WHEN WILL PANAMA PUBLISH PHOTOS OF ITS 50+ KNOWN MONEY LAUNDERERS ?

This is a wanted poster, published by the Government of Nigeria, of a large number of Boko Haram terrorists' the images were taken from screenshots of BH actions. I am wondering: since the Government of the Republic of Panama knows quite well who the Panamanian and Venezuelan money launderers are, who ply their dark trade in Panama City, perhaps it can post a set of photos, for the benefit of the banking industry in North America, which does not want any of them coming in to its banks, and would sincerely like to know who the players are.

The problem of widespread money laundering, through Panama's "see-no-evil" financial institutions just will not go away, as the government chooses to support the financial services industry, and to simply no charge laundrymen with their crimes. It knows exactly who they are; I challenge it to post their photographs.

FIFTH CIRCUIT AFFIRMS PONZI SCHEMER ALLEN STANFORD'S CONVICTION

The convicted Ponzi schemer, Sir Allen Stanford, will continue to serve his 110-year sentence, for the Fifth Circuit Court of Appeals has affirmed his conviction. Court observers who follow cases involving Ponzi schemers were not surprised, most of his appellate issues appeared to have any merit at law, and at times, they seemed to be more like angry rhetoric than well-reasoned argument.

Stanford was convicted on multiple courts, including wire fraud, mail fraud, money laundering conspiracy, and obstruction of an investigation. The Court, in essence, held, in a 19-page opinion:

(1) The trial court had jurisdiction.
(2) The indictment was legally sufficient.
(3) It was not reversible error to deny the defendant a continuance.
(4) There was no valid double jeopardy issue.
(5) The trial court did not err in denying his motion to suppress evidence, on 4th Amendment  grounds.
(6  The Court's response to a jury note was harmless error.
(7) The application of sentencing enhancements was supported by the evidence.
(8) The trial judge was not partial to the government at the trial.
(9)  The Cumulative Error Doctrine does not apply.
(10) There were no Brady issues, the government did not withhold exculpatory information.

Readers who wish to review the complete text of the opinion may access it on the Fifth Circuit website, as it has been posted there. It is the first decision on the list:
http://www.ca5.uscourts.gov/electronic-case-filing/case-information/current-opinions

YET ANOTHER DISHONEST PANAMANIAN LAWYER CONNECTS WITH ALCIDES BARTOLO PENA

Corrupt Panama attorney José Luis Garcia Sánchez

This is José Luis Garcia Sánchez, a lawyer working in the Republic of Panama; he demonstrates why attorneys there, unless they work at a law firm with sound ethical principles, are not trusted, and with good reason. You may want to pass this article on to anyone considering either purchasing residential real estate in Panama for investment, or retiring there.

 Attorney Garcia served two years in prison, for stealing six figures from an American client from Texas. After his release, he went right back to work, for Panama has no functioning lawyer disciplinary system; it requires only graduation from a recognized law school to practice law, there is no bar exam, and no ethics section to pass, before one can be admitted.

After leaving prison, Attorney Garcia went right back to the practice of law, including his old tricks, taking fees, but not doing the work he agreed to perform for his clients. Inasmuch as the court system is inefficient, and totally corrupt, meaning that justice can be delayed, or denied, for a price. Attorneys who cross the line are never punished.

His biggest mistake: While representing a client who had multiple claims against the American fraudster we have chosen to call "the Bill Cosby of Panama," due to his actions, the sexual predator, Gary James Lundgren. Sr. Garcia sold his client out to Lundgren's lawyer, Alcides Bartolo Peña Araya, who has paid him handsomely for his betrayal.

Garcia deliberately failed to make required filings, missed court dates, dragged his feet whenever possible, and in general insured that justice would never be served for his client, as his acceptance of regular bribes from Peña insured that the case would go nowhere. His deception has now been discovered, and his "services" terminated. He has violated the most sacred tenet of the law: to zealously represent your client, and he belongs back in prison.

Unfortunately, the bar of Panama is full of such corrupt types; all hustling for money, at the expense of their trusting clients. Unless you retain a top-flight lawyer, in a reputable firm with ethics that they expect their partners to adhere to, you may end up with someone like José Luis Garcia Sánchez, who will collude with someone like Alcides Bartolo Peña Araya, and you will lose your case. Watch yourself in Panama, for it is full of snakes with law licenses.

OFFICERS FAILED TO LIQUIDATE DUNDEE BANK, STILL OPERATING IT UNDERGROUND

Investigations into the Cayman Gang of Four trading scandal have uncovered the fact that, notwithstanding an order from Canadian regulators to close and liquidate Dundee Merchant Bank, which is also known as Dundee Bank, senior officers at the bank deliberately and intentionally failed to close down operations, and are currently running it covertly, in violation of Cayman Islands law.

You may recall that we have previously disclosed that the bank has only a "B" class license, which mandated that it could operate only if it was the subsidiary of an operating international bank. When Dundee Bank of Canada was sold, Dundee Merchant Bank was no longer qualified to operate in Grand Cayman, and Derek Buntain, its president, and Sharon Lexa Lamb, its senior vice president, were tasked, by Dundee Corporation, the holding company in Canada, to undertake the liquidation, return funds to customers, close the bank's physical operations down.

Derek Buntain, far right.

Reportedly, all the necessary documentation was executed by Dundee Corporation, and delivered to Buntain and Lamb, but curiously, they failed to commence the liquidation.  What role their use of the bank's accounts at other financial institutions has played in the massive $450m trading scam, involving Bateman Financial and B & C Capital, Ltd., is not known, but it is alleged that the Gang of Four were able to facilitate Ryan Bateman's rogue trading operation, through those accounts.

Rumors floating around Grand Cayman claim that Mr. Buntain, who is currently in hiding at his son's house in Prince Edward Island, in Canada, and Miss Lamb, who works at B & C Capital, have planned to take the millions that they have stolen from investors, and permanently relocate, without ever completing the bank liquidation. Such an act could result in the filing, in Canada, of both civil & criminal charges against Dundee Corporation, and its senior management, who, according to William Tynkaluk, have had no dealings with Dundee Bank, believing it already liquidated, and without assets or liabilities.

Will Derek Buntain & Sharon Lexa Lamb, the Gang of Four's own Bonnie & Clyde, take the money and run, or will law enforcement head them off at the pass ? Stay tuned.

INVESTMENT ADVISER TO ROTHSTEIN VICTIMS SENTENCED TO 2.5 YEARS IN FEDERAL PRISON

Michael Szafranski, the investment adviser who was supposed to perform independent verification upon Scott Rothstein's bogus sexual harassment and employee discrimination cases, but who took illegal fees from Rothstein, and failed to conduct the most elementary due diligence, to protect his clients, was sentenced this week to 2 1/2 years in Federal Prison. Szafranski, who entered a guilty plea to a single court, violated his duty to his clients, when he knew that some sort of fraud was involved, and facilitated investments, though he may not have been aware of the exact details of the billion dollar Ponzi scheme.

It is believed that Szafranski's willingness to testify against a former senior officer at TD Bank led to that individual's change of plea, and for that reason, his sentence was relatively short, due to his substantial assistance. Some of the victims may consider his sentence to be inadequate, but he did disgorge the profits he made, for his participation in the fraud.   

FEDERAL JUDGE DENIES VIKTOR BOUT A NEW TRIAL

The trial judge in the Federal criminal case against arms trafficker Viktor Bout has entered an order denying his motion for a new trial, based upon newly-discovered evidence. the Court, in a 26 page ruling, held that the information Bout's attorneys had presented in their motion did not meet the well-established requirements for a new trial, as a matter of law; The movant did not meet the high standard the law imposes.  

The judge, who also denied his request for an evidentiary hearing, responded in detail to every item of evidence that Bout's counsel had presented, in support of the motion. Many Russian observers have accused the United States of entrapping Bout into engaging in criminal conduct with undercover US Government agents, and public opinion in Russia believes that his case was purely political.

Further complicating the issues is that fact that Bout, as well as his associate, convicted sanctions violator, Richard Chichakli, had a working relationship with American intelligence services, though the details remain classified.

Bout's conviction was previously affirmed by the Second Circuit Court of Appeals, and prior counsel failed to seek Certiorari from the US Supreme Court. Was the motion for a new trial actually a ploy, by current counsel, to get the case back before the appeals court ? We cannot say, but we will advise if and when an appeal of this ruling is filed.

PANAMA'S DOWNTOWN BUILDING BOOM WAS FUELED BY NARCO-PROFITS

Construction in Panama

Visitors to Panama City in recent years have been astounded by the frantic pace of growth of new condominiums and office buildings; the only place where I have seen more cranes and derricks, in one place, was Dubai at the height of its construction boom, a couple of years ago. It is the story behind all those gleaming new high-rise buildings that is of relevant interest to compliance officers.

As we all know, North American consumers continue to throw their disposable cash at street-level drug dealers, which results in a multi-billion dollar industry for Colombian traffickers. Though money launderers working for the cartels can easily deposit their clients' narco-profits in many of Panama's banks, particularly those owned or controlled by the country's largest organized crime syndicate, a good laundryman wants his customers' funds cleaned, not just deposited in dodgy banks.

Therefore, their attention was drawn to the rapidly expanding Panama City construction boom, and the dozen or so builders who were actively operating there. Construction costs in Panama ( i.e. labor, materials, building permits, necessary bribes and kickbacks, and even the purchase of vacant land) are traditionally paid in cash, and receipts are rarely, if ever, tendered. The laundrymen had found their niche.

The method was quite simple:

(1) The laundrymen delivered sacks of US Dollars, generally many millions, to the builders.
(2) The builders used the cash to pay for the land, to pay their employees, on payday, twice a month, and to pay for materials, as well as necessary "grease" payments, to facilitate licenses and permits.
(3) After the building was completed, the builder would convey an agreed number of office and residential condominium units to Panama corporations (yes, with bearer shares, of course).
(4) Representatives of the traffickers would later sell the units to legitimate purchasers, especially North American and European expats moving to Panama, the sales proceeds, which came from the buyers, having effectively cleaned the traffickers' drug profits.

US law enforcement agencies are well aware of the identities of those builders; in fact, there is, reportedly, a comprehensive list of those builders, and their companies, maintained by the US Drug Enforcement Administration (DEA). Unfortunately, prior governments in the Republic of Panama have declined to be of assistance in American narcotics investigations of these builders, and even interfered with efforts to acquire sufficient evidence to bring indictments in the USA. For that reason, the United States seems to have ruefully settled for merely monitoring the individuals involved; whether it will ever step up, considering the probable diplomatic consequences, is doubtful.

Gary Lundgren

A large number of money launderers, Colombian and Venezuelan, have been engaged in this dark activity. Many of them are well known, including one we recently profiled, the American expat/money launderer, Gary Lundgren, whose huge real estate empire was accumulated, in large part, by his active participation in the scheme. The former President of Panama, Ricardo Martinelli, who laundered drug profits being smuggled in by the pyramid scheme "superstar," David Murcia Guzmán, also played a major role.

It all boils down to one fact: there's nobody indicting Panama's approximately fifty known, active money launderers, who have been engaged in the cash-for-condo scheme I have detailed here, and unless they are arrested, they will continue to fund major construction projects in Panama. Perhaps law enforcement agencies from the United States can start by charging Martinelli and Lundgren.

Ricardo Martinelli

  

DISTRICT COURT SETS HEARING FOR VIKTOR BOUT REGARDING ADMISSION OF RELEASE OF UN SANCTIONS

Viktor Bout's Russian-American attorney, Alexey Tarasov, has filed a letter with the the sentencing judge in Bout's case, seeking what was styled as a pre-motion hearing, for a ruling that would allow him to request that the Court will take judicial notice of the cancellation of United Nations sanctions previously pending against the defendant. The District Judge has sent the matter for November 2, 2015. Inasmuch as no motion has been approved for filing, there has been no response from the US Attorney's office in New York.

 Bout is seeking a new trial, based upon newly-discovered evidence, and his argument is that United Nations Resolution 2237, entered September 2, 2015, which removed UN sanctions associated with the civil war in Liberia, and included a lifting of economic & travel sanctions against him, is relevant to this pending motion. Inasmuch as the Court has required that any motion to supplement the existing record be heard in advance, the hearing is necessary.

After he lost his appeal to the Second Circuit, Mr. Bout's attorneys moved for a new trial, based upon newly-discovered evidence that was not known at the time of trial. We have previously covered this case in detail, including the ground for the motion, and readers are invited to review the prior posting on this blog, for the details.

HOW AN AMERICAN STOCKBROKER LAUNDERED COLOMBIAN DRUG PROFITS INTO BANK OF AMERICA

His name is Gary Lundgren*, an Alaskan stockbroker who abruptly left the state of Washington after a sexual harassment was filed against him there. He landed in the Republic of Panama, and was soon seen to have large amounts of US Dollars in his possession. The cash was Colombian drug profits, obtained due to a family connection to a major drug organization operating there (Perez).

His problem was, how to launder that money ? While he could easily deposit it into any one of a number of "see-no-evil" Panamanian banks, his clients wanted that money cleaned, and invested in the United States. How would he circumvent the AML compliance programs in place at American financial institutions ? Any large deposits coming from Panama would be immediately flagged for Source of Funds and Beneficial Ownership questions, and he could not easily explain huge deposits.

To make matters worse, Lundgren had no securities license in Panama, so he could not purchase stocks for front companies controlled by the drug trafickers. He needed to satisfy his clients, who demanded a solution from him, and are not known for patience.

His solution: to lend out the cash to newly-arrived residents, all Americans, Canadians and Europeans, who needed local financing to buy real estate, residential condominiums mainly, and direct them to make their monthly payments into the Washington bank account of his American brokerage house, Interpacific Investors Services, Inc. at the local Bank of America branch, at 203 Kirkland Avenue, in Kirkland, Washington.

These payments, from a wide variety of his clients, would not trigger any alarms, because the remitters were all legitimate individuals, and the amounts each not large enough to draw compliance attention at B of A. Of course, one wonders why the bank's compliance department did not see those payments as an artful form of structuring.

Gary Lundgren, and his wife, Griselda Perez

Once the money was in the Interpacific account, Lundgren could purchase securities in the name of any front men, or corporate entities, that he chose. It is his company, and he has a grown daughter working there, who will not be easily identified as such, due to a different last name. Lundgren is believed to be under criminal investigation, including by the Securities & Exchange Commission, for securities fraud, and selling unregistered securities, through front men, and he curiously has refrained from entering the United States for several years.

Since Ricardo Martinelli is no longer the President of Panama, Lundgren no longer benefits from his protection; will he now be extradited to face justice in the United States, or will he continue to operate his laundry in Panama ?
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* Also known as Gary James Lundgren. His attorney, who assisted him in all his money laundering ventures, is Alcides Bartolo Peña Araya, whom we have previously profiled on this blog.

WHY IS CAYMAN'S DUNDEE MERCHANT BANK, SUPPOSEDLY IN LIQUIDATION, OPERATING IN CANADA ?

A victim of the $450m trading scam, operated by a group of fraudsters known to the media as the Cayman Gang of Four, recently received a curious letter. Though it was sent by Dundee Merchant Bank, of the Cayman Islands, it contained a downtown Toronto address. Canadian readers know that Dundee Merchant Bank, which also traded as Dundee Bank, went into involuntary liquidation in Grand Cayman, a couple of years ago. So what's the story here ? Dundee Merchant Bank's small office in Grand Cayman has been closed for years. Is the bank open in Canada ?

The letter, received last week, was backdated to December, 2014, and it discussed the victim's investment account. Dundee Merchant Bank is believed to have been ordered liquidated by Canadian regulators, after it was discovered that the bank, which held only a "B" class banking license, no longer had the required international bank as a parent. Dundee Bank of Canada had been sold, and therefore the Cayman bank's license was no longer valid.

Why on earth is a bank, supposedly liquidated years earlier, still in operation, and in Canada, sending correspondence to an American investor ? Though there is no publicly-available information on the subject, it is believed that Dundee Merchant Bank had insufficient funds on hand to return to its depositors, and the officers, President Derek Buntain and Senior Vice President Sharon Lexa Lamb, could not complete the liquidation process. I leave it to the authorities, and regulators, in the Cayman Islands to determine what Caymanian laws, and regulations were violated.

Also, why use a Toronto address ? The original parent entity, Dundee Corporation, is located in Toronto. What is its involvement in what appears to be a breach of trust, by Dundee Merchant Bank officers, affecting its depositors ? We cannot say, but it suggests that the Bank of Canada may want to investigate whether the operation of an unlicensed, reportedly closed, financial institution, in Ontario, is a violation of Canadian law.



On last point, if you call the Canadian telephone number listed for Dundee Merchant Bank, it rings in Grand Cayman, where it is answered by none other than Sharon Lexa Lamb, who answers for Dundee Leeds, an affiliated company that itself no longer exists, having also been sold off, who assures callers that everything is normal, and that the victim's investments at Dundee Merchant Bank, are in good standing, and on deposit in the reputable, old-line financial institutions, Butterfield Bank.

Where are the Canadian and Cayman government regulatory authorities on all this ? Asleep at the switch, or influenced by the good old-boy network, in the financial industry, to ignore fraud when it occurs in their jurisdiction ?

THE CAYMAN GANG OF FOUR RENEGES UPON PROMISE TO RETURN MONEY TO AMERICAN INVESTOR

Sharon Lexa Lamb

An American pensioner*, living in Florida, who was promised a 100% reimbursement of his investment account by the accomplished fraudster, Cayman resident Sharon Lexa Lamb, has now, months later, been told by Miss Lamb that she would not be refunding his money after all. The investor, who rudely told the Canadian whistle blowers who have been publicly disclosing the details of the $450m trading scandal to leave him out of any civil or criminal action, as he was being paid in full, is now out in the cold, and his entire retirement savings is gone, looted by the Gang of Four.

Attorney demand letters have been sent to counsel for the Cayman Gang of Four, who are: Sharon Lexa Lamb, Ryan Bateman, Fernando Mota Mendes, and Derek Buntain, both in Grand Cayman, and in Canada, and the filing of civil litigation, as well as criminal action, is said to be imminent, lest any readers think that the claimants have lost momentum. Lamb and Mendes remain on the Caymans, operating a shell company, and insisting to investors that their money, which is largely gone, is totally safe, in a financial institution. From the office of Bateman's shell companies (B & C Capital, Bateman Financial, and Bateman Capital), they continue to mislead, and outright lie to, investors looking to obtain their money.

Derek Buntain

Considering that the most recent frauds, perpetrated upon North American investors, by white-collar criminals residing in the Cayman Islands, were total losses for the victims, the compliance world is waiting to see whether the Cayman Islands Monetary Authority, or CIMA, will step up in  this case, and assist in a recovery for the victims. Should it fail to act, many compliance officers will most likely choose to raise Country Risk on the Cayman Islands to a point where new investors are discouraged from incurring any financial risk, by engaging in investment activities there, and to recommend that existing investors remove their assets forthwith.

The fugitive Ryan Bateman

Watch this blog for new developments in the case against the Cayman Gang of Four.
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* Notwithstanding his extremely poor judgment, in agreeing to work with known fraudsters, he shall remain nameless here.

THE KING OF SLEAZE: HOW A BAD PANAMA LAWYER WINS ALL HIS CASES

His name is Alcides Bartolo Peña Araya, (Panamanian government ID Number 8-220-979)* and he has an astounding 100% success rate with his cases in the Republic of Panama, though he never goes to trial on any of them. Most Panama City lawyers tell me that they have never seen him in a courtroom. He has no office; he has been referred to as a mobile lawyer, meaning that he literally works out of his car. So how can he be so successful and wealthy ?

It's easy; for Sr. Peña is one of the dirtiest lawyers Panama has, and that's saying a lot, given that the country's court system is known for its corrupt, bought-and-paid-for judiciary, all the way up to the Supreme Court of Justice. Here is how Alcides Peña operates:

(1) Peña bribes the Fiscal  (prosecutor) to infinitely delay the criminal cases in which his client is the defendant. The cases never go to trial; justice delayed is justice denied. Bribing judges is commonplace for Peña, for whom the end justifies the means.

(2) In the field of civil litigation, he engages in bribing the secretaries, court clerk, office staff, file room clerks, and whatever other staff involved in the case, so that files are destroyed, pages removed, evidence lost, and whatever other sundry dirty tricks, and thefts, that he is able to pull on opposing counsel.

(3) He pays off interpreters and the staff at their companies, so that any necessary interpreter always is unavailable, or fails to show up for a court appearance of the parties. As the result, no cases ever move forward, where his client is the defendant, or subject to a counterclaim. Delays for four years or more are common in his caseload. Many opponents run out of money, or leave Panama permanently.

(4) He obtains, from corrupt members of the judiciary, ex parte injunctive relief, which is illegal under the Laws of Panama, including prohibitions on international travel, while the case is pending.

(5) He schedules court hearings, and fails to notify the opposing attorneys, which is unethical and improper in any jurisdiction, so that he can prevail upon a judge to enter a ruling favorable to his client.

(6) He threatens bodily harm upon any victims of crime, whom he cannot pay off or otherwise beat in court, using all the above corrupt techniques and actions.

(7) When all else fails, he boldly bribes opposing counsel, thereby insuring that he will never lose a hearing or motion, for his opponent, whose lawyer's palm has been greased, is a no-show in court. He just doesn't know that his lawyer is working with his opponent's lawyer, and his repeated failure to show up to oppose Peña'a motions means that they are always granted.

How can he get away with all this ? Panama has no bar exam, and no effective attorney disciplinary process in exists. Peña takes full advantage of Panama's rampant official corruption, to get a win for his clients, at all costs, knowing that he will not be disciplined.

You may recall that Alcides Bartolo Peña has appeared on this blog before; he is the attorney for the American expat, Gary Lundgren, a known white-collar fraudster and sexual predator, who has been labeled the "Bill Cosby of Panama," due to his long and sordid history of sex crimes. Peña procures young girls for Lundgren, and cleans up the subsequent mess, insuring that criminal charges of rape or sexual battery are never filed. When necessary to protect Lundgren, Peña pays off the victims, and bribes anyone and everyone who can close up the matter in the court system.

Gary Lundgren

So long as sleazy lawyers like Alcides Bartolo Peña Araya can openly bribe all the participants in litigation, there is no hope for the rule of law in the Republic of Panama; he deserves a long prison term, in one of his country's most primitive correctional facilities, together with all the other dirty Panamanian lawyers who engage in this obscene manner of practicing law.
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* Panama Supreme Court attorney identification number 1247.

SHOULD YOU RAISE COUNTRY RISK FOR CANADA ?

The recent elections in Canada are bound to result in major changes in government policies, and the impact of some of those changes could result in increased Country Risk for the country. If any of these categories is relevant to your existing, or future, relationship with Canadian entities or individuals, for compliance purposes. you may want to reexamine your present calculation of Country Risk for Canada.

(1) The new Liberal government plans to increase taxes upon individual who earn more than CAD$200,000 annually. Will this impact either existing foreign debt, or accounts receivable, of entities owned by Canadians ?

(2) The new government, if it is anything like the Liberal administration of Mr. Trudeau's father, will change the national debt situation, going from  a balanced budget, to a major increase in debt incurred.

(3) Will high net-worth Canadians again flee their country, and become non-residents for tax purposes, sheltering their assets in uninsured and dodgy Caribbean tax havens, where they could sustain a total loss, due to fraud, or bank failure ? If they are victims abroad, will they default upon their obligations at home ? or will they seek to hide their assets, and intentionally default ?

(4) The Liberal Government intends to open the doors to Syrian refugees; remembering the massive problems that occurred when Iranian nationals, some of whom were undesirable, or worse, were allowed briefly to enter Canada under the citizenship by investment scandal, will Middle Eastern  terrorist financiers, or even the actual terrorists themselves, be allowed entry, due to the misplaced humanitarian concerns of the new government ?

If you, your bank, or your clients, will potentially be adversely affected by any of the above scenarios, you may want to raise Country Risk on Canada at this tine.   

MONEYVAL TO EVALUATE GIBRALTAR

The Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism, more commonly known as MONEYVAL, has adopted a resolution to the effect that the British overseas Territory of Gibraltar be evaluated by it, and be subject to follow-up procedures. The UK Crown Dependencies, the Isle of Man, Jersey & Guernsey, were approved for evaluation in 2012.

Readers who wish to review the complete text of the Resolution of the Committee of Ministers of the Council of Europe, CM/Res(2015)26, can access it here*; click on the hyperlink Resolution in the paragraph.

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* Resolution CM/Res(2015)26

RAISE COUNTRY RISK ON THE REPUBLIC OF SOUTH AFRICA

The official welcome, given this week to the leader of Hamas, Khaled Mashaal, by Jacob Zuma, the President of South Africa, should set off alarms among compliance officers who are responsible for assessing Country Risk. The pro-Hamas, anti-Israel press releases issuing from the Government of South Africa are only the outward manifestation of what appears to be a blossoming relationship.

This spells trouble for compliance officers who watch for new terrorist financing pipelines, where Hamas is concerned, for South Africans donors are well known to be supporters of Israel, and imaginative money launderers could exploit the low risk nature of transactions from the country, to move funds to Hamas, through circuitous methods not previously attempted.

Additionally, statements in support of Hamas, by pro-Muslim organizations in South Africa, and by Asian-Middle East NGOs, indicate that advocates for this internationally designated terrorist organization are active in the country, and could facilitate the flow of funds, weapons, or explosives to Hamas. This has become a real possibility, and compliance officers, and their staff should thoroughly vet al non-profits, NGO, associations, fraternal groups, or other entities whose funds, or shipments, are destined for the Gaza Strip. Funds could be transferred in by way of Turkey, where Hamas maintains a field headquarters, who object is to attack Israeli civilian targets.

Hamas operatives captured by Israel were reported to have large amounts of money in their possession; is South Africa one of the new conduits ?  In any event, the new love affair between Hamas and the ANC is a cause for concern, especially for compliance officers. Raise Country Risk on South Africa.

FRAUDSTER GARY LUNDGREN IS THE BILL COSBY OF PANAMA

My observations of financial criminals, over the past four decades, up close and personal, have led me to observe that many are also arrogantly involved in other illegal acts, including Crimes against the Person. Some are serial sexual predators; we have extensively covered the activities of career criminal Gary Lundgren, a fraudster masquerading as a financial adviser, wealth management professional, and real estate agent. He is one of those white-collar criminals who preys on vulnerable single, and married, females in Panama City. I call him the Bill Cosby of Panama; if the shoe fits, etc.

Lundgren has a prior history of sexual harassment in the State of Washington, and we believe that is why he relocated to Panama. His sexual predator activities are detailed in Steele vs. Lundgren, 982 P.2d 617 (Wash. Ct. App. 1999), which readers who do not have access to the Pacific Reporter can read here*. He reportedly was engaged in the same course of conduct with a number of victims in Washington.

Gary Lundgren a/k/a Gary James Lundgren

In the Republic of Panama, I have personal knowledge of several victims of his predatory activity, including one who reported him for rape to the local police. Unfortunately, in Panama's macho environment, cases cannot be brought unless there is a witness, which  means most sexual battery complaints never become criminal charges. Also, a law enforcement reluctance to charge anyone with rape, unless it was accompanied by violence, further decreases any possibility that offenders will face justice for their crimes.

Gary Lundgren's method of operation: he hires away an attractive assistant, at higher wages than she earns at her current job, and makes her his personal assistant. he then intimidates her into a sexual relationship, and, fearing loss of her job, she fails to report him to the authorities. After a time, he tires of her company, and fires her, making sure she cannot get work elsewhere, and goes on to a new victim. He has paid off the most vocal victims, insuring that he will not be charged with sexual battery in Panama.

How is this relevant in a blog that reports on white-collar crime ? Financial criminals often pose physical dangers to the public, and the extent of their sins and transgressions need to see the light of day, we need to warn potential victims of the threats they pose to the community. Consider known white-collar criminals, who may also be sexual predators, as public enemies, and steer clear of them. If any readers have been victims of Gary Lundgren, whether it be his financial frauds, or his sexual offenses, feel free to contact the writer, in confidence, and you will be referred to the appropriate government agencies for assistance. My email address appears on the upper right-hand corner of this page.


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*http://caselaw.findlaw.com/wa-court-of-appeals/1135519.html

WILL APPEARANCE OF CUBAN SPECIAL FORCES TROOPS IN SYRIA BLOCK CUBAN-AMERICAN NORMALIZATION ?

An unnamed US Government official has stated that Cuban Special Forces* and paramilitary troops have arrived in Syria, and will support the Assad regime in military operations. They may have arrived on board the Russian military transports that recently delivered Russian ground forces to Western Syria.

What effect these soldiers will have on the progression of normalization of Cuban-American diplomatic and commercial relations, and the lifting of sanctions, in unknown, but some members of the US Congress could move to freeze any further ties, and delay the lifting of the universal economic sanctions that are currently in place.

Though the United States has no regular ground troops in Syria, special operations troops, such as Navy Seals, Army Special Forces, and Delta, are believed to be working inside Syria. The potential consequence of any military action, between US forces and Cuban troops, cannot be ignored, particularly if there are casualties, and would probably deal a major setback to any ongoing efforts to normalize the Cuban-American relationship.

 Insignia of Cuban special operations units

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* Known as the Black Wasps. Their presence in Venezuela has been detailed previously on this blog.

PANAMA'S FINANCIAL CRIME VULTURES CIRCLE AROUND VLADIMIR KOKOREV

For those readers who have been following the pending extradition case, in the Republic of Panama, involving Vladimir Kokorev, facing money laundering charges in Spain, let me kindly update you on the most recent developments. The case is obviously of great public interest, but there are a number of aspects to the proceedings that deserve attention; Watch out for the vultures overhead.

(1) According to reliable sources close to the defendant, he has denied guilt. Unless there is clear & convincing admissible evidence, he may not be convicted. Some previous complex Spanish corruption cases have suffered from a deficiency in the level of proof offered by prosecutors. Do they have enough to get a conviction ? That remains to be seen.

(2) Mr. Kokorev, who is in poor health, which further deteriorated, when he was abruptly exposed to Panama's brutal, sub-standard prison conditions, is in no condition to be extradited at this time.

(3) The defendant may not ever leave his prison cell alive, for a similar high-profile extradition case, involving the Canadian Arthur Porter, resulted in an extraordinary delay in the proceedings, after which Porter died, while still in Panamanian custody, of terminal cancer. He did not receive adequate medical treatment, and the lack of medical care appeared to be intentional. Will procedural delays block his extradition indefinitely ? Porter's bank accounts were reportedly emptied after his preventable death.

(4) Kokorev is known to have substantial bank accounts in Panama's banks,  and those bankers have allegedly told those in command to delay, delay, and delay his extradition. Are they coveting his bank accounts also ? That is unfortunately how business is done in Panama, and since the court system is hopelessly corrupt, claimants may never go to trial on their efforts to collect their money.

(5) One of the businessmen that Kokorev dealt with was the American expat, Gary James Lundgren a/k/a Gary Lundgren. It is Lindgren's method of fraud to purchase real estate for his clients, using a bearer-share Panamanian corporation, and later tricking the client into assigning over all his right, title and interest to the realty. Lundgren's attorney,  Alcides Bartolo Peña Villar, pays corrupt notaries to attest to forgeries, and fraudulent documents, and Lundgren takes off with his now former client's property and assets. Will Lundgren steal Kokorev's real estate investments ? He may have already done so.

(6) The power structure in Panama has recently warned local journalists not to print any new articles about Kokorev, or there will be consequences. Clearly, its fraudsters intend to relieve Mr. Kokorev of his wealth.

The deck appears to have already been stacked against Vladimir Kokorev, and his assets appear to be the target of the Panama City vultures who prey upon vulnerable expats. Will he survive ?

HAMAS FUNDING TERROR ATTACKS IN ISRAEL THROUGH ITS FIELD HEADQUARTERS IN TURKEY

It may not be politically correct to discuss, due to the fact that Turkey is a NATO member, and an ally in the war against ISIS, but the payments for the teenage terrorists who are stabbing and shooting Israeli citizens, in daily attacks in Jerusalem and elsewhere, are coming from Hamas' foreign field headquarters, located in Turkey. Perhaps the fact that Turkey has refused to close down the Hamas operations center, after being asked, is so embarrassing to the US and the UK, that it has clamped down on any discussion of its terrorist payment pipeline in mainstream Western media. How can the Western democracies allow Turkey to subsidize a designated terrorist organization so openly ?

On this side of the Pond, there's another embarrassing aspect to the story: the money used, to pay off the families of these teenage terrorists, some of whom as are young as 13, originally came from banks in Panama. Money from Hamas' terrorist financing operations in the Western Hemisphere flow through Panama City banks, who practice willful blindness when it come to terrorist organizations repatriating drug profits and the proceeds of other crimes. How law enforcement agencies in the United States & Canada can allow Panama to openly move terrorist funds to the Middle East is beyond me; monitoring the traffic, with no arrests being made, is no way to run a counter-terrorism operation.  

ALERT: ST. LUCIA CITIZENSHIP BY INVESTMENT ECONOMIC PASSPORT PROGRAM BEGINS 1/1/2016

If compliance officers at international banks don't have enough problems conducting enhanced due diligence investigations on all new customers who hold St. Kitts & Nevis and St. Vincent & the Grenadines passports, due to the problem economic passport programs operated by those island nations, now the Prime Minister of St. Lucia has announced that his nation will begin accepting applications for its own new Citizenship by Investment program. While official statements indicate that the St. Lucia program will be conducted with all due care, in screening the applicants, to insure that no "unqualified" individuals are accepted, the other programs operated by Caribbean countries have approved known criminals, individuals from sanctioned countries, and other high-risk applicants who should not qualify under any circumstances.

While it may seem inappropriate, prior to the actual opening of the St. Lucia Citizenship by Investment program, to regard it as a problem, the deficiencies in customer identification, as well as what can only be described as willful ignorance by program officers, and compliance staff, leave us no choice in any risk-based compliance program. We are all aware of the scandals of the recent past.

You can be assured that career criminals, as well as they money laundering advisers, are well aware of the upcoming St. Lucia program, and will seek to crash it, using well-documented front men, to obtain that prized passport from a Commonwealth of Nations jurisdiction. After December 31, you should regard any and all individuals presenting passports from St. Lucia as candidates for enhanced due diligence investigation. This includes diplomatic & official passports as well, for we must not forget the case of the individual who showed up in Canada, with a purchased St. Kitts passport, demanding to see the Prime Minister.

MURCIA TO PANAMA: RETURN TO ME MY DEPOSITS AND INVESTMENTS

David Eduardo Helmut Murcia Guzmán, the Colombian businessman who brought billions of dollars from his pyramid business to Panama, and invested much of it locally, has reportedly, through legal counsel, made a firm demand for the return of his assets. Murcia is believed to be a cooperating individual with US law enforcement agencies, and is no longer in Federal custody. Whether he is receiving assistance and support, in his quest to recover assets, from those agencies, is not known.

With respect to Panama, it is important to point out that Murcia was acquitted of all criminal charges filed against him in the Republic, meaning that he is not otherwise barred from seeking return of his funds and other assets. Also, while most Panamanians believe that he was extradited to Colombia, in truth and in fact, he was summarily, and without legal process, taken into custody, and flown to Colombia. In essence, he was expelled from Panama.

If you are wondering why, after his acquittal, he was removed from the country, you need only look at what happened to his investments, to know who was behind his expulsion: the banks where he had huge deposits, and the financial consultants who placed his money into real estate, luxury yachts, and other investments. These fraudsters quickly assumed control over his assets; many were held in bearer share Panamanian corporations, where the individuals in whom Mercia had placed his trust held the certificates of shares of stock. Quiet transfer was accomplished in private.

Now you know why Murcia is so angry; to illustrate just one of the cases, Murcia engaged the expat American businessman, Gary Lundgren, to purchase dozens of luxury condominiums, in both the residential and office categories. Lundgren converted these properties to his own use and benefit, after Murcia was abruptly removed from Panama.

 He employed his principal attorney, Alcides Bartolo Peña Villar, known in Panama as the Fixer*, to effectuate the transfers of title to Lundgren's control. This was grand theft, through fraud, plain and simple. Lundgren reportedly used the cash he held for Murcia to participate in the Financial Pacific/ Petaquilla Mine insider trading securities purchases, on behalf of many of the members of Ricardo Martinelli's cabinet. Murcia cash became seed capital for Panama's biggest securities fraud case in history.

Most Panama analysts believe Lundgren was one of the prominent businessman who prevailed upon then-President Torrijos to expel Murcia, and that much of Torrijos present holdings, in the Dominican Republic, were purchased with Murcia's cash. I leave it to you to connect the dots. Many of the banks where Murcia had accounts took his deposits, and his yachts and luxury cars were also stolen.

These are but a sampling of the details of the widespread theft of Murcia's Panama holdings. Will Murcia recover his money ? We cannot say, but it will be interesting to see Panama's elite fraudsters, like Lundgren, squirm, thinking of the nasty litigation certain to come.
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Peña is known to pay bribes to judges and prosecutors, to secure favorable rulings, or delays, in court proceedings, on behalf of his clients. He also is known to threaten physical harm to opponents of his clients, including Lundgren. Unfortunately, Panama has no system of discipline for attorneys, some of whom actually return to the practice of law after serving prison terms. In any other country, Alcides Bartolo Peña would be disbarred, and serving a long sentence in prison.

HONDURAS CLOSES, AND FORCES LIQUIDATION, OF SANCTIONED BANCO CONTINENTAL

The Government of Honduras has announced that Banco Continental, closed since it was listed as a Drug Kingpin, by the US Treasury Department, for engaging in drug money laundering, will undergo forced liquidation. When the United States froze the bank's US-based assets, its solvency dropped below the legal minimum, requiring that it be liquidated.

Account holders will be able to draw funds, up to the equivalent of USD$9000, by the country's banking regulator, the National Banking & Insurance Commission. Any bank client who had more than that on deposit reportedly will also be compensated at a later date.

The case has drawn international attention, due to the fact that it represents the first time that a financial institution was designated a SDNTK, or Specially Designated Narcotics Trafficking Kingpin, for engaging in drug money laundering. The denial of access to the US banking system, for any financial institution, is fatal, for the bank's clients are unable to have access to American banks, or its companies, or individuals. Naming a bank as a Drug Kingpin is public notice that the United States has evidence that the bank has a major role in the laundering of the proceeds of crime, specifically narcotics. 

PANAMA'S FUGITIVE EX-PRESIDENT ORDERED OUT OF PARAGUAY

Ricardo Martinelli, facing eleven different criminal charges in his native Panama, including human rights violations, insider trading, and massive corruption allegations, has been ordered by the Government of Paraguay to lave the country immediately. The former President of Panama has been living in an estate in Paraguay, that he covertly purchased while in office, since major corruption scandals broke in Panama. The fact that he was living in Paraguay, and not in Miami, as his supporters have long claimed, was well known in Panama City.

Reliable sources in the Republic of Panama state that Martinelli has approached the governments of Spain, and the United States, seeking asylum, alleging that the current Panamanian government has targeted him for purely political reasons, and that he is innocent of all pending charges. To date, neither government has responded to his requests.

There are also unconfirmed rumors that there is a reward, or bounty, offered for his capture, but whether there is a factual basis for this information is unknown. Over 150 families in Panama, both citizens and resident expats, were victimized by Martinelli's illegal telephone and Internet surveillance program, and they are demanding justice. Will the former president, now reviled in Panama, ever see the inside of a courtroom, to answer for his many crimes ? We cannot say, but his banishment from Paraguay makes that day seem a bit closer to reality. When Martinelli leaves the safety of his Paraguayan refuge, he becomes easier to catch.

TORONTO DOMINION BANK REGIONAL VICE PRESIDENT PLEADS GUILTY IN $1bn ROTHSTEIN PONZI SCHEME

Frank Spinosa, the TD Bank Regional Vice President who authorities charge facilitated Scott Rothstein's massive Ponzi scheme, by writing bogus "Lock Letters," which falsely stated that investor profits were frozen, has entered a plea of guilty, and executed a plea agreement. Spinosa pled to a single count, meaning that his maximum sentence is five years in Federal Prison, and a $250,000 fine.

Was his signature on some of those letters forged by the individuals who worked with Rothstein, to perpetrate the Ponzi scheme, as the defendant claimed ? Inasmuch as the case will not now go to trial, that question will remain unanswered, as will any involvement of senior TD Bank executives in the fraud, if any. Did anyone at the executive level know that it was a Ponzi scheme, and when did they know it ?

The takeaway for compliance officers, from the Rothstein case: if you have a successful bank client, always check out whether he or she is really engaged in the business that is driving the financial success that the bank is profiting from. In this case, nobody apparently ever check to verify whether the Rothstein law firm had ever filed the hundreds of civil cases which gave rise to the sale of court settlements to the victims. The court dockets are a matter of public record, and anyone making inquiries would have seen immediately that the firm's caseload did not support the huge volume of money it was taking in.

OFAC SANCTIONS HONDURAS' BANCO CONTINENTAL UNDER KINGPIN ACT

Banco Continental SA, a major Honduran commercial bank, headquartered in San Pedro Sula, has been sanctioned under the Foreign Narcotics Kingpin Designation Act, in connection with a major money laundering case brought in Federal Court, in the Southern District of New York. Members of the Rosenthal family, a prominent force in the Honduran business community, have been charged with money laundering for drug traffickers, and their corporate entities were also designated by OFAC. The bank was listed as an SDNTK.

The Treasury announcement accompanying the sanctions and indictments, explains why the bank was named:

"Today's announcement marks the first time that OFAC has designated a bank, pursuant to the Kingpin Act. Banco Continental SA has served as an integral part of the Rosenthal money laundering operations, and facilitated the laundering of narcotics proceeds for multiple Central American drug trafficking organizations.*"

Many compliance officers have felt, for many years, that merely imposing fines upon foreign financial institutions, for drug money laundering activities, is an insufficient deterrent to others. The Kingpin Act designation, which will effectively bar Banco Continental from the US banking system, is a powerful remedy that, in my opinion, should be employed whenever there is conclusive evidence that a foreign financial institution is a major player in a drug money laundering operation.

Please note that there are a number of other financial institutions in Latin America, and the United States, with similar names, and compliance officers are urged to immediately acquaint their staff with the details of the other banks, lest confusion result in a non-sanctioned bank's transactions be frozen, or  a Banco Continental wire transfer be approved.
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*Treasury Sanctions Rosenthal Money Laundering Organization

IS ARGENTINA'S EX-SPYMASTER HIDING OUT IN MIAMI ?

The Government of Argentina is seeking the former head of the Intelligence Secretariat (SI), the country's hybrid intelligence service, Antonio Stiuso, a/k/a Jaime, and has reportedly sought the assistance of the Government of the United States in locating and apprehending him. Some sources claim that Stiuso is living anonymously in Miami.

The SI, which seems to discharge the functions of both an intelligence agency, like the CIA, and a signals intelligence agency, like the NSA or GCHQ, was involved in the ongoing investigation into the AMIA bombing, reportedly conducted by agents of the Government of Iran. Stiuso's personal involvement, with Alberto Nisman, the government investigator, with his finding of a link between Iran, who allegedly sponsored terrorist acts in Argentina, and the President of that country, may have resulted in bogus charges being filed against him, causing him to flee.

Is the Government of Argentina seeking to suppress the truth about its relationship with Iran, and where does Stiuso fit in ? We hope that he comes out of the shadows long enough to tell us, for it may be that the Government of Argentina is seeking to frame him for Nisman's murder, in the classic "Kill the messenger" style of dirty Latin American politics.

RICHARD CHICHAKLI, DESIGNATED BY OFAC, SERVES HIS TIME UNDER STRICT CONDITIONS

If you were wondering why Richard Chichakli, who is appealing his Federal conviction for OFAC violations, is serving his sentence at the Federal Detention Center (FDC) in Miami, you are not the only one. Chichakli's case was in the Southern District of New York, and his appeal is in progress at the Second Circuit Court of Appeals, which is also in New York. So why does the Bureau of Prisons have him housed in Miami ?

An FDC is where inmates subject to pre-trial confinement, due to their risk of flight, or danger to the community, are confined. Also, witnesses being held for trial testimony, inmates who are at personal risk, for a variety of reasons, or inmates close to being released in the Miami area. It is not designed for one to serve his entire sentence. Chichakli is within two years if his release date, and his US citizenship, and lack of history of violence, all should have resulted in his institutional placement closer to his appellate attorney in New York. So why is he here in Florida, instead of somewhere in the northeastern United States ?

I suspect that his multiple pre-trial complaints, to the effect that the conditions of his confinement in New York prevented him from properly preparing for trial, might have something to do with it. Remember also that he was subject to "diesel therapy," a deliberately circuitous route to his final correctional destination, which results in multiple overnight stays in a number of county jails with primitive accommodations for transients.

 His attorney obviously cannot easily meet with his client, due to the fact that he was abruptly shipped, after sentencing, to the Miami FDC, in a move that an objective observer might see as a punitive BOP response to his vocal complaints to the Court, and to the Bureau of Prisons staff. We wonder why he is not sitting in a Federal Prison Camp, given his profile and history, and the short time remaining upon his sentence. Is it because he, like his co-defendant and partner, Viktor Bout, fell out of favor with the American intelligence community ?

  

FORMER PANAMANIAN MINISTER OF TOURISM TO BE INVESTIGATED IN FINANCIAL PACIFIC INSIDER TRADING CASE

Panama's Superintendent of Securities has requested a criminal investigation to be opened, against the former Minister of Tourism in the Martinelli Administration, Salomón Shamah. The case is the massive insider trading scandal involving shares of stock of Petaquilla Mine, traded through the Financial Pacific brokerage house. Martinelli, as well as most of his then-ministers, have been implicated by the former Superintendent of Securities, as well as the whistle blower, Mayte Pellegrini.

Shamah reportedly had his US Visa revoked several years ago, due to his reputed involvement in arms trafficking into Colombia, as he was accused of supplying the FARC & ELN, two specially designated global terrorist organizations. Shamah, a Colombian national, was a naturalized citizen of Panama. He has been linked to a powerful sector of Panamanian organized crime, and is known to be a close confidant of Ricardo Martinelli, for whom he allegedly laundered drug money. His appointment as Minister of Tourism, when he was not qualified for that position, occurred due to their relationship, and he has long been rumored to have engaged in corrupt activities, during his tenure as minister.