ATLANTIC RIM FUNDING AND DEAN KENNEDY SANCTIONED

A Federal Bankruptcy Judge, in an Adversary Proceeding* pending against a purported lender and its principal officer, has sanctioned both, with probably more to come. Seen by most observers as a combination of Advance Fee Scheme & Ponzi Scheme, Atlantic Rim Funding Corp. failed to obtain any financing last year, for a nonprofit corporation in Pennsylvania seeking to purchase and operate a historical landmark. Its promises seemed to evaporate into thin air, as did its principals.

Then, the "lender" failed to return the $600,000 "escrow deposit", of which $240,000 is still due and owing and missing, a year after funding failed to occur.  The balance of the escrow was reportedly used to repay deposits of earlier investors, hence the Ponzi aspects.

This week, the Court:

(1) Ordered that Atlantic Rim & Dean Kennedy, (this may be an alias) its principal,  provide all documents requested by the Plaintiff by 14 may.

(2) Ordered that the corporation produce a designated officer, with personal knowledge of the case, by 21 May.

(3) Fined the defendants $500 for their conduct.

(4) Entered Defaults against Atlantic Rim Funding Corp., and Dean Kennedy, for failure to respond to the Complaint. They were ordered to reply on 10 February. No lawyers have appeared for either defendant. Their former lawyer, J "Mac' Rust, from Texas, has filed an answer pro se.  He has alleged that the Plaintiff was supposed to sue his professional corporation, and not him individually. He released funds from escrow, according to the court file. Is there not personal liability ? Corporate shield does not apply.

(5) Set a date, 23 May, " to consider the imposition of further sanctions. "

                                                                   Charles Ponzi


Don't hold your breath, anyone. These fraudsters will not show up in court and it appears that they have already gone on to another scam. The moral of the story: never, never advance fees to get a loan or other funding. Reputable companies deduct it at closing from the loan proceeds; anyone else is a fraudster. Ponzi schemers pass along the deposit to earlier victims, part of it, keeping some for themselves.
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* Case No.: 12-00007-ELF (ED PA).

CHINA AND THE PHILIPPINES SWIM IN DANGEROUS WATERS

Fu Ying, China's Vice Foreign Minister met this week with Alex Chua, Charge D'Affaires at the Philippine Embassy in Beijing, and bluntly told Mr. Chua that his country is to back off from the maritime stalemate between the two countries, over Chinese claims to Scarborough Shoal*.

Both countries have ships at the disputed island, which China has claimed "indisputable sovereignty" over as part of its attempts to claim the entire South China Sea. The Philippines has sought to obtain arbitration over the controversy, at the International Tribunal on the Law of the Sea, but China has reportedly refused to participate. 

Scarborough Shoal, which lies only 230km. from the Philippines, but 840 km. from China, has been shown as Philippine territory since Spanish colonial times. This map, from 1820, shows the island, then known as 'Bajo Scarboro," as a part of Zambales Province. 

Regional risk shall continue to increase in the South China Sea, so long as China keeps asserting dominance over the entire area, creating diplomatic tensions with the Philippines, Vietnam, and all the other Southeast Asia nations over the Spratley Islands, small uninhabited atolls that abut the strategic north-south maritime trade route. The United States has intentionally insinuated itself into the disputes, much to the obvious displeasure of China, to level the playing field, regarding negotiations as well as military capability in the area. Will there be an international incident that rises to the level of armed conflict ? We cannot say, but we will be monitoring the situation closely.

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* The Chinese call it Huangyan Island.

US WARNED SPAIN AWAY FROM MADRID TRAIN BOMBER, BUT THEN FAILED TO CATCH HIM IN TIME

When the intellectual author of the Madrid Train Bombing fled to Venezuela, and the protection of the Chavez regime, the Government of Spain tracked him. So did the United States, namely the Central Intelligence Agency. Local assets, acting on behalf of the agency, surveilled Mustafa Setmariam Nasar, as he visited the Central Mosque in Caracas, a travel agency suspected of being a terrorist front, and a major Venezuelan port suspected of being the point of embarkation for Uranium bound for Iran.

Meanwhile, the Government of Spain, who wanted Nasar to face justice, to pay for his crimes, was told to back off; the US Government explained that would take care of him in due course. Unfortunately, he was never taken into custody during his Venezuelan stay, which commenced immediately after Madrid in 2004, and not seized until late in 2005, in Pakistan.. This was to constitute a major intelligence failure for two reasons.

(1) Living undisturbed in his Venezuelan safe haven gave Nasar, believed at that time to be the Al-Qaeda Operations Chief for Europe, sufficient freedom and time to reportedly plan the London Bombings, which occurred in 2005.
(2) It also afforded him time to coordinate, plan and execute what was later known as the Improvised Explosive Device (IED) programme in Coalition-occupied Iraq.

The entire time that Nasar was operating in Venezuela, there were no American efforts to capture or kill him. He left Venezuela in 2005, and was captured by Pakistani authorities in October. Though he was apparently turned over to the Agency at that time, no public information was released by the United States, regarding the capture of Al-Qaeda's top theoretician. Was the United States perhaps embarrassed  by their failure to take him in 2004,  or was it something more sinister ?

Individuals working with the intelligence community at that time insist that the Agency had penetrated Nasar's entourage, and had an asset inside his organisation. They will not disclose his identity, save to say that he was a Persian, and his primary role was collect intelligence. If that was the case, then it must be assumed that he knew the details of the London Bus and Underground Bombings that Nasar was planning. Why wasn't the British Government notified in advance ? That's a steep price to pay to keep an asset from being unmasked.

                                              Middle row, second from the left.      

Still wanted by Spain, he spent years in the Agency's so-called "secret prisons, " including the one at Diego Garcia, and was later turned over the Syrian authorities for safekeeping, but the Assad regime released him this year, apparently due to American support of the Syrian opposition. He promptly disappeared, and is said to be in Iran, but this is not verified.

Nasar has never faced Spanish (or British) justice, and now a terrorist leader who once was regarded as one of the top ten FBI terrorist fugitives is on the loose. It is doubtful that he will ever be called to account for what he did in Europe.

 His 1500-page treatise on Jihad, The Global Islamic Resistance Call, is regarded as the seminal work by Islamic terrorists around the world. He poses a clear and present danger to the West.

One wonders whether anyone in the United States was ever held accountable for this galactic intelligence failure. What will happen when this terrorist plans yet another attack ? 

$3BN PDSVSA BOND ISSUE IS HEAVEN FOR MONEY LAUNDERERS

Last week, Petroléos de Venezuela, PdVSA, the national oil company, announced that it was issuing $3bn in 20-year, nine per cent, bonds. These instruments are dollar-denominated, meaning that they may be purchased for Bolivars, Venezuela's troubled national currency, but are redeemed in US Dollars. This is what money launderers dream about.

Money launderers working for narcotics traffickers, arms dealers, corrupt politicians who take bribes and kickbacks, Bouliburgesía* who have sweetheart contracts with the Venezuelan Government, and assorted other suspects, all want one thing this year: to effectively launder their criminal proceeds, turn them into dollars overseas, in the process moving them out of Venezuela, just before the expected civil war erupts, after Chavez' funeral. They sell the bonds overseas for dollars, even accepting a discount, just to be able to move funds.

It was this alternative method of obtaining dollars that was exploited by Venezuelan broker-dealers whose accounts were seized by US law enforcement in the Rosemont**  case. Rosemont's CEO facilitated their movement of dollars through "sub-accounts" at Bank of America, claiming, in error, that they did not have to register as MSBs with FinCEN and the State of Florida.

If I am an overburdened Venezuelan money launderer, I want to buy those bonds, very badly. There's not going to be anyone at PdVSA checking my Source of Funds, nor at the other (buyer's) end, because the foreign broker is only checking out his client, not the seller of government-issued bonds. They will go fast, I predict; Watch for an extraordinary amount of bond activity in Panama, where Venezuelan bondholders will unload them to local investors, and borrow against them at Panamanian banks.

Broker-dealers in the United States who read this, would be well advised to avoid handling ANY PdVSA debt instruments or securities, for you never know when you might get a subsequent visit from US law enforcement agents, enquiring why you bought bonds from someone on the OFAC list, or worse.
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* Members of the so-called Bolivarian Elite, Venezuelan businessmen who are close to the government; they generally hold lucrative contracts with governmental agencies, often monopolistic in nature, and pay bribes and kickbacks to the officials and officers to grant them these sweet arrangements.
**One Year for Money Laundering in Rosemont case ! Are they Kidding ?

CHAVEZ IS IN A HYPERBARIC CHAMBER IN CUBA

Why has Venezuelan President Hugo Chavez Frias been unavailable to the press whilst he is treated in Cuba ? Reliable sources inside Venezuela have advised that Chavez,  reportedly suffering from  advanced cancer, has been using a Hyperbaric Oxygen Chamber, each day, for hours at a time. He has taken to sleeping in the chamber, according to witnesses who have been to Cuba.

This therapy, which funnels large amount of oxygen to the patient, is often used to treat wounds that will not heal. Chavez is alleged to have an open hole in his side, at his pelvis, either as the result of his cancer, or the unsuccessful radiation therapy treatment.

He is not expected to live long enough to run in this Fall's presidential election, and some experts believe he will pass away this month, leaving as his legacy a ruined Venezuelan economy, where the population suffers from major shortages of food and other necessities, and a number of contenders jockeying for the right to be the presidential replacement. Is a civil war coming ? Are you kidding ?

What about the tens of thousand of  Cuban "advisers" and local militiamen, armed to the teeth by Chavez ? Do not expect a happy ending here, just a descent into chaos.

INTERPOL RED NOTICE ISSUED FOR JUSTICE APONTE

The Government of Venezuela has obtained an Interpol Red Notice (arrest order) for former Venezuelan Supreme Court Justice Eladio Ramon Aponte Aponte, who fled the country, and has literally defected to the United States. Aponte, who had first gone to Costs Rica, was brought to the United States by the Drug Enforcement Administration.

 Aponte's revelations concerning the role of dozens of Venezuelan colonels and generals in narcotics trafficking have shaken the military establishment in that country, and emboldened the Opposition. It is believed that the recent assassinations of generals is linked to fears that his testimony will implicate military officers at the highest level. He also has charged that he was ordered to fix criminal cases, irrespective of guilt or innocence.

For the benefit of those who do not follow developments in Venezuela, there have been dozens of exiles who have faced Interpol Red Notices for purely political crimes; some have been forced to retain American lawyers, to contact Interpol and supply evidence of the political nature of charges filed against them in Venezuela, and forwarded to Interpol, who has later dropped the Red Notices.

Frankly, you should disregard database entries about recent criminal charges, and newspaper reports of arrests, coming from Venezuela, where corruption, and not the Rule of Law, is the order of the day. Opposition leaders are charged for purely political purposes, and organised crime, who pays bribes and kickbacks to government and the military, is allowed to operate unhindered. 

PROSECUTOR ASKS FOR 80 YEARS IN PRISON FOR CHARLES TAYLOR

The Prosecutor in the War Crimes trial against Charles Taylor*, in the Hague, has recommended a Global Sentence of 80 years in prison, or separate sentences, on the eleven counts, totaling 770 years. In the Prosecution Sentencing Brief,** these points were considered:

(1) The general nature of the underlying crimes.
(2) Mr. Taylor's role and participation in the crimes.
(3) Length of time during which the crimes were committed.
(4) Mr. Taylor's willing and enthusiastic participation in the crimes.
(5) Mr. Taylor's leadership positions and betrayal of positions of trust.

 The conclusions reached:

"Justice requires that Mr. Taylor's sentence should reflect the extraordinary suffering caused by Mr. Taylor's knowing, willing and long enduring participation in the crimes committed in Sierra Leone, and recognize the critical role he played in a criminal campaign which lasted years."  (Brief at 43).

The recommendation: " The prosecution recommends a global sentence of 80 years in prison or sentences on the individual counts from 80 years for Count 1 to 40 years for Count 11 as set out below." The eleven counts, if taken consecutively, contain a recommendation of a total of 770 years.

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*Prosecutor vs. Charles Taylor,  Case No. 1 (Special Court for Sierra Leone).
*http://www.sc-sl.org/

DID PANAMA'S GLOBAL BANK POSTPONE $200M BOND ISSUE BECAUSE OF MARTINELLI INVESTIGATION ?

On Thursday, Global Bank announced that it had "indefinitely postponed" the issuance of its scheduled $200m global covered-bond issue. Investors were to be offered 5-5.25% interest on the mortgage-backed bonds, which were due in five years. The bonds were to be secured by the credit rating of the issuer, as well as a pool of active Panama-based residential mortgages denominated in US Dollars.

Whilst the reasons offered for this action included a lack of investor interest, the question remains: was the issue shelved due to the pending criminal investigation, in Italy, against Panamanian President Ricardo Martinelli ? Martinelli is said to be a major shareholder in the banks; some sources claim that he is the largest shareholder, and that his son, who is a director of the bank, is also a shareholder. The son is also reportedly under investigation on the same corruption charges in Italy.

Rumours swirling around Panama City claim that the bank has been to four underwriters thus far, all of who have, after thorough study, declined to take the bond issue. It has been reported that the bank is undercapitalized, and is in dire need of this bond issue. Is the bank's loan portfolio non-performing ?

Is Martinelli's imminent indictment in Italy affecting Global Bank's ability to raise capital ? We cannot say, but we shall continue to report on the Martinelli case, as it unfolds.



  

ADMIN ASSISTANT AT PONZI SCHEME GETS PRISON TIME

A low-level administrative assistant, at the law firm* where convicted lawyer/Ponzi schemer Scott Rothstein sold assignments of phantom settlements in sexual harassment and employment discrimination claims to greedy investors, was sentenced today in US District Court** to six months in Federal prison.

Marybeth Feiss, who pled guilty to Conspiracy to violate Federal Election Laws, made a small ($2300) illegal campaign contribution for her employer, Scott Rothstein, but the Court, taking into account that it was part of hundreds of thousands of dollars of payments intended to influence elected officials, declined to hand down a non-custodial sentence.

The defendant's attorney, who file a seventeen-page memorandum of law in seeking a sentence of home confinement (house arrest) or probation, detailed for the Court his client's prior history, and argued for a sentence without incarceration, to allow her to care for her minor child. He also detailed his client's lack of involvement in the Ponzi scheme, but the Court, reportedly stating that there are consequences for attempting to corrupt the democratic process, declined a request for probation.

The guidelines, which are only advisory at this time. called for 24-30 months in Federal Prison, but the Court found that she had a minor role in one transaction, and adjusted her sentence downward. She did not render Substantial Assistance, because it appears that she had no knowledge of the massive Ponzi scheme then in progress.

Individuals who are caught up in high profile criminal cases, no matter how small their involvement, are often made examples of, so as to deter others who might be tempted to violate the law. If you are working in a company where you believe that criminal conduct is occurring, you must remove yourself from that environment forthwith, and notify the appropriate authority, lest you get caught up in a criminal conspiracy that results in a felony conviction.
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                                               *Rothstein Rosenfeldt Adler

**United States vs. Feiss,  Case No.:  11-cr-60282-KAM (SD FLA).

DOES CHAVEZ HAVE ONLY TEN DAYS TO LIVE ?

Reliable sources inside Venezuela, quoting from information received from Cuba, where President Hugo Chavez Frias is undergoing intensive treatment for what has been described as terminal cancer, are stating that the president is expected to die during the month of May. He will therefore not survive long enough to see the national elections in the Fall.

Chavez' pelvis, apparently weakened by the spread of cancer, has reportedly fractured. The Venezuelan president has been on a revolving door to trips to Cuba for medical treatment. Should Chavez expire, most observers fear a major power struggle in Venezuela. The groups believed to factor in what could deteriorate into a civil war include;

(1) The hardcore socialist elements the government. These senior leaders, many of whom are closely allied with their opposite numbers in Cuba, are expected to make a move to take power, using any means available. They can rely upon the tens of thousands of Cuban "advisers" on the ground in Venezuela, who presently actually run many government agencies.

(2) The Venezuelan armed forces. There are serious divisions within the military, and a coup attempt, from any quarter, is possible, which could result in a civil war. Elements of the National Guard that are engaged in primarily narcotics trafficking will also pose a threat to stability post-Chavez.

(3) Elements in the government and business community whose primary aim is not political, but acting for monetary gain, through bribes and kickbacks to corrupt senior government officials, and "sweetheart" government contracts that are extremely lucrative.

What will happen in Venezuela ? We cannot say, but we will be reporting on all developments as they occur.

WHO WILL CLEAN UP PANAMA ?

Systemic money laundering rages out of control in the Republic of Panama. "Flight Capital," mainly narcotics profits, flows into the country from Venezuela, Colombia, and yes, the United States, unhindered and, unofficially, welcomed. What's wrong with this picture ? Prosperity yes, yet enjoyed at what is certainly an unacceptable price.

Should legitimate businessmen, especially foreigners, have a bona fide claim for damages or loss, they often find the judiciary has been bribed, in advance, to rule against them, even when the law and the facts support their case. Horror stories of corruption, reaching all the way up to the Supreme Court of Panama, are exchanged between prominent Panamanian law firms and clients seeking justice.

Personally, I know many honest bankers, and ethical attorneys in Panama City, but they live under the looming dark shadow of organised crime and corrupt politicians. What is to be done ?

Panamanians are fine people who live in a beautiful country; they do not deserve to live in such a corrupt system. Reform is desperately needed, but there is nobody on the local political horizon to clean house. Drastic measures are called for.

Will someone please call Paris, and wake up the caretakers of the FATF Non-Cooperative Countries and Territories (NCCT) List; unfortunately, we need it now more than ever. It is surely "Blacklist Time" once more, and we need to apply it to the Republic of Panama.

ALERT FOR AN AML WOLF IN SHEEP'S CLOTHING

Last year, I received an invitation to speak at an AML conference in a Caribbean nation; I always perform due diligence on any organisation sponsoring a programme that is seeking my presence. What I learnt was disturbing; the company's true owner (not the front men that everyone said owned it) was a former senior adviser from a South American country who had a curious way of doing business.

The lawyer, a former senior AML adviser in his country, offered his consultancy services to bankers and financial service companies. They were rarely refused, because prospective clients have reported that the individual threatened to turn in the company to the government regulatory agency that he formerly worked at, if they declined to accept his AML services. Is that making an offer that one simply cannot refuse ?

Based upon the foregoing, I declined to appear as a speaker.

Today, I was advised that this bogus AML entity has moved its headquarters into Panama, and that the company is reportedly a front for actual money laundering operations in Panama's banks. The AML company is merely window-dressing for organised crime.  If you are a Panamanian banker, you know who this company is.

Bottom line: know your AML/CFT provider; there are a number of posers out there.

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PRESIDENT SIGNS EXECUTIVE ORDER TARGETING FOREIGN SANCTIONS EVADERS

Bankers and businessmen who evade US sanctions on Iran and Syria now risks the imposition of severe consequences, due to an Executive order signed into law today, 1 May. Entitled Prohibiting Certain Transactions, with and Suspending Entry into the United States, of Foreign Sanctions Evaders with Respect to Iran and Syria*," it imposes major sanctions on foreign nationals who facilitate the evasion of sanctions in place against Iran & Syria.

What will happen to such violators ? Read on ...

(1) Individuals and entities that are found to have facilitated sanctions evasions, or even attempts, will have their names published by the US Government. This will result in their placement upon all commercially-available high risk databases, with all the attendant negative results.

(2) US persons and entities will be prohibited from doing business with them, effectively cutting them off from the US financial and commercial marketplace.

(3) They will be barred entry into the United States.

How would you like it if your bank could not longer have correspondent relationships with US banks; it might drive your bank out of business, due to a failure to adequately service international clients. Perhaps those bankers in the Middle East who are making a fortune assisting in sanctions evasion, particularly involving Iran, may want to reconsider. Personally, I love the idea of a "name & shame" list; it will end the careers of some of those greedy souls.
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*It can be found on the www.treasury.gov/ website.




  

VIKTOR BOUT KEEPS HIS APPEAL ALIVE

Someone came into the clerk's office of the Second Circuit Court of Appeals and, at the last, minute, paid the filing fees in Viktor Bout vs. United States of America*.  The appeal will not be dismissed.
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* Case No.: 12-1487cr (2nd Cir. 2012). 

WHO STOLE DAVID MURCIA'S PANAMA REAL ESTATE ?

David Murcia Guzmán had his huge portfolio of Panama real estate holdings stolen while he sat in Colombian and American prisons. Conservative estimates by bankers who saw some of that money in transit indicates that he invested approximately $200m in condominiums, homes, office condominiums, luxury automobiles, and five yachts. The yachts alone are believed to have cost over $20m. Only one was recovered.

Here's what bothers me; all of his extensive real estate investments, held in the names of corporations with bearer shares*, appear to have been taken from him, in his absence. A complete list would only be known to Murcia, but so far, I have found that apartments in these properties were stolen from him:

(1) Trump Ocean Club
(2) AguaLina and AguaMare, in Punta Pacifica
(3) Offices in the Global Bank Building
(4) Revolution
(5) Star Bay
(6) Venetian
(7) Q Tower

Bearer shares, who were assigned for the limited purpose of property management, appear to have been fraudulently converted to fraudsters working with notary publics, who notarized signatures without seeing them personally executed by Murcia. Unfortunately, this type of corporate fraud is a common occurrence in Panama, targeting foreign nationals who place their trust in professionals who promptly steal their clients' property, and place it in their own names.

The property is then generally sold to third parties, who sell it to others, This apparently places the future owners in the legal position of bona fide purchasers,  extinguishing Murcia's claim to all his assets.

Who benefitted from these thefts ? Murcia's closest known business associates were President Martinelli, and his business partner, Gary James Lundgren. They are known to have had access to the documents necessary to accomplish the unauthorised transfers of corporate ownership, and to have openly bragged about the millions of dollars that they were receiving from Murcia. Perhaps someone might wish to ask them.

                                                                   Gary Lundgren
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*Bearer Shares Fraudsters fleece foreigners in Panama