Investment

Four offshore bankers arrested, two more on the run

November 30, 2001

Four offshore bankers were arrested by United States law enforcement agencies in November and charged with money laundering.Two more have also been charged with money laundering but are still at large after warrants were issued but not executed.Those arrested were

Americas International Bank is insolvent, used to launder fraud proceeds, says liquidator

November 30, 2001

Bahamas-based Americas International Bank Corporation Ltd. is insolvent and was used primarily as "a vehicle to launder funds" received from investment fraud, according to its liquidator.Accountant Clifford Culmer painted a bleak picture of the bank's activities in an affidavit filed with the Bahamas Supreme Court on November 19, 2001.

USA v. Julien Giraud et al: Criminal Indictment

November 27, 2001

Indictment in USA v. Julien Giraud and Brian Boeger at the U. S. District Court for the Southern District of Florida.

Italy: Armando Cultrera et al

November 14, 2001

Application for the appointment of a Commissioner to collect evidence for a criminal investigation in Italy into Armando Cultrera, Vincenzo Cultrera, Carmela Cultrera, Roberto Cultrera, Isabella Albergo, Franco Giardano, Sonia Bonazzi, Loredana Capuano, Roberta Papini, Gianna Laura Boccaforno, Ettore Ragozzini and Mirella Tromba for alleged fraud.

Offshore fund manager Geoffrey Warne commits suicide

November 8, 2001

A man who was kidnapped earlier this year in a dispute over a fraudulently-operated offshore mutual fund has committed suicide.Geoffrey Hamilton Warne, 41, died at his home near Kingston, Ontario on October 4.

Insider Talking: October 31, 2001

October 31, 2001

More has become known about the re branding of the First Nevisian Group, which is now known as The FN Group, and the partial move from Nevis to the Dominican Republic, where its "strategic partner" is H. E. Partners, which

Fraud lawsuit filed against public issuer linked to Hawthorne-Sterling

October 31, 2001

A firm whose insiders included the now defunct Hawthorne Sterling mutual fund group of the Bahamas has been accused of stock fraud in the United States.The stock of Trans Energy Inc. was artificially inflated by the dissemination of several false

New England International Surety boss Hendrik Rienstra arrested

October 31, 2001

The 72 year old principal of a Panama domiciled company that allegedly provided sham insurance for investment scams has been arrested in Belgium, where he is based.Hendrik Rienstra, of New England International Surety Co. Inc., was among six people arrested

British Columbia Securities Commission declares Tri-West fraudulent

October 31, 2001

The British Columbia Securities Commission has found that Tri-West Investment Club, which operated from addresses in Belize and the Bahamas, committed investment fraud.In a ruling dated October 23, 2001, the Commission ruled against the Club, Haarlem Universal Corporation, Jason Kingsley, Mark Goldman, Alan Richards, Alex Harlem and John Byron. The Commission is scheduled to rule on sanctions on November 9 after giving the parties an opportunity to respond to the ruling.

TCI arrest warrants for Wayne and Scott Turner

October 31, 2001

Arrest warrants for Wayne Turner and his son, Scott, have been issued in the Turks and Caicos Islands following the collapse of their firm, Atlas Securities Inc., four months ago amid allegations of fraud.The warrants were issued at the local Magistrates Court on October 23, 2001 and are the first step in an attempt to extradite the Turners from Canada.

SEC lawsuit against Crescent Capital Offshore Fund

October 31, 2001

A Bahamas-domiciled firm that purported to be an "offshore hedge fund" has been named as a defendant in a civil lawsuit filed by the SEC in the United States.Crescent Capital Offshore Fund participated in a fraudulent investment scheme that raised more than $11.6 million from approximately 350 investors, it has been alleged.

Bahamas firm has assets frozen in Florida

October 31, 2001

Bahamas-domiciled Global Asset Partners Ltd., which described itself as "a private asset management company located in The Bahamas", has had its assets frozen in the United States.The freeze order was issued after a lawsuit was filed against the firm by the SEC at the US District Court for the Southern District of Florida on September 28, 2001.

Restructuring at Imperial Consolidated, libel lawsuit dismissed

October 31, 2001

The Imperial Consolidated Group has changed its corporate structure for the second time in nine months.Changes include its British-based holding firm, Imperial Consolidated PLC, re-registering from public to private status three days before its year-end of September 30, 2001.

Terry Neal’s bank named as a relief defendant in stock fraud lawsuits

October 31, 2001

A Nauru-licensed bank that is operated from Nevis was used to launder most of the more than $30 million in profits from a fraudulent stock trading ring, it has been alleged.Exchange Bank and Trust, which is operated by Terry Neal's Nevis American Trust Co., has been named as a relief defendant in three of four related lawsuits filed by the SEC in the United States.

Ernst & Young (Bahamas) fails to have action dismissed

October 31, 2001

Ernst & Young (Bahamas), partner Paul Clarke and former partner Philip Galanis have failed to obtain the dismissal of a civil lawsuit filed against them in the United States.They now face a trial on allegations of investment fraud that were brought under the Racketeering Influenced and Corrupt Organizations Act.

Courts approve Cash 4 Titles-Bank of Bermuda settlement

October 31, 2001

 The settlement between the Bank of Bermuda and victims of the Cayman-based Ponzi scheme known as Cash 4 Titles has received approval of the United States courts."On Friday 12 October 2001, the court gave final approval to the settlement of the Illinois and Florida Cash 4 Titles litigation," stated the Bank in a press release.

Investors in alleged stock scam asked to fund ‘asset recovery’ effort

October 31, 2001

Investors who bought shares in a Bahamas-based firm whose principals promptly closed shop and disappeared are being asked for $100,000 to finance what is being described as an 'asset recovery' effort.It might be a case of throwing good money after bad, however, given the track record of the people spearheading the venture.

Americas International Bank goes into liquidation

October 31, 2001

Americas International Bank Corporation Ltd. has become the latest Bahamas-based private bank to stop operating.AIBC's shareholders passed a special resolution on October 11, 2001 that the bank, which was licensed on September 23, 1994, should go into voluntary liquidation.

EBI Securities Corporation, Inc. et al v. Rene Michael Hamouth et al: Default Judgment

October 12, 2001

Default Judgment in EBI Securities Corporation, Inc. v. Rene Michael Hamouth, The Hamouth Family Trust, 411396BC, Ltd., and Net Command Tech, Inc., f.k.a. Corsaire, Inc., f.k.a. Corsaire Snowboard, Inc. at the U. S. District Court for the District of Colorado.

IBP, Inc. et al v. Andrew J. Zahn et al: Counterclaim for Declaratory Judgment

October 11, 2001

Counterclaim for Declaratory Judgment in IBP, Inc. and Foodbrands America, Inc. v. Andrew J. Zahn and Philip Sexauer at the U. S. District Court for the Northern District of Illinois.

Insider Talking: September 30, 2001

September 30, 2001

How concerned is the Financial Times newspaper about being used to facilitate fraud? Not enough to stop publishing bogus valuations for the Cayman Islands domiciled Aristocrat Endeavor Fund. The FT is continuing to accept and publish sham Net Asset Values

Imperial Consolidated lays off workers

September 30, 2001

Imperial Consolidated PLC, which is funded by offshore mutual funds, has laid off a majority of its workforce at its main site in the village of Binbrook, England.All 150 200 workers at Binbrook received letters on August 31 advising them

Contempt action against former Grenada banker Gary Bentz

September 30, 2001

The SEC is seeking to have a former principal of a Grenada based offshore bank held in contempt of court in the United States for allegedly breaching an asset freeze order.Gary Joel Bentz, who helped run Wellington Bank and Trust,

Enforcement action filed against Aurum Society

September 30, 2001

The Commodity Futures Trading Commission in the United States has filed an enforcement action against Bermuda domiciled Aurum Society Inc. and Andrew Duncan, of Toronto, Canada.The defendants have been accused of fraudulently operating a commodity pool and misappropriating at least

Investigators look at short-sales in XL stock prior to terrorist attacks

September 30, 2001

Short sales in the stock of XL Capital increased sharply on NYSE in September but there is no hard evidence that investors were acting on pre knowledge of the terrorist attacks in New York.Short sales of XL stock amounted to

Meridian Investment Bank has license revoked in Grenada

September 30, 2001

Meridian Investment Bank, whose principals include a plumber and an officer with the Canadian Space Agency, has become the latest bank in Grenada to have its license revoked amid allegations of fraud.MIB's banking license was revoked effective September 4, 2001

Criminal complaints filed against former Bahamas-based stockbrokers

September 30, 2001

Criminal complaints for alleged securities offenses have been filed against nine people in Thailand, including two who were once involved with a fraudulent Bahamas based stockbroker.Pierre Gonyou and Kimberly Gonyou, formerly of Equity Management Group, of the Bahamas, are among

Convicted criminal files lawsuit against Nevis-based firms and resident

September 30, 2001

Nevis Trust Ltd. and Nevis resident Gillian Hobson are among several parties being sued for $9.6 million by the former owner of a Nauru registered bank who was recently imprisoned for fraud. A civil complaint was filed by Michael D.

Bahamas mail-drop firm raises capital in illegal offering, then folds

September 30, 2001

Bahamas-based mail-drop firm ASAP Services Ltd., which only 10 months ago was selling unregistered shares that valued the tiny firm at $135 million, has collapsed after four years in business. Visitors to the firm's web-site at www.asapbahamas.com are greeted with an announcement stating that "as of August 31, 2001, A.S.A.P. Services, Ltd. is officially closed for business".

Securities fraud lawsuit filed against Tri-West Investment Club

September 30, 2001

A securities fraud civil lawsuit has been filed in the United States against an investment firm that used addresses in the Bahamas and Belize while raising money in an alleged high yield investment scam. The action was filed by the SEC against Tri-West Investment Club, Alyn Richard Waage and Haarlem Universal Corp. at the U. S. District Court for the Northern District of California on September 6, 2001.

Appeals court reinstates fraud lawsuit against Stock Generation

September 30, 2001

An appeals court ruling in the United States has allowed the SEC to proceed with a civil fraud action against the owners of a Dominica-based virtual stock market 'game' known as Stock Generation. On September 13, 2001, the United States Court of Appeal for the First Circuit overturned a lower court's decision to throw out the SEC's action against SG Ltd.

TFM Investment Group et al v. Andrew J. Zahn et al: Class Action Complaint

September 7, 2001

Consolidated Amended Class Action Complaint in TFM Investment Group, Mark J. Dearman, WPG Merger Arbitrage Fund, LP, and WPG Merger Arbitrage Overseas Fund, Ltd. v. IBP, Inc., Foodbrands America, Inc., Diversified Food Group, LLC, Robert L. Peterson, Larry Shipley, Richard L. Bond, R. Randolph Devening, William Brady, Andrew Joseph Zahn, and Philip Sexauer at the U. S. District Court for the District of South Dakota.

Montaque Securities International Ltd. v. Amore Capital Management LLC, et al: Complaint

September 7, 2001

Complaint in Montaque Securities International Ltd. v. Amore Capital Management LLC, John J. Amore and Janet Amore at the U. S. District Court for the Eastern District of New York.

Former owner of AFC Re caught up in fraud investigation

August 31, 2001

The former owner of Bermuda-registered AFC Re has been caught up in an investigation into an alleged $200 million fraud involving an unlicensed offshore mutual fund.Atlantic Portfolio Analytics and Management, of Orlando, was an investment adviser to Evergreen Security Ltd., which filed for bankruptcy in Florida on January 23, 2001.

Asset freeze order against Surety Bank and Trust over failed mutual fund

August 31, 2001

A Florida court has issued an injunction forbidding the liquidator of Bahamas-based Surety Bank and Trust from distributing assets to seven people, including six of the bank's shareholders.The injunction is part of an investigation into an alleged $200 million fraud committed in the name of Evergreen Security Ltd., which effectively operated as an unlicensed offshore mutual fund.

The FN Group refuses to comment on mystery offering

August 31, 2001

OffshoreAlert has come across a $10 million note offering in which The FN Group, formerly known as the First Nevisian Group, acts as the arranger, dealer and registrar and controls the two guarantors.We understand that the group has used its discretionary investment authority to put some of its clients' funds in the offering, which has led to at least one complaint.The issuer is Nevis-registered Global Power Supplies Inc., whose notes range from 30 days to three years and bear interest of 9 to 10 per cent per year.

Aristocrat Endeavor Fund emerges as key component of First International Bank of Grenada fraud

August 31, 2001

A Cayman-registered mutual fund whose shares were once listed on the Bermuda Stock Exchange has emerged as a centerpiece of the massive fraud committed by the First International Bank of Grenada.Shares in the Aristocrat Endeavor Fund comprised $17.25 million of FIBG's bogus initial capital of $32.75 million in 1997, according to a new report by the bank's liquidator, Marcus Wide.

‘Best efforts’ in an investment contract means just that, rules judge

August 31, 2001

Investment managers who promise investors returns on a "best efforts" basis must prove they did their best to effect such returns if they want to avoid liability in the event of a loss, a judge has ruled.Judge Brian Alleyne, in Grenada, issued his ruling earlier this year in legal proceedings involving a group that promised a 100 per cent return on $1.4 million for ten consecutive months and failed to deliver.

State of Florida v. John McGarrity: Motion to Revoke Bond

August 31, 2001

Motion to Revoke Bond in State of Florida v. John McGarrity at the Circuit Court of the Eighteenth Judicial Circuit, in and for Seminole County, Florida.

‘I never worked for the Bank of Bermuda’, says Michael Wheaton

August 24, 2001

Letter to the Editor of OffshoreAlert from Michael Wheaton, a Cayman Islands resident.

IBP, Inc. et al v. Andrew J. Zahn et al: Complaint

August 22, 2001

Complaint in IBP, Inc. and Foodbrands America, Inc. v. Andrew Joseph Zahn and Philip Sexauer at the U. S. District Court for the Northern District of Illinois.

United Kingdom: Free Dot Net Plc et al

August 15, 2001

Application for the appointment of a Commissioner to collect evidence for a criminal investigation in the United Kingdom into alleged fraud by Free Dot Net Plc and others.

Eurofed Bank depositors are ‘ill-informed’, says Antigua’s chief AML officer

August 13, 2001

Letter to the Editor of OffshoreAlert regarding liquidation of Eurofed Bank from Wrenford Ferrance, Director - Office of National Drug Control and Money Laundering Policy.

Germany: Hans Heinrich Kuhlen

August 10, 2001

Application for the appointment of a Commissioner to collect evidence for a criminal investigation in Germany into Hans Heinrich Kuhlen for suspected investment fraud.

Brazil: Cayman Dossier

August 8, 2001

Application for the appointment of a Commissioner to collect evidence for a criminal investigation in Brazil into Paulo Salim Maluf (former Mayor of Sao Paulo), Caio Fabio D'Araujo Filho and Lafaiete Coutinho regarding the alleged sale of a counterfeit document known as the 'Cayman Dossier' in an attempt to discredit the President of Brazil, Fernando Henrique Cardoso, and other politicians.  

FIBG founder viewed porn while fleecing investors

August 5, 2001

First International Bank of Grenada founder Van Brink appears to have spent much of his time viewing pornography over the Internet while clients were being fleeced, according to investigators. An analysis of a hard-drive taken from a computer used by Brink in Grenada showed that "about 80 per cent" of the settings on his Internet browser were pointed at porn sites, OffshoreAlert was told.

Lines Overseas Management lists on Bermuda Stock Exchange

July 31, 2001

Shares of the parent company of Bermuda-based stockbroker Lines Overseas Management were listed for the first time on the Bermuda Stock Exchange on July 24.A statement that the shares had been approved for listing was made on July 20 without any prior public announcement that an application had been submitted.

Miami expenses of Cayman officers helped seal Bank of Bermuda’s fate

July 31, 2001

Expense accounts and management reports handed over in discovery weighed heavily against the Bank of Bermuda (Cayman) in its fight to avoid United States jurisdiction in the Cash 4 Titles litigation.In one report, the Bank's management stated: "Miami continues to grow in importance as a location with potential business and we are now working with a number of relationships with a Miami presence."

Prison sentences for Hammersmith Trust pair

July 31, 2001

Lengthy prison terms have been handed down to the first two defendants to be sentenced in a $64 million fraud some funds were laundered through the Bank of Bermuda in the name of an Antiguan 'paper' bank.William H. West, of Niceville, Florida was the first to be sentenced, receiving 136 months in prison and ordered to pay restitution of $25 million at a hearing on July 19, 2001.

Daniel Danker sent to prison for investment fraud

July 31, 2001

One of the principals of a now defunct Grenada-registered bank has been sentenced to five years and 11 months in prison in the United States.Daniel G. Danker, 53, was also fined $50,000 and ordered to pay restitution of more than $20 million at the U. S. District Court for the Southern District of Indiana on July 15, 2001.