Kenneth Rijock

Kenneth Rijock

Thursday, February 28, 2013

WHERE ARE THE FRAUDSTERS FROM EUROPEAN-AMERICAN BANK TODAY ?


When known fraudsters resurface in another jurisdiction, honest businessmen beware. A decade ago,  A financial institution in Grenada, The European-American International Bank & Trust Company Ltd. failed under mysterious circumstances, and its depositors lost millions of dollars. Inasmuch as I have recently seen some of the names of the participants in the bank's affairs, I am bringing it to your attention.

European-American, when it became insolvent, and was liquidated through the High Court of Grenada, was found to have some major deficiencies, which were reported to the Grenadian regulatory authorities by the Liquidator, in a number of documents that are public:

(1) There was no actual Capitalization, though the figure of $25m was listed by the bank.
(2) Only one of the four directors was ever vetted and approved by the regulators. None of the others submitted sufficient biographical information to be vetted, and one, who had a large claim against him, was asking for a waiver.
(3) There was no Reserve Fund for losses. The bank had no assets, and the deposits were gone.
(4)  The bulk of the bank's deposits were "invested" with a company run by one of the directors; it went out of business, with no assets, and is considered to be a suspected fraud. Its name: New World International Investments Corp.
(5) There was no Due Diligence, or Customer Identification Procedure, performed on the bank's customers.
(6) The bank's account in a Maltese bank had been closed, and its US account frozen by a US Court, in a Federal forfeiture case.


The names of the self-declared "directors" most of which were never approved by regulators:

(A) Raymond Yusi, Managing Director/President
(B) Barry Sturges
(C) David Price

Though some of these are common names, should you have contact with anyone who might be one of these individuals, you are urged to immediately conduct an enhanced Due Diligence investigation upon that person. par particular attention to these names in the Republic of Panama.




Tuesday, February 26, 2013

STANFORD BANK RECEIVER SUES EVERYBODY


Ralph Janvey, the court-appointed receiver in the Stanford International Bank Ltd. case, has brought a Federal civil action* against every major officer and director employed at the Ponzi scheme. for Breach of Fiduciary Duty. The action names the Stanford Chief Compliance officer, its General Counsel, and all the other principal officers and directors.

Some of the 23 others named are below, some of which have already been charged in criminal court:

Executive Director
Treasurer
Chief Marketing Officer
Internal Auditor
Chief Accounting Officer
Chief Investment Officer
President of Mexico Group
President of the Swiss Group
Managing Director for Merchant Banking


These individuals, not charged in the criminal case, who have scattered to the four winds, will now find it a bit difficult to keep their new jobs. This lawsuit makes them a liability to their new employers, not to mention potential damage to the new company's reputation when you are arrested, in the presence of media, at your new desk.

 The moral of the story: if you uncover evidence that indicates that the company where you work is a Ponzi scheme, you need to: (1) resign forthwith, taking your evidence with you (2) employ competent counsel, and (3) with your counsel's advice, cut a deal for immunity, in exchange for your testimony. Do do any less could expose you to civil litigation, and even possible criminal indictment.


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* Ralph Janvey etc. vs. Pablo Alvarado et al, Case No.: 13-cv-0775 (ND TX).

Monday, February 25, 2013

THE LAUNDRY MAN IS BEING PUBLISHED IN POLAND


Readers of this blog who reside in Poland, or who have a reading knowledge of Polish, kindly note that The Laundry Man is now available to them in their own language. The title is Banker Mafii; check with your local bookseller, or favourite online resource, to obtain a copy. I did verify online availability.

There have been some articles in the press in Poland, discussing the book, and I did give an interview, which I see has been posted to the Internet. 

ANTIGUA NAMED IN SECOND FEDERAL LAWSUIT BY STANFORD INVESTORS



The Government of Antigua also faces additional allegations of rampant official misconduct in a United States courtroom. The Stanford Investors Committee, as assignee of the Receiver, has filed a second action in US District Court in Texas, against Antigua & Barbuda, which may owe as much as $240m, in unpaid loans, extensions of credit, and other payments, to the court-appointed Receiver in the Stanford case. Anyone who is reviewing the other case that I reported on this weekend*, should also examine this civil suit as well.

The allegations are, frankly, scathing, especially involving former Antiguan regulatory chief, Leroy King, who reportedly has first-hand knowledge of governmental corruption in Antigua, at the highest level, which the country's leadership fears he will disclose, if extradited to Texas at trial. Antigua will suffer major reputation damage when the media detail all the corruption alleged by the plaintiff.


Amongst the claims:

(A) That the Government of Antigua was an integral component of Stanford's fraudulent enterprise.
(B) That Antigua obstructed the SEC investigation
(C) That Antigua, which lacked creditworthiness, took an estimated $90m in loans from Stanford, which were actually investors' CD money. none were ever repaid, or restructured.
(D) Stanford and Antigua were "blood brothers" in the Ponzi scheme.

The causes of action listed in the Complaint:

(1) Breach of Contract.
(2) Anticipatory Breach of Contract.
(3) Recovery of Fraudulent Transfers.
(4) Aiding, Abetting or Participation in a Fraudulent Scheme.
(5) Aiding, Abetting and Participation in Breach of Fiduciary Duty.
(6) Violations of the Texas Securities Act.

The case has been transferred, for probable consolidation with one or more of the other related actions. We shall be reporting upon the allegations contained in the third civil suit shortly.
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* Official Stanford Investors Committee vs. Bank of Antigua, et al, Case No.: 13-cv-0762-N (ND TX).

RAISE COUNTRY RISK ON CUBA

Miguel Diaz-Canal
This weekend's announcement from the Republic of Cuba, that its leader, Raul Castro, will be stepping down after serving his next five-year term, and that his designated replacement will be First Vice-President., Miguel Diaz-Canal, could spell trouble for the regime. Can Diaz-Canal, not known as a reformer, take over from the Castro brothers, who have been in power since 1960 ?


Should Cuba's Communist-inspired government topple, due to a "Latin American Spring," or another type of regime change, corporations in those those European countries that have continued to do business with Cuba could suffer the same fate as United States companies did: a repudiation of Castro-era obligations and business relationships. Now that it is clear that there will not be a Castro in power in Cuba after 2018, an unanticipated regime change could very well occur. It may not be a bloody revolution, but future leaders of Cuba could renege on its obligations, to the damage and detriment of international financial institutions, and multi-national corporations.

For that reason, I have chosen to advise that Country Risk for Cuba be increased at this time.


ANTIGUA AND CARIBBEAN BANKS NAMED IN STANFORD CONVERSION SUIT IN FEDERAL COURT


It is unthinkable that a central bank, and a sovereign state, would be sued in connection with a Ponzi scheme, but in the massive Stanford bank case, all courtesies have been swept aside. The Official Stanford Investors Committee, in apparent coordination with the court-appointed Receiver, Ralph Janvey, has filed a complex civil action* in US District Court in Texas, naming Antigua & Barbuda, the five East Caribbean banks that received possession of portions of the Bank of Antigua, thereby denying those assets to the Receiver, and the Eastern Caribbean Central Bank, which effectuated what the plaintiffs call a "brazen act of thievery." These are strong words, but they appear to fit the objective facts; reportedly, many millions of dollars of assets were allegedly fraudulently transferred, and are now out of the reach of the Receiver, who needs those funds to pay the victims of the Ponzi scheme.

There is also over $200m of debt owed to Stanford bank by Antigua; the "self-serving seizure" of the bank means that Antigua would be paying itself. Antigua allegedly participated in the fraud. Whether there is foreign sovereign immunity for Antigua, in this case, is an interesting issue that will certainly be explored and decided in advance of any trial.


The named banking defendants are;

Antigua Commercial Bank
St. Kitts-Nevis-Anguilla National Bank Ltd.
Eastern Caribbean Financial Holding Company Ltd.
National Commercial Bank Ltd.
National Bank of Dominica Ltd.

The claims for relief:

(1) Avoidance of Foreign Transfers to the Bank of Antigua
(2) Avoidance of Fraudulent Transfers, by Seizure of the Bank of Antigua.
(3) Conversion.
(4) Unjust Enrichment.
(5) An Accounting from the Bank of Antigua.
(6) An Accounting from the ECCB, as to the value of the Bank of Antigua.
This is only one of three major cases filed; we shall detail the others during this coming week. Remember, Antigua has never extradited its principal regulator, Leroy King, to face criminal charges in the US; these new civil suits, on top of that fact, could seriously affect the flow of business to Antigua's offshore financial services sector, and it will certainly result in increased Country Risk.

Could this new litigation actually threaten Antigua's fragile economy ? We cannot say, but I would certainly think that the country's leadership must be experiencing the legal equivalent of "Shock & Awe" this month.
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* The Official Stanford Investors Committee vs. Antigua & Barbuda, et al, Case No.: 13-cv-0762-N (ND TX).

Sunday, February 24, 2013

CONVICTED FRAUDSTER AT LARGE IN PANAMA


The Dutch convicted and sentenced fraudster, Okke Ornstein, remains at large in the Republic of Panama, and you are advised to contact the authorities should you encounter him. Ornstein, who was the former general manager of convicted Ponzi schemer and money launderer, Marc Harris, threatened, in writing, to take the life of Harris, in an extortion scam. He is also linked to an unsolved murder in Panama City, and another death threat delivered in Panama City. In short, his is not the kind of individual you want to walk down a dark street with. Ornstein fled to Panama during a criminal investigation of his involvement in child pornography in the Netherlands.

When apprehended, Ornstein will begin serving a twenty month sentence in one case, and 24 months another case, both in a Panamanian prison not known for its amenities.

MASSACHUSETTS SUPREME JUDICIAL COURT OPINION PUBLISHED IN MICHAEL BURNBAUM CASE



The Massachusetts Board of Bar Overseers has published the extensive opinion, of the Supreme Judicial Court of Massachusetts, regarding the suspension of former Miami defence attorney Michael Burnbaum. Readers who have been following this case on these pages can find it here:

(1) Go to http://www.mass.gov/obcbbo/
(2) Select " Disciplinary Decisions since 1999."from the options on the left-hand side.
(3) Select the letter "B" and scroll down until you find the decision.

The Court, speaking through Justice Lenk, rejected all of Burnbaum's counsel's arguments as to why the starting date for any suspension imposed upon him for his Federal cocaine trafficking conviction should be the date of his original conviction, and not 2013, and was particularly bothered by the fact that he undertook to represent a defendant in a Federal criminal proceeding in New York, where he stated that he had no pending disciplinary proceedings filed against him.


Apparently the three year suspension ordered by the Court has been appealed by the Massachusetts Bar; they obviously want a more substantial sanction, as he failed to notify Massachusetts of his conviction, and of his resignation from the Florida Bar, under disciplinary circumstances, a violation of the Mass rules governing attorneys.

We shall continue to follow this appeal; meanwhile, Burnbaum's license to practise law remains suspended.

Saturday, February 23, 2013

MASTER ADVANCE FEE FRAUDSTER "STEVEN DEAN KENNEDY" SUED AGAIN, THIS TIME IN ARIZONA


An Arizona construction company appears to have been the latest victim of the fraudster who uses the alias Steven Dean Kennedy," and dangles promises to find funding in front of businesses. He always gets a large deposit, which he generally keeps. A civil suit has been filed, in Federal Court in Phoenix*, on behalf of AP Southwest LLC, an apparent subsidiary of a Minnesota construction firm, against Kennedy, his long-time associate Mark Creighton, and his latest shell company, together with ten unspecified co-conspirators.

Remember, Kennedy's scam is an advance fee scheme wrapped inside a Ponzi scheme. He claims that he can "leverage" the victim's money through a mysterious thirteen billion dollar family bond asset; he even hints that he is a part of the famous Massachusetts Kennedy family. Of course, it is sheer fiction. Sometimes, he repays a portion of the deposit, which was conveniently liberated from escrow by one of his attorneys, from the next victim; That is the Ponzi aspect.

The plaintiff deposited $200,000 with Kennedy's latest bogus entity, CAPITAL TRUST FUNDING, INC., which he moved to when his original vehicle, ATLANTIC RIM FUNDING INC. sustained a multi-million dollar punitive damages judgment in a Federal Court case, for failing to refund the "guaranteed"deposit, as promised. Kennedy also failed to deliver the "high-yield trading program" returns; I doubt that the plaintiff's attorney will be able to find these fraudsters, they are good at their game. They strike, they move on.

My problem with this case, and all the others, is that nobody performed even the most rudimentary due diligence upon Kennedy or his company. Even a simple web search for Kennedy and Capital would have turned up my half dozen articles on the federal litigation, and the Mortgage Grapevine website, wherein many of the victims detail their sad stories. Why didn't the plaintiff company consult with its attorneys before engaging in the transaction ? A lawyer would have found several lawsuits against Kennedy in five minutes. I can never understand why any business fails to check out any prospective business partner, client, vendor, or foreign agent.

I also wonder why no lawyer for AP participated in drafting the so-called Deposit Guarantee Agreement, between the parties. Mark Creighton executed the agreement, not in the representative capacity of officer or director, but as "Managing Principal," which anyone who paid attention at university knows, is not a valid title in the United States. Why was this error not caught by the AP leadership ? The defendants, of course, had legal counsel: Arthur Fillmore, Esq., of Leawood, Kansas**. Mr. Fillmore was the addressee on the plaintiff's demand letter, requesting the return of their $200,000 .

I doubt whether the plaintiff can recover a dime here; I have not seen where anyone else who filed suit was successful in getting their client's money back. A final note; there is serious law enforcement interest in these fraudsters, and you can expect criminal charges to be filed eventually. I hope that it is sooner rather than later; Mr. "Kennedy" has ruined several small companies. He deserves a long stretch in custody, after conviction by a jury of his peers, as a guest of the US Bureau of Prisons, perhaps in some upper-level penal institution, with some unhappy Colombian narcotics kingpins as cellmates.


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*AP Southwest LLC vs. Capital Trust Funding, Inc,  Steven Dean Kennedy, Mark T. Creighton et al,
Case No.: 12-cv-002610NVW (D Ariz).
** Leawood is next door to Overland Park, Kansas, which followers of the Kennedy cases will remember is where Jada Jordan is involved in a local company, and who repeatedly recommended Kennedy and his original company, the now-insolvent and defunct Atlantic Rim Funding, Inc., on the Mortgage Grapevine. Ms. Jordan is reportedly the ex-wife of Duane Jordan, another veteran Kennedy associate.


Friday, February 22, 2013

WHERE WAS COMPLIANCE WHEN ALL THESE CASH WITHDRAWALS WERE BEING MADE ?


A civil suit, filed in state court in Miami*, against Wells Fargo, as the successor in interest to the defunct Wachovia Bank, reportedly alleges that the operator of a $29m gold bullion Ponzi scheme, since convicted and imprisoned, was given carte blanche by a Wachovia bank branch manager to withdraw cash at will. The banker, Corey Daniels, has also been named as a party defendant.

What amazes me is the allegation that the Ponzi schemer made seventy cash withdrawals, each of seven or eight thousand dollars, and the bank failed to consider that these were suspicious and/or reportable transactions. The Ponzi schemer's subsequent $2m deposit, and a cash withdrawal of $950,000 , sounds like a question from a compliance examination. Was the account deemed so valuable by the branch manager that he ignored these red flags ? Let us hope that he has chosen to leave the financial industry.

Suit was only recently filed, but I intend to monitor its progress, and will report back to you on all developments as they occur. Suits against bankers for compliance malpractise always get my attention.
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Daniel Stermer vs. Walls Fargo (NA) et al, Case No.: 13-3680-CA-01 (Miami Dade Co. Cir. Ct.)

Thursday, February 21, 2013

VIKTOR BOUT REQUESTS ORAL ARGUMENT IN HIS APPEAL


Albert Dayan, the attorney of record for convicted arms trafficker Viktor Bout, has notified the Second Circuit Court of Appeals that he desires to be heard on Oral Argument, for his client's appeal.  Though not available as a matter of right, should the Court decline to set the case for Oral Argument, Mr. Dayan would then be allowed to advise the Court, in writing, that :

(1) The appeal is not frivolous.
(2) The issues have been authoritatively decided.
(3) The issues can be resolved by reference to the briefs and appendices.

We trust that the Second Circuit chooses to allow him to argue the issues that he has presented in the appeal, as they are of great public interest.

THE SYRIAN CIVIL WAR SPREADS TO LEBANON


It may be time to raise Country Risk on Lebanon again. Hezbollah, who has been fighting on the side of the Damascus regime inside Syria, and suffering casualties there, has begun firing artillery against the Free Syrian Army (FSA) from batteries located inside Lebanese territory, in the Bekaa Valley.

The FSA has given Hezbollah until today (Thursday) to cease and desist, but it is doubtful that this will occur, and it has promised to take the conflict to Lebanon. Given the inability of the Government of Lebanon to reign in Hezbollah, the civil war in Syria* may very well spill over into Lebanon later this week. In that event, Country Risk for Lebanon will certainly be increased.

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* Remember also the recent death, at the hands of Syrian Opposition forces, of an Iranian IRGC general, operating under an alias, who was working with Hezbollah in Lebanon. Syria blamed Israel for the attack.


Wednesday, February 20, 2013

WHERE WILL BULK CASH SMUGGLERS GO, NOW THAT EGYPT HAS FLOODED GAZA'S TUNNELS ?


Egyptian security forces, said to be still smarting from the deaths of sixteen soldiers last year, have initiated a campaign to flood the estimated one hundred illegal tunnels, through which Hamas smuggles bulk cash and missile parts, amongst other things, under the Egyptian-Gaza frontier. The question arises: how will Hamas agents, who bulk cash smuggle US Dollars into their Palestinian Territory, now move cash into Gaza ?

Egypt has been diverting sewage water directly into the tunnels, forcing the small army of professional smugglers to beat a hasty retreat, and the government's campaign shows no sign of letting up, until the maze of tunnels that honeycomb the frontier are destroyed. Smugglers who attempt to reopen their prized tunnel have found that Egyptian forces will flood it again, as necessary, to shut down the illicit traffic.

Bankers may find this humourous, but rest assured, the supervisors of the bulk cash smugglers who provide illicit currency to Hamas, through these tunnels, will not be not amused. Moreover, they will be looking for alternative routes into Gaza. Therefore, be alert for any new or unusual activities, such as:

(1) Increased funding by NGOs, charities, or any other entity that operates inside Gaza.

(2) Increased requests for US Dollar notes inside Israel, for an unspecified purpose. Gaza has a long frontier with the State of Israel. Are there any weak points ?

(3) Increased dollar cash movement inside the West Bank. Bulk cash smugglers can be extremely imaginative under high-stress conditions. Are there any other novel ways to move currency into Gaza ?

(4) Increased wire transfers directly into banks with Gaza branches.

Flooded smuggling tunnel


The smugglers will find a way to bring the currency into Gaza; just make sure that it is not at your bank's expense, for Hamas is a Specially Designated Global Terrorist (SDGT) organisation, and you do not need to incur a very public OFAC fine, as well as become a target for terrorist financing, if you are not paying attention.



HUGO CHAVEZ: DEAD, ALIVE OR A VEGETABLE ?

When was this photo taken ? 

The 2 AM secret return of Venezuela's President Hugo Chavez to his native Venezuela sounds like something from a spy novel; no witnesses to confirm his arrival, no photographs taken of the prominent leader, in short, nothing to verify that he actually did return, or if he did, whether he is competent to resume his presidential duties. His aides say that he cannot speak, due to medical procedures performed upon him; since they generally have a problem with the truth, what else are they not telling us ?



You say those photos taken with his family prove that he is alive, and of sound mind ? The Cuban DGI  is known to be extremely competent with the planting of disinformation. Digital alterations of photographs can be performed by anyone with Photoshop or an equivalent programme on their laptop. 



The photo below is making the rounds; is it the ill, or even deceased, Chavez, in a Havana hospital ? We cannot say, but we would surely like to see someone take a photo in Caracas, of Chavez, in public, for once. Venezuela will remain mired in economic and political chaos until the presidential succession, through a free and fair election (not a rigged one, please, like Chavez did several times) occurs.

???
A final note, where on earth is the Venezuelan Opposition, the one group who can expose this fraud, and allow the country to move on ?



  

Tuesday, February 19, 2013

WAS YOUR NEW COMPLIANCE HIRE INVOLVED IN A PONZI SCHEME ?



I recently noticed, to my amazement and distress, that a senior compliance officer, who formerly worked at a bank accused of facilitating the Ponzi scheme run by Florida Attorney Scott Rothstein, was now working at a firm that conducts audits of financial institutions. Whilst most compliance officers at banks that practise "tunnel vision," and allow huge amounts of money to come into accounts of customers, without adequate AML, do not get indicted when the house of cards comes down, with the Ponzi scheme, those individuals failed in their roles as gatekeepers, and you do not want them in your shop.

Let me suggest that, when checking out new hires, you enquire as to all their former banking positions. I know that you check out the applicants, but you also need to check out the banks where they worked:

(1) Did any of the banks where they worked bank Ponzi schemers whilst they were employed there ?

(2) What was the job title and responsibility of the applicant at that bank ?

(3) was the bank sued in civil court for facilitating the Ponzi scheme ? Criminal charges ?

(4) Did your applicant have any involvement with the accounts of the Ponzi schemer ?



Please, do not employ anyone who knowingly facilitated a large and continuing Ponzi scheme where they previously worked. That individual may later be indicted for their involvement in the fraud. Also, if he failed in his role as a gatekeeper, he or she may do the same thing at your bank; be careful.

KEN RIJOCK LECTURE NEXT WEEK AT FFIEC



If you work for the OCC, NCUA, ITS, FRB, or one of the state regulatory agencies, and you are attending the Financial Crimes Seminar, sponsored by the FFIEC, next week, you will see me there on the  27th of February, from 2:15 to 5:00 PM, lecturing on money laundering. The seminar is held at the FDIC Seidman Center in Arlington, Virginia.

My other 2013 lecture dates there are 14 August and 2 October, at the subsequent Financial Crimes Seminars.

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*http://www.ffiec.gov

Monday, February 18, 2013

MONDAY IS PRESIDENTS DAY IN US



Readers please note that Monday, 18 February is a legal (banking) holiday in the United States, being known as Presidents Day. The birthdays of Presidents George Washington and Abraham Lincoln both occur in February, but only Washington's was a legal federal holiday. Today, a generic holiday is observed, honouring all American Presidents. Most businesses also close on this day.


Friday, February 15, 2013

IS MAN WITH 300m BOLIVAR CHEQUE IRAN'S PRIMARY MONEY LAUNDERER ?


Tahmasb Mazaheri, the former Governor of the Central Bank of Iran who was caught with the infamous three hundred million Bolivar Cheque in Germany, is not just a former senior government official. He is also the director of record of a Venezuelan bank cleverly organised with a name that is deceptively similar to one of the Western Hemisphere's most prominent institutions, the Inter-American Development Bank. That is a classic money laundering tactic, used by yours truly many times. So the question arises, is Mazaheri the kingpin of the Iranian money launderers ?

The Venezuelan-Iranian front bank, which was immediately sanctioned by the United States, does NOT serve the Venezuelan public. It is an obvious facilitator of Iranian sanctions evasion, and money laundering activity. I have seen the corporate documents; it was formed in record time, and does not appear to play a role in the Venezuelan domestic banking system.

What about Mazaheri ? It is reported that the German customs officials did not arrest him. He does face a $1.4m  fine, but it is understood that he is now back in Iran. And the infamous cheque, reportedly signed, in Iran, by a yet-unnamed director of the government-owned Bank of Venezuela; who was the payee, and why won't German officials release a copy ? Far too many unanswered questions for Germany. They can do better than that. 

Thursday, February 14, 2013

PONZI SCHEMER'S JEWELERS SETTLE WITH TRUSTEE FOR $650,000



Whatever business you are in, if you do business with a Ponzi schemer, the court-appointed professionals who are later charged with accumulating assets for the victims will be coming after you. The jewelers who sold Scott Rothstein more than $10m in jewelry, watches and other luxury items have settled with the bankruptcy trustee for Rothstein's law firm for $650,000 .

The original claim was for more than ten million dollars. This case is a perfect illustration of the fact that all businesses must have an effective compliance department, capable of detecting possible financial crime, and identifying high-risk clients, whom it may choose to exit, based upon compliance recommendations. Compliance is a valuable tool in minimising business risk; it is no longer smart to seek to cut costs by declining to create a compliance function, at those businesses where the law does not mandate such a programme.

Had an experienced compliance officer, working for the jewelry firm, checked out the Rothstein law firm's volume of litigation, using publicly-available online court resources, they might have noticed something, whether it was the Ponzi schemer's lack of court appearances,(which were noticed by other lawyers), or some other red flag. Such suspicious activities, which require follow-up, could have alerted the jeweler to the danger.

Simply put, you avoid compliance at your peril.

Wednesday, February 13, 2013

HAMAS CREATES ITS OWN NEWS AGENCY



When performing due diligence investigations, you are advised that any information that you may retrieve from Al Rai Agency, located in Gaza, may be more propaganda than truth. Al Rai is the newly-created official  new agency of Hamas, and the announcements regarding it indicate that it shall follow the "official government line" on news and events.

Whilst you may use it to confirm general information about Gaza, it is doubtful that it will explore any topics involving corruption of government officials, money laundering, or bulk cash smuggling, all of which constitute serious issues in Gaza. You can expect mainly positive spins on Gaza politics, but details of Gaza PEPs may not be accurate, and may contain disinformation. You are advised to search elsewhere, if you want objectivity.


Tuesday, February 12, 2013

IRANIAN COMPANY WITH 300M CHEQUE OWNS BELPARS


My story on the 300m Bolivar cheque*, seized by German Customs authorities from a powerful Iranian PEP, purportedly working for Kayson Company in Venezuela, has spawned a  number of comments on the company's other suspected money laundering activities for Iran. As the result, I have a lot of questions about the company's money laundering, and also about Iranian oil sales through Belarus:


(1) According to a little bird in the Channel Islands, Kayson is the majority shareholder of a Jersey company called Belpars Petroleum Company Ltd., which ostensibly operates in Belarus. The problem is that public sources state that the National Iranian Oil Company, and/or PetroIran Development company own that 51%. Is the Kayson ownership concealed from public view, because Belpars is laundering Iranian funds, or assisting in international sanctions evasion, or both ? Where are the usually efficient Jersey regulators on this obvious sanctions evasion ?


(2) Is the €200m Kayson-funded Belpars construction of a hotel, known as the Magnet Minsk, providing cover for the sale of Iranian oil through Belarus ? One public source mentioned a €500m cash injection into Belpars by Kayson. Where are all these Euros coming from, I wonder ?


Artist's conception
(3) Why is Esfandiar Rahim Mashael linked to both companies ? He is the influential Chief of Staff to Ahmadinejad, and could be Iran's next president, according to Iranian expats who have identified him in connection with Kayson.

Mashael
(4) Just how much is Belarus aiding and abetting Iran, assisting it in sanctions evasion, and money laundering ?

(5) Exactly how does Kayson Company, SA,  the Venezuelan subsidiary, figure in the sanctions evasion activity ?

I will continue to probe Kayson, its Venezuelan clone, and Belpars; stay tuned.
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*  Iran lies about the 300m Cheque Seized in Germany

RUMOURS FLY OF A SECOND DEVALUATION OF THE VENEZUELAN BOLIVAR


According to a knowledgeable financial adviser in Caracas, a decision has already been made, by the Government of Venezuela, to devalue the Bolivar a second time. The Bolivar Fuerte (BsF), the currency of the realm in Venezuela, was devalued thirty-two percent recently, but this reportedly was insufficient to restore the failing economy.


Given the financial and political chaos occurring at this time in Venezuela, compliance officers at international banks whose customers are engaged in ongoing trade with Venezuelan firms should ensure that their exposure is minimised, and that the bank not incur any new exposure whilst fiscal instability appears to be the order of the day. If you have not already done so, raise Country Risk to High.