in jail

"Finance consultant" to serve 18 months in jail

By Patrick Decloitre

VANUATU’S court of appeal has ended a legal battle sparked by a scam that could have bankrupt ed this country.

Australian Peter Swanson was trans ferred to Port Vila’s tiny jail after a Court of Appeal upheld an earlier sentence of 18

months imprisonment.

In February, Swanson was found guilty by the Vanuatu Supreme Court of seven charges including forgery, false statements to induce people to invest and dealing in

securities without a licence. Australian Federal Court judge John William Von Doussa, who presided over the four-man appeal bench, sustained five of the seven counts Swanson was convicted of and upheld the 18-months sentence.

Appeal courts in Vanuatu sit on an ad hoc basis and consist of foreign judges des ignated from a judges' roll in the region.

Swanson, who once described himself as a "financing consultant”, was arrested in Port Vila in June 1996, only a few days before a damning ombudsman report rocked Vanuatu and described him as the central character in an alleged "letters of guaran-

H tee” scam. The report I showed he had ■ promised to raise 250 I million US dollars in a I few months if the I Vanuatu government I issued 10 letters of ■ guarantee (effectively I lOUs) of 10 million US I dollars each, totalling I some 100 million US.

The ombudsman’s I report also evidenced I the letters had been I signed by then Prime I minister Maxime I Carlot, his Finance min- I ister Barak Sope, Sope’s I first secretary George Borugu and then ■ Reserve Bank Governor I Samson Ngwele.

The four were not prosecuted.

Three other alleged I foreign accomplices, I who had left Vanuatu’s I jurisdiction, were not I prosecuted either.

Briton John Baxter Wright, who acted for I Vanuatu’s public prose ■ cution throughout the r case, earlier told the I court there was no sug- I gestion Carlot and I Ngwele were co-offend- I ers.

“We suggest they I were victims”, he said, I answering a defence I claim suggesting I Swanson, being the I only one prosecuted, I was a scapegoat. ’The reason why (Swanson) is the only one in the dock is very clear : we say it was he who was central, instru mental to this whole scheme”, Baxter-Wright told the Supreme Court.

Throughout the

enquiry, Swanson, from Adelaide, refused to give details on his. rela tions with the four top officials.

After it was unveiled, the scheme, which could have bankrupted this archipelago, was swiftly halted, the ten letters’ originals retrieved in London and brought back to Port Vila with the help of Scotland Yard and Interpol.

But the scandal indirectly caused Carlot and his cabinet’s downfall in a motion of no confidence in September that year.

Swanson initially spent six weeks in Port Vila’s jail and was then released after pay ing a 10 million vatu (77,000 US dollars) bond.

“It remains a matter of speculation as to what precisely (Swanson) would have done with those guarantees, but whatever his intentions were, the court found they were dishonest in nature”, Baxter-Wright said after the verdict.

“This is important for Vanuatu, because it shows the authorities were prepared to take a bold and expensive step for them to prosecute perpretators of fraud who visited this island nation”.

During the prosecution, experts were brought here from around the world at an estimated cost of 20 million vatu (155,000 US dollars).

“Vanuatu’s decision to meet those costs has been fully vindicated and sends out the right message to potential fraudsters not to visit these islands”. ■

peter Swanson