MISSING CAYMAN GANG OF FOUR FRAUDSTER RESIGNS DIRECTORSHIP IN CANADA

Derek Buntain, the president of Dundee Merchant Bank, the Grand Cayman brass-plate bank accused of illegally transferring more than USD$450m, and a reputed member of the criminal conspiracy known as the Cayman Gang of Four, has abruptly tendered his resignation, as a director of Dundee Precious Metals, Inc., a position that he had held for twenty-two years. Dundee Merchant Bank is a defendant in a civil suit, brought by one of the Canadian victims of what some believe is a Ponzi scheme, operated by the Gang of Four, who covertly took possession of investor funds entrusted to the bank. The bank, and Dundee Precious Metals, are both reported to be subsidiaries of Dundee Corporation.

Buntain has been missing and unavailable since the summer of 2015, when the scandal involving the missing money became public knowledge. He has accused, by Sharon Lexa Lamb, of drafting the instrument that was used to deceive investors into believing that B & C Capital, Ltd., a shell company operated by a known fraudster, Ryan Bateman, was a financial institution. Lamb made that statement, in the presence of several eyewitnesses in Grand Cayman, when she was confronted regarding the missing $450m. Journalists have sought to locate him on Prince Edward Island, without success. He has a residence and extended family living there, and a show horse, but he cannot be found after diligent search and enquiry.

Derek Buntain

TD BANK OFFICER WHO AIDED ROTHSTEIN PONZI SCHEME GETS SHORT SENTENCE

Frank Spinosa, the TD Bank Senior Vice President who wrote the infamous "lock letters," which falsely warranted that the bank had large restricted accounts for the investors in Scott Rothstein's bogus court settlement Ponzi scheme, was sentenced this week to two and one-half years in Federal Prison.  Spinosa was terminated by the bank when the details of the billion dollar fraud came to light.

The sentence handed down in US District Court* was shorter than the recommended guidelines, and there were some health considerations, but some observers may question the length of the sentence, inasmuch as the defendant was a banker, and one of the purposes of sentencing is to act as a deterrent, to prevent others, similarly situated, from considering engaging in criminal conduct. Was the sentence to short, given the size of Rothstein's Ponzi scheme, and its impact upon the victims ?

The other issue, which will now not be resolved, since Mr. Spinosa has entered a plea, and there will never be a trial, is whether any other senior officers at TD Bank had any knowledge of the Rothsteib fraud; he was a lucrative client for the bank, and even the most rudimentary due diligence inquiry would have revealed that there were no lawsuits filed, to support Rothstein's claims of a boatload of  employee discrimination, and sexual harassment lawsuit settlements available for investors.

In any event, Mr. Spinosa, who had experienced legal counsel, ends up with a relatively short sentence, when compared to many of the other 28 Rothstein defendants. Whether there will be any others ultimately charged in this scandal, including other TD Bank officers, is not known.
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* United States vs. Spinosa,  Case No.: 14-60257-CR-BLOOM (SD FL).

DRUG CASH SEIZED IN PANAMA

Drug profits continue to flow into Panamanian banks.This is $856,000 in cash, located in the back of an automobile, which was seized in the Republic of Panama in a drug money laundering investigation. According to the authorities, it represents narco-profits generated by traffickers in Guatemala & Honduras.

DEATH SENTENCE FOR CHINESE PEP WHO KILLED BRITISH BUSINESSMAN COMMUTED TO LIFE

A court in Beijing has commuted the death sentence given to Gu Kailai, the wife of the former prominent Chinese politician Bo Xilai, to a life sentence. Gu was convicted of murder in the death of British businessman, Neil Hayward, in a high-profile case that exposed the sordid underbelly of rampant corruption among China's elite. Her cold and calculating nature, and arrogance, caught the attention of all those who considered China as a golden opportunity.

The Gu case, where the greedy quest for bribes and kickbacks, of the two PEPs, was detailed, to the discomfort and pain of the Chinese Government, served as a wake-up call for Western businessmen seeking to turn a tidy profit by doing business in China. Since Gu, most Westerners have become more cautious with China, particularly in matters where their expected conduct, the illegal payment of gratuities, violates the corrupt practices laws of their home country. Bo Xilai is also serving a life sentence, after a conviction for corruption.

THE CAYMAN GANG OF FOUR THREATENED INVESTORS WHO REQUESTED THEIR MONEY

The Cayman Gang of Four had a policy for dealing with their victims; how to discourage any of the over sixty Canadian & American investors who requested that some of their money be sent to them: lie, deny and, if necessary, threaten. When an investor asked for a wire transfer of a portion of their funds, the Gang, and specifically Sharon Lexa Lamb, would throw up any one of an assorted list of excuses, none of which were true.

For example Lamb, who was answering "Dundee" to all callers, notwithstanding that she had been fired more than a year earlier, would tell callers that there were delays, due to compliance requirements, at the 'bank' where the funds were kept. (of course, the money was held by Ryan Bateman's shell companies, not a bank) Alternatively, she would ask the victims for information on their Source of Funds, even though the money had been passed through two prior financial service firms in Canada. These were lies to delay access to the clients' money.  Was this a violation of her fiduciary obligations ? You bet it was.

Finally, when these excuses were ineffective, Lamb would threaten to turn in the victim to his or her the tax authorities, reporting them for tax evasion. Whether some of the victims had not reported all their income on investments to the taxman is not relevant, for Lamb was desperate to avoid the truth: Ryan Bateman and the Gang of Four had their money, and it was gone forever, as are Bateman, Derek Buntain, and Sharon Lamb who notwithstanding her statements, has not been seen in public in Grand Cayman since the civil suit was filed against her.

Of course, the pressing question is : Where is the Cayman Islands Monetary Authority (CIMA) on this ? Asleep at their desks ? Who will wake them up ? Will it take UK intervention at CIMA to get justice in this case ?

ISIS POSSESSION OF TEXAS PLUMBING COMPANY TRUCK MEANS TURKEY IS NOT A SAFE DESTINATION FOR YOUR CUSTOMERS' EXPORTS

The disclosure yesterday, that a Texas plumbing company is suing AutoNation for $1m, when a truck it sold the vehicle auctioneer ended up in ISIS hands, means that Western bank compliance officers should reexamine any and all international trade transactions between their clients, and customers in Turkey. It is one thing to read about ISIS oil being sold in Turkey, and another to see the logo of your American company on a truck being used in Syria, by terrorists. AutoNation, after promising to remove the logo, negligently failed to do so. and thereafter sent the truck to Mersin, in southern Turkey, a stone's throw from Syria. Doesn't the company have any compliance officers over there ?

Frankly, the time has come for bankers to advise their clients to avoid all trade and financial transactions with Turkish companies, lest they end up publicly named & shamed by OFAC, in an expensive and embarrassing Civil Penalty fine case. Turkey is obviously providing assistance to ISIS; it is immaterial to know whether its companies are being paid. The prudent thing is to red-line all transactions at this time, and to advise bank clients that they jeopardize their relationship at the bank by ignoring your advice. 

WHERE ARE THE TWO CANADIAN GANG OF FOUR MEMBERS WHO FLED THE CAYMAN ISLANDS ?

Derek Buntain

Derek Buntain is a Canadian national who was the President, and Director, of the Dundee Merchant Bank, and who is one of a group of four financial professionals who were reportedly responsible for the illegal transfer, from Dundee, of over $450m in investor money. Buntain, and former Senior Vice President & Director, Sharon Lexa Lamb, have been accused by their victims of committing a breach of their fiduciary responsibilities, in transferring the funds to a shell company, purporting to warrant and affirm, in writing, that it was a financial institution

He has been missing for a number of months, but is believed to be living on Prince Edward Island (PEI), where he has a home, and where other members of his extended family reside. Internet traffic indicates, with a high degree of probability, that he is monitoring the news of the first civil suit, brought by a victim, against Ms. Lamb and the Dundee Merchant Bank, from PEI. he has not returned to his residence in Grand Cayman.

Buntain, far right, with his racehorse

Ryan Bateman, a native of Alberta, and the owner of the shell investment companies, B & C Capital, Ltd., Bateman & Company, Ltd., and Bateman Capital is believed to have transferred, without authorization, all the capital of the victims into his corporate operating accounts, and thereafter, to have engaged in multiple transactions, involving the purchase and sale of securities, through financial institutions located within the United States, and in the Bahamas.  He failed to appear for a criminal trial in the Cayman Islands, where he is a defendant, and is regarded there as a fugitive. His efforts to sell his expensive Cayman residence, and to transfer the funds out of the country, reportedly were blocked by the authorities.

Ryan Bateman

Bateman, based upon Internet traffic monitoring, is reportedly living quietly in the State of Florida, most likely in South Florida. Due to the violent nature of his pending criminal case, and his obvious wish to avoid publicity, readers are urged not to interact with him, in any way, should you come into contact with him.

Don't these two Canadians have licenses to sell securities ? Should they not be under review at this time ?

LEADER OF CAYMAN GANG OF FOUR COUNTERSUES VICTIM & WHISTLE BL0WERS FOR DEFAMATION

Sharon Lexa Lamb, the reputed leader of the Cayman Gang of Four, who is being sued for the theft of $450m, by a Canadian investor, has filed a counterclaim for defamation, against the plaintiff, as well as two whistle blowers, including this blogger, in an effort to control further news about her central role in the massive Cayman Islands trading scandal. She also has avoided any responsibility for the losses, which occurred when Lamb illegally transferred the victim's funds, which was a violation of her fiduciary responsibilities.

Lamb, who has previously threatened legal action, should her name be mentioned in coverage of the illegal transfer of investor money to a shell company controlled by a known fraudster, Canadian national Ryan Bateman, alleges that the plaintiff, a prominent retired Toronto attorney and Queen's Counsel, improperly assisted whistle blowers, by giving them details of the case, including threats and demands made by Lamb's counsel, which counsel did not want made public. The plaintiff has reportedly denied the defendant's allegations.

Suing a whistle blower, what is generally referred to as "shoot the messenger," is a futile effort to control the flow of news about the case to the investing public, including the other sixty victims of the Gang of Four, who are financial professionals accused of looting hundreds of millions of dollars of investors' money, for their own use. Lamb alleges that the news about the scandal amounts to defamation, though the truth about her prominent role in the fraud is supported by documentary evidence.

 The case has been cited as a prime example of the repeated failure of the Cayman Monetary Authority, CIMA, to take any action to protect foreign investors who lose assets placed in the Cayman Islands. CIMA has not shut down B & C Capital, Ltd., the Gang's corporate entity, which took the victims' money, nor even interviewed the members of the Gang of Four, who are Sharon Lexa Lamb, Ryan Bateman, Fernando Mota Mendes, and Derek Buntain. Is CIMA merely a paper tiger, who never displays its regulatory enforcement teeth, when confronted with financial crime ? Should it be disbanded, and replaced with an effective agency ?

Ineffective and toothless ?

  

WILL PANAMA NOW DEMAND THAT THE UNITED STATES EXTRADITE RICARDO MARTINELLI ?

Panama's former president, Ricardo Martinelli, failed to attend a mandatory appearance before a court in Panama City,where he is charged with conducting illegal electronic surveillance, and he has been held in contempt of court. On then-President Martinelli's orders, his National Security Council illegally intercepted email, telephone call, and other communications, where there was an expectation of privacy.

Martinelli, who faces a potential maximum sentence of twenty-one years of imprisonment, spied upon over 150 Panamanians, who were opposition leaders, journalists, and prominent members of Panamanian society and industry. He allegedly fears for his physical safety, should he return to Panama, and has claimed that he cannot get a fair trial at this time. The ex-president faces a dozen other cases in Panama, and there has been a growing movement, among Panamanians, for him to face justice for his corruption, human rights violations, and illegal surveillance program.

The Supreme Court of Justice can now file extradition papers in Washington, seeking Martinelli, who is now living comfortably in Miami, where many former dictators have retired to. The question is, will reformist President Varela demand that it take that step ? Or will Martinelli have the last laugh, at the expense of the people of the Republic of Panama ?   

GANG OF FOUR RINGLEADER RAN OUTLAW BANKING OPERATION AFTER TERMINATION BY DUNDEE BANK

Sharon Lexa Lamb, the leader of the Cayman Gang of Four, ran an illegal operation after she was terminated by Dundee Merchant Bank in 2013, deceiving investors in believing that she was still affiliated with the bank. Lamb took over the bank's telephone number, and, answering it as "Dundee," defrauded Canadian and American retirees, by facilitating the unauthorized transfer of their assets to B & C Capital Ltd., to fugitive trader Ryan Bateman. An estimated $450m cannot be found, and is feared lost.

In a court filing, in a case pending in the Grand Court of the Cayman Islands, Dundee Merchant Bank, through its attorneys, has stated that Lamb's employment, as Senior Vice President "terminated on December 31, 2013, and thereafter Ms. Lamb had no relationship with TDMB [the Dundee Merchant Bank], or any other company in the Dundee group." Lamb, who is a defendant in that case, is known to have represented herself as a bank representative, to individuals who called the bank's number, until the scandal broke, in the summer of 2015, falsely assuring investors that their money was in safe hands at a financial institution, B & C Capital, which was a shell company owned by a career criminal.

In truth and in fact, their money was being illegally traded by B & C Capital's Ryan Bateman, who had fled Canada after engaging in securities fraud there. It is not known what Bateman did with the missing money; he failed to return to the Cayman Islands to face a felony charge, and promptly disappeared. Some sources claim that he is living in the United States.

The import of the Dundee Merchant Bank filing is that Sharon Lexa Lamb held herself out as a bank officer, years after she was fired. She, and former bank president, Derek Buntain, were reportedly ordered to liquidate the bank, by Canadian regulators, after its parent was sold, but intentionally failed to do so,and ran an illicit operation, for their sole financial benefit, with millions in client money. Buntain has fled to Canada, and his current whereabouts are unknown; he is believed to be living in Prince Edward Island. Lamb has denied liability for the losses suffered by the victims, refused to turn over documents, and will not cooperate, unless and until she receives immunity from criminal prosecution.

CENTRAL BANK OF CYPRUS FINES FBME €1.2m FOR AML/CFT FAILURES

Lebanese-owned FBME Bank Ltd. (Cyprus), more commonly known by its former name, the Federal Bank of the Middle East, has been fined 1.2m Euros, by the Central Bank of Cyprus, for both money laundering, and terrorist financing, deficiencies. This action has been expected for some time, though the size of the fine was a surprise.

 The bank had previously been listed, by the United States, as a financial institution of Primary Money Laundering Concern, and denied access to the American financial structure. The US action contained findings of fact:

(1) The bank was involved in the financing of Hezbollah, a Specially Designated Global Terrorist entity.

(2) The bank did business with organized crime.

(3) The bank allowed known fraudsters to operate accounts there.

(4)  The bank was engaged in sanctions evasion activities involving Syria.

FBME, a subsidiary of a Lebanese bank, operated in Cyprus, though it has gone through a number of jurisdictional relocations, including a period where it was domiciled in the Cayman Islands. Its current base is in Tanzania, though 90% of its business was through its Cyprus branch. 

Readers who wish to review the complete text of the Central Bank statement oh the imposition of the fine can access it here.

GUILTY EX-CIFA HEAD JEFFREY WEBB NAMES PANAMANIAN CORPORATIONS IN FIFA CORRUPTION SCANDAL

Jeffrey Webb:Guilty

Jeffrey Webb, the former head of the Cayman Islands Football, and who had pled guilty to his involvement in the massive FIFA corruption probe, has been cooperating with US law enforcement authorities in their investigation into the payment of millions in bribes and kickbacks. His assistance has reportedly been a major factor in the recent indictment of additional FIFA executives.

Webb was the Business Development Manager at the local Western Union money service business, which was closed without warning in July; Webb was arrested in May. The MSB was a subsidiary of Fidelity Bank (Cayman) Limited, whose parent, Fidelity Bank International, Limited, is located in Nassau. Bahamas.

WUs abrupt closing: due to Webb's arrest ?

Fidelity was one of the financial institutions named in the superseding indictment, for having moved a portion of the bribe money paid to him. Webb reportedly has named more than one dozen Panamanian corporations as entities through which bribe payments were facilitated to those individual indicted.

RAISE COUNTRY RISK ON BELIZE

A recent increase in money laundering activity in Belize will only be stimulated further by the new nonstop service from Panama to Belize that was initiated this week by Copa Airlines. Money laundering Panamanian attorneys have increasingly turned to Belize, to conduct their illicit operations, and there does not appear to have been any meaningful local law enforcement response by Belizean law enforcement agencies or regulators.

There have been multiple cases involving a Belize nexus in 2015. Toronto authorities announced this week two arrests in the $93m pyramid scheme known as Banner Brokers, where the schemers used accounts in Belize to launder the proceeds of crime, employing a bogus Internet advertising company. The United States has accused the Government of Syria of purchasing oil from ISIS, in violation of international sanctions, and a Belize company has been sanctioned for being a major participant. We have seen several other new cases this year, involving Belize banks, and American and Canadian fraudsters and securities traders.

In the past, the country's financial institutions have banked Convicted Colombian billionaire Ponzi schemer David Murcia Guzmán, the insider trading Panamanian government officials in the Financial Pacific-Petaquilla Mining scandal, and the admitted Panama City money launderer, attorney Ismael Gerli.

Given the country's small economy, and lack of significant trade with North America, the chances that any financial transaction between Belize financial institutions, or corporations, involves only criminal activity has increased in recent years, as its popularity for illicit activity has soared. Now, due to increasing the ease of access, for those in Panama's legal profession who regularly engage in the laundering of the proceeds of corruption, and narcotics trafficking, one can only expect it to continue to rise.

For these reasons, compliance officers should increase Country Risk for Belize at this time, after making their own due diligence and inquiry.

MONEY LAUNDERING LAWYER IN GRAND CAYMAN NOT CHARGED IN FIFA SCANDAL

The professional football world, already reeling from the fallout surrounding the indictment, and guilty plea, of former Cayman banker Jeffrey Webb, the CACACAF president, and FIFA vice president, on $10m corruption charges, the US Department of Justice brought in additional defendants, in a superseding indictment of other corrupt senior FIFA officials. Webb recently entered a plea of guilty, and is awaiting sentencing, while under house arrest in the United States. He will be disgorging millions of dollars of bribe money.

Buried in the new indictment are the circuitous methods through which Webb received bribes, and those methods are painfully detailed therein. One bribe payment went as follows:

(1) It originated at Multibank, in Panama. From there, it went to...
(2) The bank's correspondent account at Bank of America, in the United States...
(3) For further credit to a Citibank account in Florida.

Who controlled that account, you ask ? An attorney in Grand Cayman, who has close ties to local Cayman football organizations. He was, according to the indictment, called before a Federal Grand Jury, in the United States, to give testimony about the transaction. Remember, when you take the proceeds of crime, in this case a bribe, and move it through the global financial system, to disguise it illicit origin, or to deliver it to the recipient, you have committed money laundering. That is a 20-year felony in the United States.

This unnamed lawyer, whose identity is common knowledge in the financial community of the Cayman Islands, was not charged in the indictment, nor can I find him charged anywhere. Did he receive immunity from prosecution for his cooperation ? Unless there is a sufficient deterrent, when individuals, especially attorneys, who possess special skills, and can artfully hide their dirty clients behind the attorney-client privilege, commit money laundering, others will be tempted to break the law, as they do not fear the consequences.

THE UNITED STATES IS PROTECTING PANAMA'S BIGGEST FINANCIAL CRIMINAL

Who am I referring to here ?

(1) He is living openly in Miami, notwithstanding that a dozen pending cases, some criminal, have been filed against him in his native Panama, but American media have strangely refrained from reporting this fact.

(2) He was singlehandedly responsible for literally bankrupting the budget of the Republic of Panama, through massive corruption, kickbacks and payoffs.

(3) He, and his cabinet ministers, business partners, and other associates, illegally made many millions of dollars, through insider trading of securities, in the Petaquilla Gold Mine scandal.

(4) He laundered millions of  dollars, much of which was Colombian narcotics profits, for convicted Ponzi schemer, David Murcia Guzmán.

(5) His illegal surveillance program invaded the privacy of over one hundred Panamanian judges, opposition politicians, and prominent businessman, and their wives, and he forced their wives and girlfriends to engage in sexual relations with him, through blackmail. and threats of exposure.

(6)  He ordered Panama's regulators to ignore rampant money laundering in the country's banks and money service businesses, and insured that any civil suit brought by his opponents went nowhere, through bribes, intimidation, and the granting of favors to the judiciary, including many members of the Supreme Court of Justice.

(7) While in office, he associated with many prominent members of Panama's organized crime syndicate, which includes many players of Middle Eastern (e.g. Syrian) origin.

The individual who committed all these acts is the former Panamanian President, Ricardo Martinelli, who apparently has been a Confidential Informant for A US law enforcement agency for an unknown period of time, and is now enjoying the benefits of residing in Miami, with all his ill-gotten billions of dollars, so long as he continues to give up information on Panamanians engaged in criminal activity, including corruption. Indeed, Martinelli may have played a major role in supplying the evidence used to convict several major Panamanian government officials of late.

Martinelli has the proverbial "Get out of Jail" card in the United States, and Panama's new reform government is the loser. You could say that crime pays, when you have high-level friends in an agency of the US law enforcement community, that has little or no accountability to the US Congress, or the American public, for its conduct. Is the war on drugs that important that we continue to give the worst career criminals a pass, so long as they assist us ?