Vanuatu goes after US$7.5 million in laundered money

By Marc Neil-Jones

The Vanuatu government could find themselves with a US$7.5 million (v 982 million) windfall cash gift if the Public Prosecutors office are successful in

convicting a Vanuatu registered

international company Benford Ltd of laundering money here from the illicit proceeds of one of the biggest credit card frauds in history.

In May last year the European Bank, a Vanuatu commercial bank affiliated with Pitco received over a period of a few months US$7.5 million to be credited to an international company Benford Ltd.

The funds were transferred from the Cayman Islands and bank officials and director Tom Bayer was suspicious enough

to alert the police. Lawyers, Ridgeway

Blake, obtained a court order freezing the funds after they were contacted by investigators in the Cayman Islands who had closed down a bank involved in laundering funds worldwide - including to Vanuatu. They had access to documents showing where funds had been transferred.

The Public Prosecutors office was alerted when the court order freezing the assets was given in July.

The police got involved to investigate the case and then Mark Hurley of George Vasaris & Co was approached by Robb Evans, who was appointed by the US District Court of California to get the court order to freeze the money lifted and return it to the USA to reimburse it to people who had been defrauded.

He is acting on behalf of nearly one million credit card owners who have been milked out of vt5.9 billion (US$45 million) through an Internet credit card fraud scam.

The credit card fraud was brilliant and effective. It was run by 47-year-old Robert Taves through a Malibu, USA company called Netfill who billed 900,000 credit card holders worldwide for Internet services they didn’t order in one of the largest credit card scams in history. The company accessed credit card numbers from users of their Internet porn sites worldwide and from databases of credit

card holders. The accounts were debited in most cases US$l9-95, (vt2633) a small sum that most people with credit cards would not notice and the scam prospered.

So much so that Netfill took in more than U 5549.4 million last year, only a fraction of which came from access to porn sites on the Internet, a business front for the company.

Credit card deductions were forwarded to ATS who are a credit card processing firm in California along with lists of credit card numbers with instructions to debit the accounts. An FBI officer was quoted in the Los Angeles Times saying, “The extent of the alleged scam was off the scales.”

US authorities investigated frequent

trips by Taves to the Cayman Islands and later traced some US$25 million had been laundered to offshore accounts and tax havens including the US$7.5 million to the European Bank here.

It is believed that the funds were sent accidentally to Vanuatu thinking that the European Bank was an offshoot of the Euro bank in Caymans where most of the money went and which was closed down as a result of the scam.

Robb Evans has been travelling the world tracking down the missing money.

“There are a couple of countries in the Caribbean, a couple in the Channel islands, one in Europe and Vanuatu where stolen money was sent. So far we have traced around US$2O million but unfortunately Vanuatu is the only country that is trying not to return the funds to the

rightful owners.

“It is early days yet and we are confident that they will see that this large sum of money is not the proceeds of crime but was stolen from people and we are simply asking for the stolen funds to be returned. Governments all around the world cooperate with each other when it comes to fraud,” he said.

This view is not shared by the Public Prosecutors office who are taking the case to court under the Confiscation Of Funds

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Satellite technology is used to "transfer" funds from one offshore bank to another elimi nating paper trails and eventually "cleaning" money from illegal operations

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Under the Proceeds of Crime Act 50 of 1989. In the past there have been one or two cases where the Vanuatu government have confiscated up to $2 million dollars of funds sent in through Vanuatu.

This time, however, the amount is significantly higher and members of the Finance Centre believe that if the government does confiscate it, a clear message will be sent to the outside world not to launder the proceeds of crime through Vanuatu’s Finance Centre.

This case is however a sensitive one.

Vanuatu may have a fight on its hands if it tries to confiscate the funds owing to ordinary people around the world that the court in California, USA has ordered to be returned.

Heather Lini Leo, the Public Prosecutor

has confirmed that Judge Oliver Saksak has upheld the request of their office to keep the funds frozen and not release them to the USA but the battle with the USA is far from over. They will need to prove that the funds were proceeds of crime before they can confiscate the US$7.5 million and Evans has promised to fight it in a costly litigation battle.

The Public Prosecutor has advised that the European bank in Vanuatu has co operated with the office of the Public Prosecutor and police, however he refused to make any comment on the case as he advised, “I am bound by the International Companies Ac and cannot divulge any information on Benford Ltd.”

Meanwhile Taves is in jail in the USA pending a trial. ■

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