In the beginning of May, BVI court confiscated more than US$45 million from a Bermuda-based IPOC International Growth Fund Ltd. which pleaded guilty of serious frauds. Further on, Justice ordered three other defendants – BVI-registered companies Lapal Limited, Albany Invest Limited, and Mercury Import Limited – to pay a total of $2.2 million in costs and $300,000 in fines for their part in the offences. The court order, which prosecutors say may be the largest court order of its kind ever made in the Commonwealth, came after a 17 month investigation by authorities in the British Virgin Islands and Bermuda, and after the Bermuda- and BVI-based companies pleaded guilty to providing false information and perverting the course of justice. Criminal charges were filed against the four companies on April 21, and the defendants were committed to the High Court on April 25.
It was alleged that between 2004 and 2005, the IPOC group gave wrong information about the source of $40 million which had been lodged with the court as part of a separate, civil matter. At the centre of that legal case there was a long dispute between IPOC and Alpha Group. Through its lawyers in the BVI, Alpha alleged that $40 million in legal costs put up by IPOC were sourced from the proceeds of crime, but it was argued by IPOC that the money originated from consultancy services supplied to a number of companies, including those registered in the U.S. A matter settlement agreement was concluded in the end of November 29 between the IPOC Fund and BVI-registered LV Finance Group Limited, owned by Alpha Group.
The investigation and prosecution of the IPOC case by the BVI authorities was carried out with the co-operation of authorities in Bermuda; a Memorandum of Understanding concerning the IPOC investigation was signed between the two jurisdictions in July 2007. The Bermuda and BVI governments spent a combined $2.3 million on the investigation.