Lines Overseas Management’s close ties with owner of dubious investment clubs
Links between Lines Overseas Management and the Agora Group.
Equity Management Group’s unhappy clients
Complaints from investors in several countries have been made against the Equity Management Group, a firm of stockbrokers based in the Bahamas. Several clients, including those from Spain, France, Switzerland and South Africa, have accused the company of misappropriating their funds, according to sources.
Details of Clarendon insurance group’s past shady dealings
An extract that mentions the Clarendon Insurance Group that appeared in the 'Failed Promises' report into the insurance industry that was published in the early 1990s by a US Congressional committee chaired by John Dingell.
BSX secures listing of another Cayman mutual fund – China Energy
The Bermuda Stock Exchange has approved the listing of up to 4.5 million voting common shares of the China Energy, Metal & Mining Fund - China Mining Sub Fund. The fund is incorporated in the Cayman Islands and is structured as a closed-ended umbrella fund. It is the latest in a long line of Cayman registered funds that have decided to list in Bermuda rather than their place of domicile.
Bermuda Insurance Index loses 22 per cent of value
The FTSE/BSX Bermuda Insurance Index, which was launched on July 15, 1998 with a value of 1,000 and broadly tracks the performance of the island's insurance market, had lost 22 per cent of its value by September 29, falling to 773.36. Such a large fall could indicate it might be an opportune time to buy into the Bermuda Insurance Index Fund Limited, which received approval this month to list up to 10 million non-voting common shares.
Arbitration farce forces Belvedere Insurance into liquidation
Belvedere Insurance Company Limited has gone into permanent liquidation after an arbitration hearing that could have saved the company turned into a fiasco. BICL had been pinning its hopes for survival on a favourable ruling on its claim for $9.6 million in underwriting and run-off fees against fellow Bermuda company GTE Reinsurance Company Limited. But the arbitration hearing on September 21, 1998 ended almost as soon as it began after panel chairman Sir Charles Staughton QC rejected BICL's choice of liquidator, Richard Grey.
Agora’s investment clubs – complaints galore
Fancy making an annual 100 per cent return on your investment with minimum risk? Or how about receiving immunity against cancer, diabetes and senility? It might sound too ridiculous for words - and of course it is - but people are actually falling for this promotional spiel put out by two private investment clubs run by Baltimore-based Agora Publishing, which has close business ties to Lines Overseas Management, a Bermuda-based financial services firm, and also Lord William Rees-Mogg, former editor of The Times newspaper of London.
Stirling Cooke share price roller-coaster
The share price of Stirling Cooke Brown Holdings has endured a roller-coaster ride on the NASDAQ stock exchange since our disturbing revelations about the company last month.
Following our story, the share price quickly dropped to an all-time low of $11.125, which represented a 63 per cent drop in just five months and a fall of 49 per cent on its IPO price of $22 last November when the company was taken public by Goldman Sachs.
Cayman amendment to PCCL drops fiscal exemption clause
The Cayman Islands government has drawn up an amendment to its Proceeds of Criminal Conduct Law that removes the fiscal exemption clause that so irritated the UK's Foreign and Commonwealth Office. However, the proposed amended legislation would still appear to offer little in the way of comfort to foreign governments seeking information about, and the seizure of, assets held by suspected tax evaders.
Arbitrations: What public companies must disclose
Virtually every insurance or reinsurance contract written in Bermuda these days has a clause stating that claims disputes should be arbitrated, rather than litigated. The intention is to save money and time but a massive drawback for insurance and reinsurance buyers is that, unlike lawsuits, arbitrations are held in secret so you never know who the bad payers are or which companies have practices that border on the criminal.
GTE Re cites reasons why Belvedere Insurance is insolvent
GTE Re applies to wind-up Bermuda-based Belvedere Insurance Company Limited.
Insider Talking: September 30, 1998
Receivers of the Florida Employers Safety Association Self-Insurers Fund sue David Sanz, share price of Stirling Cooke falls to new low on NASDAQ, Elite International Services offers dubious offshore products, Marc Harris on the move, prison inmate Ronald Williams apparently continues to rip people off during his day-release program, Bahamas Prime Minister Hubert Ingraham puts both feet in his mouth during press conference for murder of foreign national.
Global Currency Trust shuts down
Global Currency Trust, which has claimed at various times to be based in Nevis and the Bahamas, although it may not be registered anywhere, appears to have closed for business, leaving behind at least one angry investor.
Stirling Cooke’s share price drops like a stone amid more allegations of murky past
As the share price of Stirling Cooke Brown Holdings Limited continues to plummet for reasons that appear unrelated to the general market slide, Inside Bermuda has uncovered fresh evidence that casts an extraordinarily negative light over the company and its main business partner, the Clarendon insurance group.
MRM takes battering on Yahoo! stock message board
Mutual Risk Management has been one of the best-performing stocks in any sector since it went public in June, 1991 but you wouldn't think so from the postings on a popular Internet message board run by Yahoo! and used by analysts, investors and others to 'discuss' the firm's stock.
PaineWebber fires broker, closes offshore brokerage accounts
PaineWebber this month fired long-serving broker Terry Cross and terminated its relationship with Bahamas-based financial and corporate services company International Trade & Investments Limited over fears of becoming implicated in a possible tax evasion scandal.
PaineWebber took this aggressive action after being tipped off that Cross, who worked at its San Francisco office, had allegedly promoted tax evasion during a speech he gave at an offshore seminar held two months ago in Nassau by ITI.
Bermuda’s Minister of Tourism loses $2 million legal decision in US
Bermuda hotelier David Dodwell, who is also the island's Minister of Tourism, has lost a legal decision in the US which may cost him $2 million personally and which also has jurisdictional implications for all offshore businessmen.
On August 4, 1998, the United States Court of Appeals for the Fourth Circuit reinstated a $2 million default judgment against Dodwell that had previously been granted in favour of plaintiff Lee N. Koehler and then quashed by a lower court in Maryland.
Reports implicate Stirling Cooke in fraudulent insurance schemes
Two reports into Stirling Cooke Brown that were compiled two years ago by a London firm of insurance investigators on behalf of a client gives an interesting insight into the history of the Bermuda-based insurance broker, particularly allegations that the company was involved in a reinsurance spiral.
The alleged spiral that we have been told has dragged Stirling Cooke and the Clarendon group into arbitrations in London at least partly involves North American Fidelity & Guarantee and Stockholm Re (Bermuda).
BVI government discusses its all-crimes legislation
The British Virgin Islands government has denied that its Proceeds of Criminal Conduct Law is 'defective' by UK standards, even though it agrees that its legislation provides no assistance for foreign investigations into tax offences.
Since the UK has already described the all-crimes laws of Bermuda and Cayman as defective for similar reasons, there would seem to be little doubt that the BVI's law is considered in a similar light by the UK, which has also been confirmed to us by an independent source.
Lawsuits brought against Clarendon, Martin Hoffman and Eton Management
Further allegations of wrongdoing against entities involving Clarendon Insurance Group Managing General Agent Martin Hoffman and Clarendon itself are contained in two US lawsuits currently awaiting trial.
Both actions were filed at the United States Bankruptcy Court for the Southern District of New York by the administrators of Qualis Care L. P., which is currently in bankruptcy.
Insider Talking: August 31, 1998
We devote a large portion of this month's Insider Talking to Lines Overseas Management, which is based in Bermuda and also has offices in the Cayman Islands and Guernsey, including a letter from one of the company's Cayman-based financial advisors that makes inaccurate claims and promotes illegal activity; We end this segment on LOM by revealing the contents of a letter written this month to a potential US client by Joe P. Montgomery, a financial advisor with LOM (Cayman), whose services as advertised by Montgomery would appear to be a money launderer's dream; The frequency with which Robert Pires, owner of stock broker/financial adviser Bermuda Investment Advisory Services, and members of his staff fall out, leading to staff departures, continues to occur at an alarming rate; We have reported in the past about John Deuss' courting of the Progressive Labour Party in the run up to this year's General Election; a relationship that has involved wining and dining PLP leader Jennifer Smith on his luxury schooner and paying off the mortgage of the PLP's party headquarters; The first of two lawsuits that are being brought against Cayman Minister of Land John McLean is due to be filed at the Grand Court of the Cayman Islands during September, not August, as we had previously expected; and The government of Nevis narrowly failed to take the island independent in a referendum held on August 10.
Cops 0, Robbers (Alleged) 1
The first real test of Cayman's anti-money laundering Proceeds of Criminal Conduct Law 1996 has ended in victory for the alleged money launderers and defeat for the US government - all because the US authorities were a day late in meeting a key filing deadline.
Although not agreeing with his interpretation of at least two key points of the PCCL, Cayman's Court of Appeal nevertheless upheld a decision by former Chief Justice George Harre to discharge a restraint order freezing $7 million in three accounts at the Royal Bank of Canada that were controlled by Americans William J. McCorkle and his wife, Chantal.
Ultimatum for bankrupt who hid assets offshore
A former high-flying Wall Street options trader who fell on hard times has been given a difficult choice by a Miami bankruptcy judge: either hand over the estimated $7 million that he placed in an offshore trust to avoid paying his debts or never have his $20 million bankruptcy discharged.
This novel approach to combating debtors who hide their money offshore rather to avoid paying their debts was adopted by Judge Thomas A. Utschig.
Marc Harris latest: Liquidity crisis deepens, another client goes to prison
More information has come our way this month that sheds further light on the current and past turmoil of The Harris Organization of Panama, including details of liquidity problems, the conviction of another one of its clients on a drug trafficking charge and allegations of 'bounty hunting' against two of the group's officers.
The financial services group, which we have previously reported as being insolvent, running a Ponzi scheme, ripping off clients and laundering the proceeds of crime, seems to be in financial trouble.
Bermuda Fire & Marine liquidators rejected $10-$15 m offer to settle lawsuit
Defendants in a fraud lawsuit involving Bermuda Fire & Marine Insurance Company made an offer last year of between $10 million and $15 million to settle the case, OffshoreAlert can reveal.
However, Bermuda Fire's liquidators, Ernst & Young, rejected the offer on the grounds that it fell substantially short of what was acceptable, said a source whose company is owed money by Bermuda Fire.
Bermuda should not become haven for tax crimes, says Financial Secretary
Bermuda should not develop the reputation of a haven for those wishing to "hide the proceeds of tax crimes", the Ministry of Finance's Financial Secretary told the Money Laundering and Cybercrime Control conference that was held on the island this month.
Addressing a proposed amendment to Bermuda's Proceeds of Crime Law to incorporate tax offences committed in foreign countries, Peter Hardy said Bermuda faced a "dilemma".
Court rejects Price Waterhouse bill of $76 m for 63 days of liquidation work
A Hong Kong judge has hit out at the provisional liquidators of the Bermuda-registered Peregrine Group after they and their legal advisers charged fees of $76 million for just 63 days of work.
Doreen Le Pichon, Judge of the Court of First Instance High Court, said she was "greatly troubled by the amount involved" and refused to accept the charges of accounting firm Price Waterhouse and its legal advisers unless they could prove the work was reasonable and necessary.
US freezes $3.2 m at Stanford International Bank
U. S. authorities have frozen nearly $3.2 million in accounts at Antigua-based Stanford International Bank, as part of an investigation into the illicit fortune of the late Mexican drug lord Amado Carrillo Fuentes, reported The Wall Street Journal.
Mark Hardy’s bankruptcy annulled in the UK
The bankruptcy of former Bermuda-based businessman Mark Hardy has been annulled in London, OffshoreAlert can reveal.
Creditors of seven failed Hardy companies, including Forum, Focus and Aneco, which were all based in Bermuda, agreed to the annulment three months ago in return for Hardy signing over various assets and debt recovery rights relating to his failed business empire.
Cayman government continues its immoral ways
In what might rank as one of the most immoral decisions ever made by a democratic government anywhere in the world, Cayman Minister of Land John McLean has been allowed to keep his ministerial position even though a vote to oust him was carried by eight to six in the Legislative Assembly.
Members of the Legislative Assembly who were trying to remove McLean from office for allegedly illegally obtaining over 200 acres of Crown Land worth tens of millions of dollars fell one vote short of the required nine votes needed to pass their motion.
More trouble for Clarendon Insurance and Martin Hoffman new lawsuit filed in New York
Clarendon National Insurance Company, Eton Management and Martin Hoffman have all been named as defendants in a lawsuit filed on June 15, 1998 in New York Southern Bankruptcy Court by Qualis Care LP, an entity owned by Hoffman that is currently in administration.
Last year, the same plaintiff brought an action in the same court against Hoffman's Barbados-based Knightsbridge International Reinsurance company: a case that is currently awaiting trial.
US Internet gaming ban moves a step closer
A law banning Internet gaming moved a step closer to reality this month when the US Senate voted overwhelmingly in favour of it.
The Senate voted by 90 votes to ten to approve a Bill presented by Senator Jon Kyl (Republican-Arizona) that would make it a crime to place a bet over the Internet and to offer Internet gaming services.
Shurely Shome Mishtake! Clarendon Insurance Group’s questionable regulatory disclosures
Annual statements filed with regulators by Clarendon National Insurance Company are becoming increasingly confusing, not to mention inaccurate in places.
Take, for example, its 1996 filing with the New Jersey State Insurance Department, the home regulator for this operating arm of a group that has subsidiaries in Bermuda and the US.
Cayman’s fiscal exemption clause in PCCL may be legally invalid
The fiscal exemption clause in the Cayman Island's Proceeds of Criminal Conduct Law may be legally invalid, according to a leading local lawyer and trust services provider.
Attorney WS Walker said that legal advice obtained by his firm in London was that the exemption would not stand up if legally tested.
David Brown takes reduced role at Centre Solutions
Has David Brown stepped down as head of Centre Solutions?
GTE Re applies to wind-up Belvedere Insurance in dispute over $9M fee
A dispute between Belvedere Insurance and GTE Reinsurance Company, which are both based on the island, turned ugly this month when the latter applied to Bermuda Supreme Court to have the former wound up.
The irony of GTE Re's application is that the company is believed to be a net debtor of Belvedere's, rather than a net creditor.
American wins return of funds he tried to take out of US without filling in the paperwork
For the first time in its history, the US Supreme Court has struck down a fine as unconstitutional, ruling that the federal government cannot always seize and keep all the money people try to take outside of the country without filing the proper paperwork, reported the Associated Press.
Raydon/Stockholm Re in arbitration
Two applications have been filed at Bermuda Supreme Court recently in relation to an arbitration between Stirling Cooke Brown subsidiary Raydon Underwriting Management and Stockholm Re (Bermuda), which folded a few years ago.
Florida businessman indicted, Stirling Cooke ordered to place $500,000 into escrow
Businessman David Sanz was criminally indicted in the US last month to face charges of racketeering, grand theft and fraud in relation to Florida-based Gulf Atlantic Management Group Inc., which he owned.
The offences include an allegation that Sanz illegally stripped off millions of dollars from GAMG over several years and, in a final flourish as the regulatory net closed in, sold its entire book of business of GAMG and that of a related company to Stirling Cooke Insurance Services for $1 million.
US government battles for jurisdiction over Swiss American Bank
A battle for legal jurisdiction between the US government and four offshore financial institutions in a $7 million forfeiture case contains a number of important issues that will affect all companies and individuals who operate offshore but have US clients.Among arguments being put forward by the US government for jurisdiction over banking entities located in Antigua, Switzerland and Panama is the fact that the offshore companies sell their services over the Internet, which can be accessed in the US; that Swiss American Bank has advertised in the in-flight magazine of American Airlines; and that SAB has correspondent banking relationships with banks in the States.
John Deuss lays off staff at Transglobal Insurance after disappointing results
Transglobal Insurance (Holdings), which is owned by Bermuda-based oil magnate John Deuss, is changing its senior management, cutting back expenses and altering its marketing focus in the wake of disappointing results in its first 18 months in business.Transglobal president Lionel ‘Kip' Herring is being laid off shortly and the company's controller, Beau Franklin, left recently to join another firm in Bermuda.
US seeks to extend legal powers over foreign countries
Major legislation has been introduced to US Congress that would extend the power of the US authorities to apply its money laundering laws and penalties in other countries.The proposed laws, which were tabled in April, has the support of both Democrats and Republicans, according to a report in Miami-based newsletter Money Laundering Alert.
Lawsuit alleged impropriety against Martin Hoffman, proves his links with Clarendon/Spencer-Arscott
A lawsuit filed three years ago in New York is revealing in that it includes details of another business deal involving Martin Hoffman that ended in tears amid allegations of fraud and dishonesty and shows a link between Hoffman, the Bermuda/US-based Clarendon insurance group and Bermuda insurance consultant Robin Spencer-Arscott.
Kemper Re settles with EMLICO liquidators
Kemper Reinsurance and the Bermuda-based joint liquidators of Electric Mutual Liability Insurance Company have announced a settlement of their long and acrimonious dispute over EMLICO's insolvency.
Cayman governor promises to recognize fiscal offences
Cayman governor John Owen appears to have secretly promised the UK government that Cayman will change its law to allow foreign investigations of tax evasion.That is the startling revelation disclosed in the minutes of a meeting of the Public Accounts Committee of the UK government held in London on December 15, 1997.
Bermuda Stock Exchange ready to launch insurance index
The Bermuda Stock Exchange will next month launch an index and mutual fund that will track the performance of ten publicly-listed insurers and reinsurers based in Bermuda.
UK offshore tax initiative: The truth finally comes out after months of misinformation
The unfolding saga of moves by the UK to force its Overseas Territories to recognize fiscal offences in its mutual legal assistance laws is extraordinary in that it reveals the lengths that politicians, civil servants and businessmen will apparently go to lie or mislead the public when they think it is in their best interests to do so.It also underscores the importance of newsletters like Offshore Alert, which was launched in February, 1997 to provide clients with an independent and accurate source of information in a sometimes overly secretive offshore world where the truth is often difficult to find.
Shorex 98 focuses on Europe, the Internet and offshore financial services
Shorex 98, which is probably the biggest offshore exhibition and conference around, takes place at the Business Design Centre in London on October 20-22.Labeled ‘The International Money Show', the event's organizers expect to attract over 100 exhibitors and 6,000 visitors from around the globe.
Insider Talking: June 30, 1998
Offshore regulators apparently uninterested in scams exposed by OffshoreAlert; NimsTec's 3-D cameras offered for sale as "collector's items" over the Internet; Marc Harris has t-shirt with the slogan: "David Marchant is alive because killing him would be a crime"; As General Election looms, Progressive Labour Party tipped to win power in Bermuda for the first time; Dominion of Melchizedek offers a variety of fraudulent products and services; and Little Switzerland contemplates legal action after proposed purchase of Colombian Emeralds International falls through.
Offshore Territories must enforce ‘all-crimes’ laws, not just pass them into law
Offshore financial centres that are also UK Overseas Territories have been told that it is not enough for them simply to introduce legislation outlawing ‘all-crimes' but that they must also enforce the new laws.That was one of the messages delivered to the House of Commons Select Committee on Public Accounts by Sir John Kerr, Permanent Under-Secretary of State for the UK government.