.03 million of assets in the Cayman Islands; The Bahamas Ministry of Finance expects to receive a report on the status of the financially-troubled Bahamas International Securities Exchange in the first week of March, 2003; The number of companies incorporating in the Cayman Islands has steadily decreased over the last three years, according to a report by Cayman Net News based on information provided by the Registry General; Florida-based Briton Edward Myles Chism Jr., 63, was taken into custody in Florida on February 7, 2003 - one day after being criminally indicted on three counts of tax evasion at federal court in Miami; Bermuda may be about to lose its grip at the top of the offshore world; and The Irish Minister for Justice has applied to Ireland's High Court for an order directing the Cayman Islands branch of Ansbacher International to pay US$3.1 million to cover the costs of a long-running inquiry into corruption and tax evasion.

Global Prosperity founders and former judge accused of fraud

February 28, 2003

A civil complaint has been filed against a group that has made a fortune by persuading U. S. citizens they are legally not required to pay income tax and by promoting fraudulent get-rich-quick schemes at conferences in offshore centers such as Aruba, Bermuda and the Bahamas. Plaintiff David Wayne Starkey claims he followed the tax advice only to end up being sentenced to eight months in prison in August, 2000 for willful failure to file a return.

Former trader for Bahamas scam firm sued in United States

February 28, 2003

An unregulated commodities trader who was involved with a Bahamas-based offshore firm accused last year of fraud has had similar allegations brought against him in the United States Robert L. Schillaci is a defendant in a civil lawsuit filed at the U. S. District Court for the Northern District of Illinois on November 21, 2002.

Annuity & Life Re becomes penny stock, stops writing new business

February 28, 2003

Annuity & Life Re shares collapsed to penny stock status on February 25 - the days after the firm announced it had ceased writing new business and was expecting "significant losses" for the fourth quarter. Its shares closed at 76 cents, compared with $18 per share only seven months ago and $35 per share 11 months before that. The company went public in April, 1998 at $15 per share.

Hunt for Imperial Consolidated assets moves to the United States

February 28, 2003

The former Managing Director of Imperial Consolidated's offshore bank tried to remove its $500,000 security deposit with MasterCard International four months AFTER the bank went into provisional liquidation. That is an allegation contained in a petition filed at the U. S. Bankruptcy Court for the Southern District of New York on February 7, 2003 by Marcus Wide, Provisional Liquidator of Imperium Bank.

New Cash 4 Titles lawsuits filed against Bahamas firms

February 28, 2003

The Receiver of the Cash 4 Titles Ponzi scheme, which is estimated to have caused losses to investors of more than $300 million, has filed a lawsuit in the United States against three Bahamas-based firms. Leadenhall Bank and Trust Ltd., Axxess International Ltd. and Axxess International (Bahamas) Ltd. are defendants in an action filed at the U. S. District Court for the Northern District of Illinois on November 27, 2002.

Two more Grenada offshore bankers charged with fraud

February 28, 2003

Two principals of a Grenada-licensed offshore bank whose directors included a former Governor-General, an ex-Prime Minister and two Justices of the Peace have been criminally charged in the United States. Noel E. H. Tait, a former staff dentist with the Department of Corrections in Washington D. C., and Douglas E. Castle were each charged with one count of wire fraud on January 30, 2003 at the U. S. District Court for the Eastern District of Pennsylvania.

Whatever you do, don’t mention the $300 million fraud

February 28, 2003

OffshoreAlert has obtained details of yet another unregistered securities offering being carried out by former officers of the Imperial Consolidated Group, including ex-British policeman Gary Alexander Lyons. Anglo Canadian Securities Inc., which is based in Canada and the UK, is raising funds for a personal injury litigation product that is virtually identical to one previously offered by Imperial.

John Deuss firms sue Brek Energy and related parties

February 28, 2003

Eight days before it was due to make a minimum payment of $350,000 towards its 2002 purchase of an ecommerce company, a group controlled by Bermuda-based oil magnate John Deuss has sued the seller. Transworld Payment Solutions NV and First Curacao International Bank NV, which owns Bermuda Commercial Bank, filed a civil complaint at Bermuda Supreme Court on February 21, 2003.

Banc Caribe owner criticizes regulators

February 28, 2003

A part owner of the latest offshore bank to be closed down in Dominica has accused regulators of acting on incorrect information supplied by disgruntled management who had been fired only days before. "The government has made a dirty deal with the old management," said Ferdinand Hoischen, a German lawyer who beneficially owns Banc Caribe with Jonas Persson, of Sweden. "This is very political."

Dubious offshore insurer sued by unregulated ‘$9 billion’ US investment fund

February 28, 2003

An unregulated investment fund claiming to have $9 billion of assets but operated from a private residence in Florida is suing an offshore insurer based on an island that purports not to license such firms. Florida-registered Growth Fund Partnership Inc. is claiming breach of contract and fraud against Nevis-registered Condor Insurance Ltd. regarding a financing deal.

Cayman-based businessman takes stake in distressed Bermuda insurance firm

February 28, 2003

Cayman Islands-based businessman Kenneth B. Dart, whose family made a fortune in the Styrofoam cup business, has acquired a 5.7 per cent stake in financially crippled Mutual Risk Management. Dart's firm Ross Financial Corporation, which is domiciled in Cayman, has acquired 2,377,600 common shares, according to a Dart-signed document dated February 13, 2003 that was filed with the SEC.

ESG Re shares de-listed

February 28, 2003

ESG Re shares were not only de-listed from Nasdaq in February but also cannot be traded on the over-the-counter market because the firm is not current in its SEC filings. […]

George Wilson released from prison on a technicality

February 28, 2003

Bahamas-based businessman George L. J. Wilson has been released from prison in the United States on a technicality three years into a 20-year prison sentence after being convicted in 1999 of multiple counts of conspiracy to commit money laundering, money laundering, mail fraud, and engaging in monetary transactions involving property derived from specified unlawful activity, following a jury trial at the United States District Court for the Southern District of Texas.

Stirling Cooke accuses US firm of trying to steal subsidiary

January 31, 2003

A U. S.-based insurance manager has been accused of trying to "steal" an underwriting subsidiary of AlphaStar Insurance Group Ltd., previously known as Stirling Cooke Brown Holdings. American Insurance Managers Inc. entered into a "non-binding" agreement on October 2, 2002 to buy AlphaStar's New York-based underwriter Realm National Insurance, for $12 million.

Class action lawsuit against forex firm exposed by OffshoreAlert

January 31, 2003

A class action complaint has been filed against online currency trading firm GAIN Capital on behalf of at least 200 people allegedly defrauded out of $10 million in a forex scam first exposed in OffshoreAlert. GAIN Capital Inc., of New Jersey, is a defendant along with an independent broker, Sterling forex LLC, and Sterling forex's principal, Maurice Lewis Mills, both of Bellevue, Washington.

Goldman Sachs sells AlphaStar shares for one-third of market price

January 31, 2003

Goldman Sachs has sold its entire 22.9 per cent stake in AlphaStar Insurance, formerly Stirling Cooke, back to the company for five cents per share - about one third of its current trading price. Goldman was keen to sell so that its investment vehicles could take a write off before the end of the tax year and agreed to buy at a discount to avoid creating the appearance of self-dealing, AlphaStar's CEO, Stephen Crane, told InsideBermuda.

Jerome Schneider arraigned, posts $100,000 bond

January 31, 2003

Offshore bank broker and author Jerome Schneider has made his first court appearance in the United States since being criminally indicted on 23 counts of fraud on December 19, 2002. Schneider was arraigned at the U. S. District Court for the Northern District of California on January 30 and pleaded not guilty. He immediately posted a $100,000 corporate surety bond.

GenStar v. Platinum Indemnity lawsuit settled

January 31, 2003

A civil lawsuit filed by General Star Indemnity Company against Bank of America and Bermuda-based rent-a-captive Platinum Indemnity Ltd. has been settled. The settlement was registered with the United States District Court for the Southern District of New York on October 29, 2002.

Omnicorp Bank principals start new scheme

January 31, 2003

Following the collapse of their insolvent financial group in St. Vincent & the Grenadines amid suspicions of fraud, the principals of Omnicorp Bank and its affiliates are starting a new investment scheme based in Cyprus. The management is the same as Omnicorp's and includes Canadians Nelson Bayford, Lloyd Merrifield and Gary L. Moore, the latter of whom settled an SEC stock fraud lawsuit in 2000 by agreeing to disgorge $24,175.

Newt Utopia: What has happened in Cayman is beyond belief

January 31, 2003

As International Financial Service Providers (IFSPs), we are supposed to be the most educated and most sophisticated of the financial service providers in the world. We know more about insurance, banking, stocks, bonds and corporate structure than many guys at Goldman Sachs or Merrill Lynch. We assist our clients in dealing with capital that is leaving or will not see, at least for a while, the native soil of the client. This capital is called flight capital.

Insider Talking: January 31, 2003

January 31, 2003

In all of the hullabaloo surrounding the collapse of the Euro Bank trial in Cayman after the judge determined that the island's senior anti-money laundering officer, Brian Gibbs, had lied and destroyed evidence, it was easy to overlook a snippet in Gibbs' November 26, 2002 witness statement about Johnny Johnson; An order for the extradition of offshore banker William Cooper from Antigua to face a money laundering indictment in the United States was thrown out by a judge in Antigua on January 13, 2003 because the application was made before an extradition treaty between the two countries was ratified and before money laundering was criminalized on the Caribbean island; Edouardos Stamatiou, whose Argentina-based firm Tucuman Land Holdings Ltd. received £151 million ($237 million) of the $345 million defrauded from clients of the Imperial Consolidated Group and won't give it back, is a former principal of The Cayman Financial Brokerage House, which … surprise, surprise … was forcibly closed down in October, 1999; Another post-Imperial Consolidated scam, known as Property International, is in financial trouble after not very long in business; And, to conclude our segment on Imperial Consolidated, we have been passed the name of yet another company which allegedly brokered client funds into the fraudulently-operated group - Lighthouse Strategies; Canadian national David Voth has been fined CDN$12,000 in Canada for failing to file tax returns; Bahamas-based Suisse Security Bank & Trust, which is in provisional liquidation, has asked a U. S. judge to order two parties who unsuccessfully sued the bank in New York to place $1.3 million into court to cover its legal fees and damages; Trading on the over-the-counter market of shares in a company that Bermuda-based Lines Overseas Management was helping to do a reverse take-over of has been temporarily suspended pending an investigation by the Securities and Exchange Commission in the United States; and Famed U. S. attorney Johnnie Cochrane may be helping to broker a settlement in the long-running battle for control of the assets of Eurofed Bank in Antigua.

Terry Neal expects further charges, complains of treatment by US authorities

January 31, 2003

Offshore services provider Terry Neal, who has been criminally indicted in the United States for alleged tax evasion, said he expects to be charged with further offenses. "In court, the IRS was quite open about the fact that they hoped to amend the complaint with which they have charged me to include all kinds of nefarious acts, as yet unnamed," he told OffshoreAlert. "Of course, the real reason for the government's angst has much more to do with my critical writing regarding IRS abuse as set forth in numerous published newsletters, magazine articles and my several books."

SEC case against Kenneth Lagonia dismissed

January 31, 2003

An SEC lawsuit alleging fraud against Kenneth Lagonia, once listed as a director of DIAK Bank, which is licensed in Grenada but apparently based in St. Vincent, has been dismissed at the U. S. District Court for the Southern District of New York.

Lincoln Fraser staves off bankruptcy (for now)

January 31, 2003

Imperial Consolidated co-founder Lincoln Fraser has staved off personal bankruptcy - at least for the time being - after a commercial rent debt of £16,599 (US$26,600) was paid at the eleventh hour. A petition to have Fraser declared bankrupt was due to be heard at Grimsby County Court, England on January 20, 2003. It did not proceed after payment in full was made earlier in the month, said a spokesman for the petitioning creditor, Nadan Properties Ltd., of London.

Has anyone seen Steve Saemmler Klein?

January 31, 2003

Belize-based offshore provider Grupo CAT appears to have gone out of business following the disappearance of its principal, Steve Saemmler Klein. Over the last month, the group's telephone lines have been disconnected and several of its web-sites are no longer accessible.

Evergreen Trustee sues Bank of Butterfield, Lions Gate Management et al

January 31, 2003

Bermuda-based Bank of Butterfield and Bahamas-based offshore provider Lions Gate Management have been named as defendants in the latest wave of lawsuits filed by the Bankruptcy Trustee of Evergreen Security, an unlicensed mutual fund which defrauded its investors of over $200 million. Twenty-two new actions were filed at the U. S. Bankruptcy Court for the Middle District of Florida, in Orlando, on January 23, 2003 and four previously-dismissed lawsuits have been reopened, said Bankruptcy Trustee Bill Cuthill.

Client accuses European Federal Union Bank of fraud

January 31, 2003

A current scam being carried out in the name of European Federal Union Bank may be a successor to a similar fraud perpetrated by the British Bank of Trade & Commerce, a.k.a. British Bank of Commerce. The principals of both businesses are Costa Rica-based John W. Haas and Andover Garcia, according to a representative of clients claiming to have been defrauded of approximately $130,000 by EFUB.

On Her Majesty’s Not So Secret Service

January 31, 2003

Cayman's much-vaunted reputation for bank secrecy is in tatters after revelations that the island's senior anti-money laundering officer has been selling secrets to British intelligence since 1990. While Cayman was being promoted as a financial center where it was a criminal offense to reveal confidential information, Brian Gibbs was passing on virtually everything that came across his desk.

Cayman regulator warns against unlicensed ‘banks’

January 31, 2003

The Cayman Islands Monetary Authority has issued a warning about eight Internet 'banks' which are using Cayman addresses and/or telephone numbers even though they are not registered or licensed there. Research by OffshoreAlert indicated that six of the eight sites have links to Nigeria, where fraud is a major industry, while the principals of the other two have ties to Singapore and the UK.

Bank of Butterfield sued for $115 million by Evergreen Security Bankruptcy Trustee

January 31, 2003

Bermuda-based Bank of Butterfield is being sued for $115 million by the by the Bankruptcy Trustee of Evergreen Security, an unlicensed mutual fund which defrauded its investors of over $200 million. The Bank is being sued in its capacity as a custodian for Evergreen, as is Bear Stearns, which is a defendant in a separate action.

SEC investigates LOM business partner

January 31, 2003

Trading on the over-the-counter market of shares in a company that Bermuda-based Lines Overseas Management was helping to do a reverse take-over of has been temporarily suspended pending an investigation by the Securities & Exchange Commission in the United States.

KPMG (TCI) sued by Atlas Financial Group clients

January 31, 2003

A civil complaint has been filed in the United States against failed Turks & Caicos Islands-based Atlas Financial Group, its auditor, KPMG, and several current or former officers. Among the defendants are the Managing Director of KPMG (TCI), Gary Brough, 40, who is British; and the accounting firm's former Director of Corporate Finance,Robert Gass, 38, who is Canadian. AFG founders Wayne Turner and his son, Scott Turner, who are both Canadian nationals, are also defendants.

ARM Trust principal accused of fraud by SEC

January 31, 2003

A United States-based businessman set about cheating people he had defrauded once before while he was awaiting sentencing for the first crime, according to an SEC lawsuit. Frank Ray Johnson was convicted of fraud in 1999 after more than 9,000 investors were cheated out of millions of dollars in a scheme known as International Benevolent Fund Trust.

FTC clamps down on firms offering bogus driving permits

January 31, 2003

The Federal Trade Commission in the United States has filed six lawsuits at Federal courts against businesses that have been selling bogus "international driver's permits" over the Internet. "The defendants deceptively marketed bogus products," said John Beales III, Director of the FTC's Bureau of Consumer Protection.

Missed filing deadline costs Harris chance to challenge conviction

January 31, 2004

An attempt by offshore provider Marc Harris to overturn his conviction for money laundering and tax evasion has failed because of an apparent blunder by his attorneys. On January 23, 2004, U. S. District Judge James Cohn threw out Harris' motion for a Judgment of Acquittal because it was filed after the statutory deadline for post trial motions had expired.

Offshore investors accuse fund manager of swindling them

December 31, 2002

Investment vehicles registered in Bermuda, the Isle of Man and Delaware claim to have been cheated out of more than $9.5 million by the manager of an investment fund.The culprit was Sloane Robinson Investment (Cayman) Ltd., which was the General Partner and Manager of the S. R. Global International Fund L. P., according to a civil lawsuit.

Suncor Energy joins sEnergy Insurance

December 31, 2002

Canada-based Suncor Energy is to become a member of Bermuda-registered sEnergy Insurance Ltd., effective January 1, 2003.sEnergy was established in Bermuda in May, 2002 to provide large limits of coverage for business interruption and excess physical damage insurance.

Greatest deficit of reinsurance capacity since 1992, says Bermuda boss

December 31, 2002

Despite $25 billion of new capital, there currently exists "the greatest deficit of reinsurance capacity since 1992", according to Patrick Thiele, President and CEO of Bermuda-based PartnerRe.

Stirling Cooke sues American Insurance Managers, et al

December 31, 2002

Stirling Cooke North American Holdings Inc., AlphaStar Insurance Group Ltd. and Realm National Insurance Company filed a civil lawsuit at the U. S. District Court for the Southern District of New York on December 27, 2002 alleging breach of contract against American Insurance Managers Inc., American Insurance Management Group Inc. and Atlanta Insurance Marketing Inc.

Terry Dowdell pleads guilty to fraud

December 31, 2002

A business associate of the now-closed Overseas Development Bank & Trust Ltd., of Dominica, has pleaded guilty to 20 felony charges, including securities fraud, money laundering and wire fraud.The charges relate to a multi-million dollar fraudulent trading program that Terry L. Dowdell operated through his Bahamas-registered firm, Vavasseur Corporation, starting in 1998.

US indicts Jerome Schneider and Eric Witmeyer

December 31, 2002

Offshore promoter Jerome Schneider and his alleged business partner, Eric J. Witmeyer, are expected to be arraigned next week after they were criminally indicted in the United States.Although they were indicted on December 19, 2002, neither was required to put in a court appearance by year-end, which prosecutors said was due to the difficulties of the Holiday season.

Terry Neal arrested on suspicion of tax evasion

December 31, 2002

Offshore services provider and asset protection author Terry Leroy Neal has been arrested and jailed in Oregon after a criminal complaint accused him of making false statements in his personal tax returns filed with the IRS.Neal was arrested on December 27, 2002—one day after a criminal complaint was filed against him at the United States District Court for the District of Oregon, in Portland, which is Neal's home-town.

Endurance Specialty announces $200 million IPO

December 31, 2002

Almost 12 months to the day after it began operations, Bermuda-based Endurance Specialty Holdings Ltd. filed a registration statement with the SEC to raise up to $200 million in an initial public offering.Endurance Specialty, which provides property and casualty insurance and reinsurance, intends to list on the New York Stock Exchange under the ticker 'ENH'.

Sham business that plagiarized Bayshore Bank web-site goes off-line after OffshoreAlert inquiry

December 31, 2002

The web-site of a sham bank purporting to be based in the Cayman Islands was taken down in December within 24 hours of OffshoreAlert emailing questions to the operators asking about their business.Citi Finance Corporation had set up a web-site at www.citifinancecorp.com whose design and content had clearly been plagiarized from an unrelated, bona fide bank, Bayshore Bank & Trust, of Barbados.

Carolina Re insiders sued over $485 m dividend payouts

December 31, 2002

The Joint Liquidators of Bermuda-registered Carolina Reinsurance Ltd. have filed a civil lawsuit in the United States against the firm's shareholders and auditor.They are seeking damages for tens of millions of dollars of dividends they claim were taken out of the company when it was insolvent.