Bank of Bermuda takes $10 m charge
The Bank of Bermuda has taken a $10 million charge in its latest quarterly results to reflect the collapse of its investment in e-commerce firm, First Ecom.com.
FIBG crook Van Brink marries young woman in Uganda
American conman Van A. Brink, the founding chairman and CEO of the First International Bank of Grenada, recently married a considerably younger local woman in Uganda, where he fled just before FIBG collapsed in 2000 with an estimated $150 million stolen from depositors.
Cayman hillbillies try to curb freedom of speech
Heads are rolling in the Cayman Islands after another comical attempt to curb freedom of speech on the island.OffshoreAlert has been told that several Immigration Board members are facing the chop after a letter was sent to expatriate Gordon Barlow threatening to take away his Permanent Residency because he was writing letters to the editor of the Caymanian Compass and making other public comments deemed to be undesirable.
Lawsuit pits ‘Unity-States’ against United States
The battle between the US authorities and a group of suspected fraudsters allegedly led by American John Wayne Zidar, whose scheme was heavily promoted in Bermuda, becomes more bizarre by the month.On November 30, 2000, an action was filed in the US District Court for the Central District of California on behalf of something calling itself the 'Unity-States' against several parties, including the United States, the FBI, the SEC, the US Marshals Service, judges in the US and Western Samoa, the Western Samoan Attorney General, several banks and others, including Zidar himself.
Lawsuit filed by victims of Antigua-based Accord group
A civil lawsuit has been filed in the United States against Antigua-based Accord Trading Ltd., which was run by Britons Leslie Wingham and Graham Carr.Plaintiff Milton Shoong Corporation claims that it lost $1.2 million with Accord after being promised monthly returns of 100 per cent per month for ten months, according to its complaint.
Suisse Security Bank & Trust has $4.5M frozen & seized
Bahamas-based Suisse Security Bank & Trust is fighting two lawsuits in the United States which have resulted in $1.47 million of its assets being seized and another $3 million frozen. The bank is currently waiting for the outcome of an appeal against a default judgment in Florida in 1998 which will determine whether the seized $1.47 million has been lost forever.
APAM settles lawsuit prior to AFC Re sale
Florida-based Atlantic Portfolio & Analytics Management settled a lawsuit in the United States prior to selling Bermuda-registered AFC Re in December, 2000 to avoid "further litigation costs".
Unregistered offering in the name of Bahamas mail-drop firm
Bahamas-based A.S.A.P. Services Ltd., which provides mail-drop and 'virtual office' services, is conducting an unregistered share offering that values the four-year-old firm at $45 million.Investors are being solicited to invest in a "pre-IPO" offering of five million shares - said to represent 11 per cent of the firm's common stock - at $1 per share.
FIBG put into liquidation, founder weds Ugandan woman half his age
A petition to wind-up the First International Bank of Grenada was filed by the Grenada government on January 12, with PricewaterhouseCoopers appointed as liquidator.
In the petition, the government announced that US$206 million of clients' principal went into FIBG and that an additional US$266 million of interest is owed to creditors.
Insider Talking: January 31, 2001
David Voth unable to name auditor of The Forex Fund, Dennis Sutton charged with fraud and forgery in the Bahamas, fraudulent GTrade 'stock exchange' becomes active again after months of inactivity, conman Joseph Becker sets up his own European Community in cyberspace, FIBG-related barrister Lawrence Jones stops practicing law in England.
Offshore Alert editor to be featured on CBS News’ 48 Hours
CBS News' television program '48 Hours', which is hosted by Dan Rather and averages approximately 11 million viewers per show, has filmed Offshore Alert's editor, David Marchant, for a television program on Cybercrime that is due to be aired on the evening of Thursday, January 25, 2001.
Spanish newspaper reveals Imperial Consolidated’s relationship with arms dealer
The Spanish newspaper El Mundo published several articles yesterday and today about a business relationship (turned sour) between the Imperial Consolidated Group, which has offices in the UK, the Bahamas, Grenada and other countries, and Monzer al-Kassar, a Syrian national who has been described in various media articles over the years as one of the world's largest arms dealers and whose clients, according to El Mundo, include suspected terrorist Osama Bin Laden, whom the US believes was involved with the World Trade Center bombing.
TCI regulator: Harris Organization investment trust not registered here
Offshore Alert has uncovered another dubious investment fund being promoted by The Harris Organization financial services group of Panama.
The objective of the Washington Pacific Investment Fund is "to achieve a rate of return of 100% per annum" by investing in "mortgage backed securities and liens", according to a prospectus.
Leslie Wingham asks victims for more money, tells them to stop calling his attorney
British businessman Leslie Wingham has asked victims of an alleged multi-million fraud that he operated in Antigua for additional money to fund a so-called recovery effort.
In a letter to "Investors and Agents of Accord Trading/Accord Insurance and EMRW" dated November 27, 2000, Wingham asked for at least $1,000 each from his victims.
Robin Cotterell: ‘US investigators wanted me to give up my clients’
Nevis-based offshore provider Robin Cotterell claims that US investigators asked him to disclose confidential information on his firm's clients in return for leniency on money laundering charges.
Details of a failed attempt to persuade Cotterell to break Nevis' confidentiality laws are contained in a statement issued on his behalf following his acquittal on November 28, 2000.
First Ecom.com share price falls below $1, jeopardizes NASDAQ listing
Electronic credit card processing firm First Ecom.com, whose plight was highlighted in the previous edition of Offshore Alert, officially became a penny stock during December.
On December 27, 2000, the company's share price fell to just 59 cents on the full NASDAQ system, compared with a high of $34 on the over-the-counter market just ten months earlier.
David Voth client alleges $50,000 loss, links to unlicensed Bahamas fund
A Canadian businessman who offers unlicensed investment products and services through Bahamas-registered IBCs is under fire from a client who lost $50,000 in suspicious circumstances.
David M. Voth's group received funds from Bahamas-registered Geebung Corporation in December, 1998 for investment in a scheme that offered a 25 per cent return per quarter for 12 months.
BVI-domiciled Kading Companies SA agrees to SEC Cease and Desist Order
A British Virgin Islands-domiciled company and its President have agreed to a Cease and Desist Order and a civil penalty following an administrative proceeding brought by the SEC.
Kading Companies S.A. and Kevin H. Kading, 42, were among four Respondents accused of acting as broker-dealers in the United States without being registered by the SEC. The other Respondents were Utah-registered Joning Corp. (f.k.a. Global Stock Exchange Corp.), which was 55 per cent-owned by Kading Corp; and John O. Jones Jr., 54, Joning's President.
British Trade & Commerce Bank’s claim of frozen assets not true, says adversary
A claim by Dominica-based British Trade & Commerce Bank that its liquidity problem is substantially due to having its assets frozen by a Canadian court is in dispute.
The Plaintiffs in the only known lawsuit against BTCB in Canada told Offshore Alert that no assets have been frozen as a result of the action, which contradicts BTCB's public stance.
Everest Re buys secretive Bermuda reinsurer AFC Re
One of the most secretive commercial reinsurers in Bermuda has been sold after three years in business, about two-thirds of which it appears to have been up for sale.
AFC Re, which was capitalized at $100 million when it formed in October, 1997, was bought for $17 million in cash by Everest Re (Bermuda) in a deal that was announced on December 22, 2000.
ACE sues CIGNA for $170 million, alleges accounting and tax errors
ACE Ltd. filed a civil complaint against CIGNA on December 11, 2000 alleging breach of contract stemming from its $3.45 billion acquisition of CIGNA's property and casualty business in July, 1999.
ACE is seeking compensatory damages of $218 million, comprising $170 million in alleged over-valuation of the acquired business and $48 million under a Tax Sharing Agreement. ACE is also asking for a declaration that it is not liable to CIGNA for any additional tax liabilities.
International Risk Management Group split up between Aon and management
Three months after being officially denied to Inside Bermuda, it was announced on December 7 that Aon had bought the global captive management and risk finance consulting operations of the International Risk Management Group.
The rest of IRMG, i.e. its property loss control consulting business, Global Risk Consultants Corp., is being sold to existing senior management in a Management Buy Out.
Director of DIAK Bank is defendant in SEC lawsuit
A director of Grenada-registered DIAK Bank is currently fighting a civil lawsuit in which he is accused of participating in an investment fraud relating to a previous venture, we can disclose.
Kenneth Lagonia was one of several defendants in a lawsuit filed by the Securities & Exchange Commission on April 14, 1998 at the US District Court for the Southern District of New York.
Terry Neal lawsuit concludes with settlement by last defendant
The civil fraud lawsuit filed by the SEC against Nevis-based offshore provider Terry Neal and five others ended on December 15 when the last defendant settled.
Michael T. Baer was ordered by the U. S. District Court for the District of Oregon to disgorge $1.4 million in "ill-gotten gains" and barred from serving as an officer or director of a public company. The disgorgement was waived and no civil penalty was imposed "based on his demonstrated financial condition".
FIBG client Teddy Wayne Solomon sentenced to 24 years in prison
A client of the First International Bank of Grenada, Teddy Wayne Solomon, has been sentenced to 293 months in prison after a jury in Texas found him guilty on multiple charges of fraud and swindling.
Solomon was also fined $150,000 and ordered to pay restitution of $2.4 million when he was sentenced on October 20, 2000 at the US District Court for the Northern District of Texas.
Galanis, Ernst & Young (Bahamas) sued for alleged investment fraud
Ernst & Young (Bahamas), its former Managing Partner, Philip Galanis; and a current partner, Paul Clarke, are being sued in the United States for their role in an alleged $9.95 million investment fraud.
The complaint, which was filed on November 30, 2000 at the U. S. District Court for the District of Arizona, relates to the same events that led to Galanis being fired from Ernst & Young in 1997.
Newt Utopia: Offshore Internet Books and Casinos
Dominica, Costa Rica, St. Kitts, Isla Margarita, Belize, and Fulfillment Issues.
Break out the vodka: MRM buys Valmet Group
Mutual Risk Management is due to complete the purchase of Bermuda-registered financial services firm Valmet Group by January 2, 2001.
In acquiring Valmet, MRM is taking over an entity that has received much international publicity over the last few years due to its ties with Russia.
Michael Berger awaits sentence after pleading guilty to securities fraud
Hedge fund manager Michael Berger, who lost approximately $400 million of investor money in the BVI-registered Manhattan Investment Fund, is due to be sentenced on March 16, 2001 after pleading guilty to one charge of securities fraud.
Insider Talking: December 31, 2000
During the course of 2000, Offshore Alert received many telephone calls and e-mails from clients of The Harris Organization financial services group in Panama who claimed to have been defrauded of various amounts of money; After Tony Vigna was recently deported from Panama to face criminal charges in Miami, further details emerged of a fake British passport that was obtained for him by The Harris Organization when he fled the US before being indicted; Standard Hellier Bank and Allianz Trade Reinsurance web-sites become inactive after investigation by Offshore Alert; We have been told by the Grenada Supreme Court that between 10 and 15 civil lawsuits have now been filed against the First International Bank of Grenada group; The default judgment entered against the Bank of Bermuda in favor of the Receiver of the Cash 4 Titles alleged Ponzi scheme at a US federal court on November 20, 2000 was set aside ten days later; Clyde DHood, the small-town electrician in Illinois who persuaded thousands of suckers all over the world to mail him millions of dollars just by promising high returns, remains in jail after his bail application was turned down; Canadian crook Jordan Bionda seems to subscribe to the philosophy that 'the best form of defense is attack'; and Americans are regarded virtually all over the world as being parochial in that they tend not to travel abroad, generally know little about other countries or world affairs and, rather insultingly to the rest of the world's population, give themselves titles such as 'World Champions' when they win a national championship, be it in basketball, baseball, American football or whatever.
Bahamas firms terminate Imperial Consolidated’s HINT MasterCard
The UK-based Imperial Consolidated Group has suffered another blow with the forced termination of its HINT MasterCard offshore credit card program, which was operated from the Bahamas.
Leadenhall Bank & Trust, which issued the card, and Axxess International, which administered it, withdrew their support in November due to concerns over Imperial Consolidated's credibility.
Bank Crozier licensed in St. Lucia, plans to move HQ from Grenada
Grenada's oldest offshore bank, Bank Crozier, is moving its headquarters to St. Lucia, where it has become the first bank to be licensed under the International Banks Act 1999.
The Swedish-owned bank, which began operations in Grenada in 1997, expects to complete the move in the New Year.
Mutual Risk to buy Valmet Group
Mutual Risk Management, whose share price has been in the doldrums for several months on the New York Stock Exchange (Ticker - 'MM'), is in the process of completing the purchase of the Valmet Group, a financial services group with operations in eight different locations.
Imperial’s HINT MasterCard terminated by Bahamas bank
The Bahamas-based HINT MasterCard credit card program that was offered by the Imperial Consolidated Group has been terminated by the issuing bank, Leadenhall Bank & Trust, and the data processor, Axxess International, which are both based in the Bahamas. In other news, Brent Wagman has been sentenced to five years in prison in Texas and fined $19.7 million for investment fraud.
Reward for speculators in Bank of Bermuda stock
Investors who bought Bank of Bermuda stock recently in anticipation of a favorable government decision that would allow its shares to be listed on an overseas stock exchange have been rewarded.On December 8, 2000, Bermuda Minister of Finance Eugene Cox publicly disclosed that the bank, which is generally considered to be the biggest offshore bank, had been given an exemption from the law that prohibits foreign ownership of local companies to exceed 40 per cent.
Offshore criminal activity continues unabated in Grenada
Regulators in Grenada are continuing to allow banks belonging to the First International Bank of Grenada group to operate on the island despite FIBG's massive insolvency, we can reveal.
The National Commercial Bank of St. Vincent, which is government-owned, is also continuing to provide banking services despite having its UK assets frozen recently over the FIBG fiasco.
Offshore firms sued after family trust was alleged defrauded
Some of the biggest names in offshore finance have been named as defendants in a civil lawsuit filed in the United States by investors who claim to have been defrauded of $5 million.
Defendants are Matheson Trustees (BVI) Limited, Matheson Trust Company (BVI) Limited, Bank of Bermuda, Credit Suisse, of Switzerland; UBS, of Switzerland; and KPMG, of the British Virgin Islands.
Offshore shareholders face huge losses after First Ecom share price collapses
A publicly-traded company whose principal shareholders include the Bank of Bermuda and Lines Overseas Management is well on the way to becoming an e-commerce flop.
The share price of First Ecom.com Inc. hit an all-time low of $1.063 on NASDAQ on November 30, 2000 just nine months after a trading high of $34 on the over-the-counter market.
How to take over a NASDAQ-listed firm using ‘toxic convertibles’
A lawsuit filed in the United States against a Bahamas-based mutual fund offers a fascinating insight into how stock promoters can wrest control of a publicly-traded firm through alleged stock manipulation.
Louisiana-based National Affiliated Corporation claims that it was a victim of a method of stock manipulation known in the industry as a 'death spiral' or 'toxic convertibles'.
British Trade and Commerce Bank’s financial troubles worsen
Dominica-licensed British Trade & Commerce Bank appears to be on its last legs, if a recent letter to clients from the bank's President, Rodolfo Requena, is anything to go by.
In the letter, Requena seems to be digging the bank into a deeper hole by offering rates of return of up to 50 per cent for clients who delay making withdrawals.
Martin Hoffman Interview: Part Three
InsideBermuda continues this month with the third installment of our in-depth interview with New York-based businessman Martin Hoffman, who has attracted his fair share of publicity since he entered the insurance industry in the 1960s and has been an active participant in the Bermuda market.
Robin Cotterell acquitted of money laundering
Nevis-based offshore provider Robin Cotterell has been acquitted of criminal money laundering charges following a jury trial at the U. S. District Court for the Southern District of New York.
After a trial that lasted eight days, British-born Cotterell was unanimously acquitted on November 29, 2000 on one count of money laundering and one count of conspiracy to commit money laundering.
Insider Talking: November 30, 2000
In an attempt to more accurately gauge the expectations of investors when they go offshore, we decided not to close last month's Internet poll on offshore investing but to keep it going indefinitely; Approximately 1,911 investors have filed claims totaling US$189.3 million, according to the latest report by the Receiver of the Cash 4 Titles alleged Ponzi scheme, which operated largely out of the United States, the Cayman Islands and the Bahamas; Controversial businessman Yank Barry, who hails from Montreal in Canada, has been given his passport back by Judge Lynn Hughes sitting at the U. S. District Court for the Southern District of Texas, where Barry is awaiting trial on eight counts of bribery, fraud and money laundering; The Panama Supreme Court has still not ruled on a dispute between The Harris Organization and La Comisión Nacional de Valores (National Securities Commission), which ordered the suspension of the financial services group's operations for operating without a license; The State of Washington Department of Financial Institutions Securities Division has issued a Cease and Desist Order against Grenada-registered Joie De Vie Ventures Inc., which Offshore Alert exposed earlier this year, and Arthur Kilner, d.ba. Kilner Enterprises Ltd.; and We recently contacted Bill Wallace, of Pannell Kerr Forster, in Nassau, to ask how his accounting firm was able to perform a competent audit of several Bahamas and Grenada-registered mutual funds operated by the Imperial Consolidated Group when the BVI-registered companies upon which the funds' solvency entirely depends do not appear to be audited.
Losses mount at Stirling Cooke
Faced with mounting legal bills and no longer earning brokerage commissions and underwriting fees by spinning premiums around in a circle, Stirling Cooke has reported another heavy quarterly loss.
The company lost $2.6 million or 27 cents per share for the quarter ended September 30, almost identical to the corresponding period of 1999.
Default judgment entered against Bank of Bermuda in Cash 4 Titles lawsuit
A default judgment has been entered against the Bank of Bermuda in a racketeering lawsuit filed by the Receiver of the alleged $300 million Ponzi scheme known as Cash 4 Titles.
The judgment was entered against the Bank of Bermuda Ltd. and the Bank of Bermuda (Cayman) Ltd. on November 20, 2000 at the U. S. District Court for the Northern District of Illinois.
BVI firm blames Lines Overseas Management for $980,000 investment loss
A BVI-registered firm is appealing a Bermuda judge's ruling that it must provide a $100,000 security deposit before it can proceed with a negligence claim against investment firm Lines Overseas Management.
Overseas Finance Management will argue that it is unfair to expect a plaintiff to put up additional funds to pursue a claim against a defendant accused of squandering virtually all of its assets.
BVI and Bahamas funds used in alleged $70 million fraud aimed at Latin Americans
Two offshore funds allegedly involved in a $70 million scheme to defraud investors who mainly resided in Latin America have been put into receivership following court action in the United States.
Bahamas-registered United World Capital Fund Limited and BVI-registered United World Capital Limited consented to the receivership after being named as defendants in an SEC lawsuit filed in Texas.
Bahamas-based Surety Bank to go into liquidation
Bahamas-based Surety Bank & Trust is to go into voluntary liquidation after its banking license was suspended by the Central Bank of the Bahamas.
The license was suspended on November 23, 2000 for a breach of Section 11 of the Banks and Trust Companies Regulations Act, which deals with capital adequacy and reporting requirements.
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Two more Harris Organization clients deported to US to face criminal charges
Two more clients of The Harris Organization have been arrested in Panama and deported to their native United States to face trial on criminal charges.
Anthony Vigna, 68, and his son, Joseph, 35, were arrested on November 9, 2000 as they left their homes in Panama and immediately flown to Miami, where they are being held in custody.
Isle of Man AG thanked by SEC for tracing bankrupt’s offshore assets
The Isle of Man Attorney General has been publicly thanked by the US Securities & Exchange Commission for helping to track down the offshore assets of a massively bankrupt businessman.
The praise came after a New York court issued an injunction preventing the transfer of ownership of a Florida gaming cruise ship apparently controlled by a bankrupt businessman through three offshore trusts.