Tax

US criminal defendants become latest victims of John Mathewson

July 31, 1999

Eight defendants in a criminal indictment filed in Nebraska recently appear to be the latest victims of former Cayman banker John Mathewson's decision to help US authorities investigate his ex-clients.David Abboud, his brother Gene, son Baron and nephew Joseph, Susan Germer, United Imports Corp. (d.b.a. M. D. Electronics), G&A Distributing Inc. (d.b.a. Broadway Enterprises) and Infinite Electronics were charged on April 26, 1999 with 15 counts of Mail Fraud, 11 counts of Wire Fraud, seven counts of Unauthorized Reception of Cable Television Service, one count of Conspiracy to Commit Money Laundering, and 13 counts of Domestic Money Laundering.

Libel trial judge asks: ‘Where is Marc Harris?’

July 31, 1999

The libel trial involving The Harris Organization financial services group of Panama and Offshore Business News & Research ended on July 30 with Judge Michael Moore asking: "Where is Marc Harris?" Harris was nowhere to be seen during six days of testimony even though he was the main subject matter of the March 31, 1998 Offshore Alert article that was being complained about.

USA v. Robert Raymond et al: Judgment

July 27, 1999

Judgment in a civil complaint filed by the USA against Robert R. Raymond and Robert G. Bernhoft, both doing business as Morningstar Consultants, at the U. S. District Court for the Eastern District of Wisconsin - July 27, 1999

Harris Organization/OffshoreAlert trial set to start on July 6, 1999

June 30, 1999

The civil libel trial between Offshore Business News & Research, Inc., which publishes this newsletter, and The Harris Organization financial services group of Panama will start at the United States District Court for the District of Southern Florida (in Miami) on July 6. After two postponements by the court because of scheduling problems, a definite date has now been set for the trial, which is scheduled to last for about one week.

Harris Organization-OBNR trial put back by court

May 31, 1999

The libel trial involving The Harris Organization financial services group of Panama and Offshore Business News & Research, Inc., which publishes this newsletter, has been put back to an unnamed date by the United States District Court for the Southern District of Florida.

First International Bank of Grenada launches Pyramid scheme

May 31, 1999

The First International Bank of Grenada and the sham insurer known as IDIC have launched an international pyramid scheme as the latest phase of their plan to part investors from their money. There is also concern that FIBG may have become involved in stock manipulation involving a Florida-registered penny stock firm that trades on the NASDAQ over-the-counter market.

Marc Harris withdrawn as witness as libel trial draws near

April 30, 1999

The Harris Organization's libel complaint against Offshore Business News & Research, Inc, which publishes this newsletter, and the company's principal, David Marchant, is due to start on May 24 at the United States District Court for the Southern District of Florida (in Miami). We were also notified this month that the group's founder, chairman and sole owner of its common stock, Marc Harris, has been withdrawn from The Harris Organization's witness list.

Two more Harris Organization clients indicted in the US

January 29, 1999

Less than a year after two clients pleaded guilty to cocaine trafficking charges in California, a criminal indictment has been brought in Florida against two more clients of The Harris Organization of Panama. The indictment was filed against Aurelio Anthony Vigna and his son, Joseph R. Vigna, on December 17, 1998 at the Federal District Court for the Southern District of Florida.

Attorneys threaten OffshoreAlert with lawsuit over exposé of insurance-banking fraud

January 29, 1999

Offshore Alert has received two letters from attorneys threatening to sue us over the banking/insurance scandal involving World Investors Stock Exchange, International Deposit Insurance Corporation, First International Bank of Grenada, International Exchange Bank and Fidelity International Bank, that is exposed in the January 29, 1999 edition of Offshore Alert.

Banking-insurance scam advertisements ask investors to sign away their assets

January 29, 1999

Avertisement from 'Vincent Lachmi' and 'Dr. Vincent Kumar' starts appearing on the Internet in connection with fraud perpetrated in the names of the International Deposit Insurance Corporation, the World Investors Stock Exchange, Fidelity International Bank, International Exchange Bank and the First International Bank of Grenada.

Marc Harris-OBNR lawsuit due to be tried in May

January 29, 1999

The Harris Organization's $30 million libel action against Offshore Business News & Research, Inc. and its principal, David Marchant, is scheduled to go to trial in May of this year at the Federal District Court for the Southern District of Florida (Miami).

OffshoreAlert exposes massive offshore banking and insurance fraud

January 29, 1999

Offshore Alert can today expose a massive fraud involving at least three banks, an insurance company and a stock exchange into which investors are believed to have invested tens of millions of dollars. Participants in the scam include the World Investors Stock Exchange in Grenada, the International Deposit Insurance Corporation in Nevis, the First International Bank of Grenada, the International Exchange Bank, which is registered in either Nauru or Grenada but operated out of Bermuda and Texas; and Fidelity International Bank, which is registered in Nauru but operated from St. Vincent.

Conferences cater to the shadier side of the offshore world

December 31, 1998

Mexico played host this month to two seminars organized by individuals and groups operating on the murkier side of the offshore world. Cancun was the venue over December 9-11 for the 'Offshore Wealth Summit', which was put on by Jerome Schneider, who is one of the most reviled figures in the offshore world.

Marc Harris latest: Senior officers undergo lie detector tests

November 30, 1998

Information coming from Panama indicates that November has been yet another bad month for The Harris Organization. All the signs are that the offshore financial services group, which has been accused in this newsletter of running a Ponzi scheme and of massive insolvency, is about to go bust.

Netherlands: Herman Lodewijk Gazan

November 17, 1998

Application for the appointment of a Commissioner to collect evidence for a criminal investigation in the Netherlands into Herman Lodewijk Gazan, a textile merchant, for alleged fraud, receiving stolen goods and tax evasion.

USA v. Kenneth Thenen: Judgment

November 4, 1998

Judgment in USA v. Kenneth Thenen at the U. S. District Court for the Southern District of Florida.

USA v. Kenneth Thenen et al: Thenen’s Witness List

November 4, 1998

Kenneth Thenen's Witness List in USA v. Kenneth Thenen, Daniel Morris, Scott Thenen, Philip Carallo, Paul Braid, Dennis Farber, Richard Schuman, Melvin Brink, Charles Valvo, John Michael Flynn, Alexander McKenzie-Ross, Fernando Colon, Daniel Post, Stacey Thenen Demet, F. Larry Robinette, Dean Henrichs, Eugene Shirley, Kelly Thomas, Marcelli Martinez, Michael Philipson, Gabriel Aboy, Gilbert Harding, Lang Lewis, Peter Tobeck, Jeffrey Berman, Maurice Durbin, John Grifo, Rolando Viadero, Kurbanali Ramzanali, Patricia Dennis, Henry Geringer, Guy Benamati, Nicholas Paun, Harold Schumacher, Michael McClendon, and Dana Schuman at the U. S. District Court for the Southern District of Florida.

The Harris Organization forms UK PLC to raise much-needed cash

October 31, 1998

The cash strapped Harris Organization of Panama has formed a UK public limited company in an apparent attempt to raise up to £5 million ($8.5 million) by selling shares to the public. The Marc M Harris Group PLC was registered

Cayman amendment to PCCL drops fiscal exemption clause

September 30, 1998

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.

PaineWebber fires broker, closes offshore brokerage accounts

August 31, 1998

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.

Marc Harris latest: Liquidity crisis deepens, another client goes to prison

August 31, 1998

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 should not become haven for tax crimes, says Financial Secretary

July 31, 1998

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".

Cayman governor promises to recognize fiscal offences

June 30, 1998

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.

Denmark: Theodor Jens-Jorgen Madsen et al

June 29, 1998

Application for the appointment of a Commissioner to collect evidence for a criminal investigation in Denmark into Theodor Jens-Jorgen Kruse Madsen and Kjeld Kornum Larsen for alleged fraud and tax fraud, including allegedly selling distribution rights to films they did not own.

The colourful world of the promoters of The Harris Organization

May 31, 1998

One wrote a book describing Albania as a "fairy tale land" and promised he could show investors "how to double your capital at no risk", another sells seemingly dodgy insurance brokerage licences to the gullible, promising they are available within 72 hours to people with no qualifications or even a formal education who will be able to access the Lloyd's of London market; and another has written a book on prostitution showing where "balding, fat guys like your author" can find "Thai virgins".

UPS faces $1 billion liability from its Bermuda reinsurer

April 30, 1998

United Parcel Service could be liable for as much as $1 billion in federal income taxes if it loses a case now before the US Tax Court in Atlanta that involves Bermuda based reinsurer, Overseas Partners Ltd., which reinsures UPS

FCO letter presents gloomy picture for offshore finance centres

April 30, 1998

Further details obtained by Offshore Alert about the UK government's new proposals for regulations in its Overseas Territories confirm that what is being planned represents an offshore financial centre's worst nightmare. And there is growing evidence that independent offshore centres like the Bahamas and Antigua are also facing international pressure to conform to new standards.

The Harris Organization: a $30 million lawsuit, more fraudulent banks and an airplane

April 30, 1998

Offshore Alert's exposé on The Harris Organization last month has caused quite a stir, with journalists from several international media organizations showing an interest in following up the story.

‘The Harris Matrix’ for hiding money from the IRS and your wife

March 31, 1998

Offshore Alert has obtained confidential documents that are presented to clients of The Harris Organization advising them how to hide their assets from their creditors, be it the IRS or their wives if they are going through a divorce. The documents are so sensitive that the cover sheet states: "Under no circumstances may this document be utilized outside the offices of The Harris Organization. Misuse or disclosure of this document is subject to civil and criminal sanctions under Panamanian law."

Marc Harris says: ‘We’re cleaner than clean.’

March 31, 1998

David Marchant, the publisher of Offshore Alert, flew to the Bahamas on Wednesday, March 25 to meet with Marc Harris at the Radisson Grand Hotel in Cable Beach, near Nassau. Also present at the meeting were Larry Gandolfi, who is a salesman; Christopher Davy, head of computers; and Alan McAloon, head of trust services.

The Harris Organization’s multi-million dollar Ponzi scheme

March 31, 1998

Offshore Alert can today disclose that Panama's most-hyped financial services group, known as The Harris Organization, is being run as a massive Ponzi scheme in which clients are being defrauded out of millions of dollars. The situation is so serious that The Harris Organization, which employs 150 people in Panama, is hopelessly insolvent, with net liabilities of at least $25 million, according to sources knowledgeable of the group's financial affairs.

FCO announces end of bank secrecy in overseas territories

February 27, 1998

The clearest indication yet that the UK government will force its Overseas Territories to co-operate with foreign regulators investigating both fiscal and regulatory offences was given this week to Offshore Alert.Offshore centres like Bermuda, the Cayman Islands, the Turks & Caicos Islands and the British Virgin Islands are being told by the UK government to introduce within two years legislation that will be virtually identical to the UK Criminal Justice (International Co-operation) Act 1990.

Cayman-UK tax initiative debate

December 30, 1997

Excerpts of a discussion at a meeting on December 3, 1997 of the Finance Committee of the Cayman Islands Legislative Assembly in which opposition members raised the delicate matter of whether the UK government had asked Cayman to begin recognizing fiscal offences in its mutual legal assistance laws. When Offshore Alert first confirmed the existence of a tax initiative in July, the Cayman government accused us of reporting lies. But, as you might be able to discern from the dialogue, there clearly were discussions on the subject, although it appears that the issue has temporarily gone away.

USA v. Robert Raymond et al: USA’s Motion to Dismiss Counterclaims

November 20, 1997

Case 97-cv-00207 - USA v. Robert Raymond et al - USA's Motion to Dismiss Counterclaims - U. S. District Court for the Eastern District of Wisconsin - November 20, 1997

‘Stolen’ Cayman bank records in hands of the IRS

October 31, 1997

The liquidator of Cayman-based Guardian Bank & Trust (in liquidation) has lost a petition he filed against the US government for the return of a computer tape containing details of accounts held at the bank.John Mathewson, the former chairman of the bank, handed over the tape to the FBI in June, 1996, as part of a plea bargain agreement after he was charged with money laundering offences in New Jersey.

Cayman tax initiative – latest

August 28, 1997

Despite overwhelming evidence to the contrary, the UK and Cayman Islands governments are still denying the existence of an initiative from London requesting that Cayman begin co-operating with tax investigations carried out by G7 countries, as was reported last month by Offshore Alert.The ‘does it or doesn't it exist' debate has reached almost farcical proportions, largely as a result of the Foreign & Commonwealth Office in London refusing to discuss the subject in any depth and the Cayman government refusing to discuss the subject at all.

OffshoreAlert’s ‘misconceptions’ about Cayman tax co-operation

August 19, 1997

Letter to OffshoreAlert's editor from Nev Johnson, Press Officer, Foreign and Commonwealth Office trying to coorect "erroneous" rumours about the Cayman Islands being forced to co-operate with tax investigations. It later transpired that the "rumours" were accurate.

Existence of Cayman tax directive confirmed by Cayman sources

July 31, 1997

Offshore Alert can today confirm that the Cayman Islands Governor, John Owen, HAS received a directive from the Foreign and Commonwealth Office in London instructing the island to introduce legislation to assist foreign countries with tax investigations.Yesterday, we ran a story indicating that the directive existed but also quoting senior government and business sources as categorically stating that it did not.Today, after further investigations, Offshore Alert can clear up any confusion and confirm that FCO correspondence seeking co-operation on foreign tax investigations has indeed arrived in Cayman and its existence is well-known in the top echelons of power.

Cayman law allows co-operation for ‘most serious tax offences’, says FCO

July 30, 1997

Letter to OffshoreAlert's editor from Nev Johnson, Press Officer, Foreign and Commonwealth Office concerning news that the Cayman Islands was being forced to co-operate with foreign tax investigations.

UK tax initiative in Cayman

July 30, 1997

Does it exist or doesn't it? That was the question being asked in the Cayman Islands this month after widespread reports that the Foreign and Commonwealth Office in London sent a directive to Governor John Owen instructing Cayman to pass legislation opening up bank accounts for tax investigations carried out by the world's major countries.

Irish authorities seek confidential bank information on Charles Haughey in Cayman

May 28, 1997

The authorities in Ireland were waiting anxiously this week to see if the Grand Court of the Cayman Islands will give them permission to interview Cayman bankers and auditors who may have information about alleged illegal payments to former Irish Prime Minister Charles Haughey.

USA v. Robert Raymond et al: Answers and Counterclaims

April 14, 1997

Answers and Counterclaims by Bob Bernhoft in a civil complaint filed by the USA against Robert R. Raymond and Robert G. Bernhoft, both doing business as Morningstar Consultants, at the U. S. District Court for the Eastern District of Wisconsin.

Mexico acts to curb offshore money transfers

March 24, 1997

The Mexican government has amended the country's tax laws to try to curb the massive outflow of capital being lost to the world's tax havens.

USA v. Robert Raymond et al: Complaint

March 3, 1997

Complaint filed by the USA against Robert R. Raymond and Robert G. Bernhoft, both doing business as Morningstar Consultants, at the U. S. District Court for the Eastern District of Wisconsin.

Colorado couple on the run from US creditors celebrate legal victory in Cayman

February 28, 1997

A Colorado couple on the run from the Internal Revenue Service and a possible prison sentence in the United States have been celebrating a major court victory in the Cayman Islands, whose government has welcomed them with open arms.The Appeals Court of the Cayman Islands reversed an earlier US$721,000 judgment made against Thomas and Sandra Quintin by a lower Cayman court in a case brought by energy giant Philips Petroleum of Oklahoma.

USA v. Daniel Enright et al: Superseding Indictment (‘Tax Fraud’)

August 27, 1996

Superseding Indictment alleging tax fraud and money laundering in USA v. Daniel Enright, Igor Erlikh, Aron Misulovin, Demetrios Karamanos, Richard Pedroni, Richard Santo, David Wasserstrom, Kevin Ginty, Ruslan Erlikh, Aron Chervin, John Ruocco, Ilya Klotsman, Arnold Zeidenfeld, Vadim Brusilovsky, Mary Ingram, Michael Lipkin, Alex Krechmar, Varujan Amroyan, Ilya Gorodetsky, Igor Yusim, Thomas Hampton, Rafail Shirl, and Anatoly Kogan at the U.S. District Court for the District of New Jersey.

Richard Nossen v. International Institute Companies, Inc. et al: Nossen’s Proposed Findings of Fact and Conclusions of Law

February 14, 1996

Richard Nossen's Proposed Findings of Fact and Conclusions of Law in a complaint filed by Richard Nossen against International Institute Companies, Inc., Concept Publishing, Inc., Robert C. Reid, Thomas Azzara, and Eden Press, Inc. at the U. S. District Court for the Eastern District of Virginia.

Richard Nossen v. International Institute Companies, Inc. et al: Amended Complaint

November 24, 1995

Amended Complaint filed by Richard Nossen against International Institute Companies, Inc., Concept Publishing, Inc., Robert C. Reid, Thomas Azzara, and Eden Press, Inc. at the U. S. District Court for the Eastern District of Virginia.

International Institute Companies, Inc. et al v. Eden Press, Inc.: Amended Third-Party Complaint

October 24, 1995

Amended Third-Party Complained filed by International Institute Companies, Inc., Concept Publishing, Inc., Robert C. Reid and Thomas Azzara against Eden Press, Inc. at the U. S. District Court for the Eastern District of Virginia.

Bermuda lawyers Vaucrosson and Hall sued for alleged unpaid taxes

August 10, 1995

Lawyers Julian Hall and Charles Vaucrosson are among 12 defendants who are being sued by the Minister of Finance for a total of $1.05 million in unpaid taxes and fees.The government department has started legal action at Supreme Court to recover money it claims it is owed.