Common methods for concealing assets and Minneapolis money manager Christopher Pettengill-

  • The January 4, 2011 “Asset Search News Roundup” advised that assets are routinely hidden by utilizing portable valuable commodities like diamonds, bulk cash smuggling and checks & wire transfers.  Another common method for concealing assets is trade-based money laundering.  As p.19 of “Money Laundering Vulnerabilities of Free Trade Zones” stated, trade-based laundering “include[s] under and over-invoicing, phantom shipments and other falsification of the value or quantity of a shipment…”  One trade-based laundering scheme, is analyzed at the following hyperlink.
  • The Court’s June 21, 2011 docket entries demonstrated that Minneapolis money manager Christopher Pettengill pleaded guilty to the securities fraud, wire fraud conspiracy and money laundering charges described by his felony information.  According to a June 13th Star Tribune article, these charges were connected to Trevor Cook’s $194 million Ponzi scheme.  The post “Money Laundering By Minneapolis Money Managers?” earlier explained that Mr. Pettengill and Mr. Cook were initially named in a civil lawsuit asserting claims against them for fraud, conversion civil theft, etc.  As that post suggested, Mr. Pettengill could have facilitated part of his frauds by displaying to victims what might be a meaningless chart:

 

Copyright 2011 Fred L. Abrams

“The Premier And The Hip-Hop Magazine” published by Forbes on March 3, 2010, observed that special prosecutor Helen Garlick had so far not filed public corruption or other charges against former Turks & Caicos Islands premier Michael Misick.  The March 3rd article also pointed out that the former premier and his ex-wife U.S. actress LisaRaye McCoy, were alleged to have invested monies in the US-based Hip Hop Weekly magazine.

$300,000 dollars for example, might have been transferred in 2007 to Hip Hop Weekly through companies known as My Way Productions 2 and the Windsor Investment Group.  The former premier and Ms. McCoy seemed deeply involved in My Way Productions 2, as more fully set forth at “The Former Premier’s Nexus To Hip Hop Weekly Magazine” and “The Actress, An Ex-Premier & Hip Hop Weekly Magazine“.  Windsor Investment Group meanwhile, was apparently partially owned by the former premier and his brother, Chal Misick.

The former premier, Ms. McCoy, Chal Misick and the Windsor Group are now thought to possibly be subject to a June 23, 2011 restraining order which allegedly froze the former premier’s assets worldwide.  The Turks & Caicos Sun has reported that the alleged June 23rd order “was made” by special prosecutor Garlick and that it lists the former premier, Ms. McCoy, Chal Misick, the Windsor Group and others.

Continue Reading Former Premier Misick Reportedly Subject To Worldwide Asset Freeze

At an April 26, 2010 Moneylaundering.com article*, I basically explained that the damaged investors of a Ponzi scheme can not successfully recover money damages on the ground that a financial institution violated the Bank Secrecy Act:

(To Read The Article, Click On The Image Above)

This Moneylaundering.com article mentioned a 2009 lawsuit damaged investors brought against Wachovia, etc. and another one filed against Associated Bank.  The damaged investors filed the lawsuits against Wachovia and Associated pursuant to the Bank Secrecy Act and otherwise.  According to the damaged investors, they lost investment monies because securities fraudsters had laundered Ponzi proceeds by abusing these financial institutions.

In applying the same kind of reasoning set forth by the Moneylaundering.com article, the Wisconsin Court of Appeals recently affirmed the dismissal of one of these lawsuits.  At pp. 9-10, paragraphs 21-23 of its June 7, 2011 Opinion, the Wisconsin Court of Appeals indicated that damaged investors did not possess a cognizable claim against Associated Bank, under the Bank Secrecy Act.

*"Florida Court Unlikely to Find Wachovia, Mastercard Civilly Liable for Missing Ponzi Scheme", Copyright 2010 Alert Global Media, reprinted with permission.

Copyright 2011 Fred L. Abrams

The Ministerio Publico and the General Prosecutor of Guatemala assert that ex-president of Guatemala’s Congress Reuben Dario Morales Veliz, could have received graft payments in a public corruption scheme.  Payments believed to be connected to the alleged corruption scheme may have been laundered through Guatemalan and U.S. bank accounts.

To collect evidence regarding one of these U.S. bank accounts, the Guatemalan prosecutors drafted a letter rogatory which was filed on May 21st in Miami federal court pursuant to the Inter-American Convention on Mutual Assistance in Criminal Matters, (U.S.-Guatemala, September 3, 1997, S. Treaty Doc. No. 105-25 {1997}).  As a review of page six of the letter rogatory shows, the prosecutors seek opening documents, signature cards, etc. for a particular bank account at the Miami-based TotalBank: 

(Click Below To Read The Letter Rogatory)
  

Besides this post, the following are about collecting evidence from bank witnesses-  Eliciting Evidence From Foreign Bank Witnesses; Eliciting Financial Evidence Across International Borders; and Foreign Bank Secrecy Laws & An Asset Search.

Copyright 2011 Fred L. Abrams

The June 8th “Asset Search News Roundup” covers Holocaust-era assets and the Egmont Group of Financial Intelligence Units.

  • By its December 16, 2010 decision, the Second Circuit affirmed the dismissal of the Holocaust-era assets case known as Grosz v. Museum of Modern Art.  The December 16th decision is now the subject of a certiorari petition filed with the U.S. Supreme Court.  The petition argues that the December 16th decision “…sanctioned a departure from the traditional role of U.S. courts as a post-War means of redress for victims of theft of readily identifiable property during wartime…”

  • The Egmont Group of Financial Intelligence Units fights money laundering and terrorist financing by promoting information sharing between governmental authorities.  Its webpage available here, even features a video describing how money launderers and terrorist financiers secretly transfer assets.The Egmont Group additionally publishes its money laundering typologies which analyze various methods for concealing assets.  One of these money laundering typologies describes the use of foreign banks to hide assets:

Money Laundering Typology: Courtesy of The Egmont Group

Copyright 2011 Fred L. Abrams

To combat the secretion of money via laundering, the Isle of Man developed its own anti-money laundering handbook.  Just a few of the the Island’s anti-money laundering regulations are:

Agencies like the Isle of Man Constabulary Financial Crime Unit  and the Financial Supervision Commission generally administer such regulations.  Despite this comprehensive regulatory scheme, there is still cause for concern that Internet gambling on the Isle of Man especially creates a money laundering risk.  The pending U.S. prosecution against the principals of PokerStars perhaps highlights this laundering vulnerability.

Continue Reading Secreting Money Via Internet Gambling On The Isle Of Man

Piercing trusts and competing over $1.2 million dollars in the Trevor Cook asset recovery case–

  • “Concealing Assets In More Than 150 Trusts?” describes some matters in which assets were fraudulently hidden.  When available, the right to pierce a trust could lead to a recovery in these situations.  In New York for example, Courts can pierce the trust veil where the trust is formed for an illegal purpose and there is no separation between the beneficiary and the trustee.A trust may too be pierced under New York law if the trust is used to conceal assets or in fraudulent conveyances, to shield funds from adverse judgments.  Babitt v. Vebeliunas (In re Vebeliunas), 332 F.3d 85, 91 (2d Cir. 2003).
  • A dispute has arisen among claimants trying to interdict $1.2 million dollars maintained by securities fraudster / Ponzi schemer Trevor Cook in a UBS financial account in Switzerland.  A memorandum of law reveals that both the Trevor Cook receiver and Mr. Charles D. Hendrickson of Forest Lake, Minnesota, have asserted competing claimsagainst the $1.2 million:

    (To Read The Memo, Click Below)

(Edited July 12, 2011)

Copyright 2011 Fred L. Abrams

"French Bank Agreement" indicates that Jewish Holocaust victims were paid restitution because French financial institutions had wrongfully seized Jewish-owned bank accounts during WWII.  Holocaust victims who possess claims against the French railway Société Nationale des Chemins de Fer Français (SNCF), might similarly receive restitution.

These claimants seek compensation from SNCF because it was reportedly paid per head per kilometer to assist in transporting at least 75,000 victims in cattle cars, to Nazi death camps between 1941 and 1944.  Although the claimants sought restitution from SNCF by filing a U.S. class action lawsuit, "Nazis’ Human Cargo Now Haunts French Railway" stated that this lawsuit was dismissed in November 2001. 

The 2001 dismissal was affirmed at a November 9, 2004 Court of Appeal’s decision.  The decision explained that pursuant to the Foreign Sovereign Immunities Act (28 U.S.C. § 1603 (b) {1976}), the trial court lacked subject matter jurisdiction over the lawsuit.  Proposed federal legislation could however, finally permit the above-described claimants to seek restitution from SNCF in the U.S. courts:

(CLICK ON THE IMAGE TO ENLARGE)

Copyright 2011 Fred L. Abrams

Today’s “Asset Search News Roundup” is about politically exposed persons and a suspected laundering scheme.

  1. “FAQ” webpage focuses on the legal tools for freezing illicit assets dictators or other politically exposed persons might hide in Switzerland.  Via such tools, Swiss authorities recently froze $1 billion in assets believed to be connected to either Muhammad Hosni Mubarak, Muammar Gaddafi, or Zine al-Abidine Ben Ali.  Articles referring to this asset freeze are at Reuters and the BBC.
  2. A press release and / or restraining order suggest that 76 bank accounts across the globe were allegedly used in a scheme to launder illicit gambling proceeds.  A civil complaint related to the case and an indictment are chasing at least $3 billion through asset forfeiture or from money laundering penalties.  The indictment claims that the principals of three Internet poker companies, (i.e. PokerStars, Full Tilt Poker and Absolute Poker), participated in the suspected laundering scheme.  An April 15, 2011 video from FNN Online also describes the indictment.

 

(Last Edited January 22, 2012)

Copyright 2011-2012 Fred L. Abrams

“A Doctor, A Lawyer & Bricks Of Cash” revealed the role a Liechtenstein trust had in maintaining a secret Swiss bank account.  The February 3, 2010 superseding indictment of former attorney Micaela Renee Dutson and her husband Tony Dutson, too raised the issue of trusts and hidden assets. This indictment depicted below, accused the Dutsons of selling more than 150 trusts in order to conceal millions from the IRS.  Page 2, paragraph 4 of the indictment alleged the Dutsons sold these trusts to their clients as part of fraudulent asset protection schemes:

“Defendants falsely advised clients that they could legally avoid paying taxes by putting their assets and income into the so-called ‘trusts’ that they sold. Defendants also falsely told clients that by putting their assets and income into the so-called ‘trusts,’ they could legally protect assets from seizure by creditors, including the IRS.”

Among other things, the indictment claimed that the Dutsons counseled clients to transfer title of real estate and vehicles to the names of trusts.  By doing this, the clients supposedly concealed their beneficial ownership of assets; and the clients could then lease their assets from the trusts.  On June 11, 2010 the Dutsons were convicted of several federal charges, including violations of 26 U.S.C. §7206 {2}), (assisting the filing of false tax returns).  As the March 9, 2011 entries at the Dutson’s docket report show, the Dutsons were each sentenced to 120 months in prison.

(CLICK ON THE INDICTMENT TO READ IT)

Copyright 2011-2018 Fred L. Abrams