The BVI and Belize offshore companies have assets (assigned loan agreements) that link them to a Quinn family company called Demesne Investments Ltd. The loan agreements are affecting the ability of IBRC to seize an office block in Moscow, Russia, valued at up to US$180 million and a shopping centre in Kiev valued at up to $60 million. The buildings are believed to be producing annual rental income of approximately $30 million in total, which the state-owned bank has not been able to assert control over.

The Belfast court has told the two offshore companies that they must not deal in the assigned loan agreement or take any steps designed to prevent IBRC from applying to the court to have agreements entered into by Demesne and the offshore companies from being set aside.

The offshore companies named in the case are Lyndhurst Development Trading SA, of the BVI, and Galfis Overseas Ltd., of Belize. The court was told that IBRC has secured a Norwich Pharmacal order from the courts in Belize, instructing Galfis to reveal its beneficial owner. IBRC is pursuing a similar order against BVI-registered Lyndhurst.

Injunction orders were issued in December against Lyndhurst and Galfis. In the case of the BVI company, the court was told that Demesne entered into a loan agreement with another defendant company, Innishmore Consultancy Ltd, and Univermag – the Ukrainian company that operates the Kiev shopping centre, on April 6, 2011. It was also told that Innishmore entered into an agreement with Lyndhurst on October 7, 2011. Then, the BVI company made a supplementary loan agreement with Univermag on November 4, 2011.

On December 26, the judgment order for $45.2 million in favour of the BVI company and against Univermag, registered by the court in Ukraine, was described as “legalised robbery” by IBRC, it also said it expects bankruptcy proceedings to follow.

Mr Rosenfeld had been appointed by by Ed Milliband to mastermind the party’s General Election strategy, after he made a £1 million donation to Labour party.

At the same time since becoming party leader, Mr Milliband has attacked capitalist ‘predators’ and called for a crackdown on tax avoidance. Mr Rosenfield became a tax exile in 2006 when he moved to Geneva and established his Air Capital property empire, incorporated in the British Virgin Islands.

By remaining in Switzerland for five tax years – he returned to the UK last April – Mr Rosenfeld was able to remain exempt from Capital Gains Tax on his property and investments.

In its November prospectus, Fortis warned of “significant doubt about the company’s ability to continue as a going concern” if the Kazakhstan projects did not go ahead. It said if they didn’t, there was no guarantee it would be able to recover US$30 million already paid to their overseas owners.

While Fortis is buying the projects by acquiring shares in a Hong Kong company, the prospectus shows that payments in money and shares ultimately go to Panama and British Virgin Islands. First, Fortis is purchasing HK-registered company Ji’an Resources Investment from its owners, British Virgin Islands-registered company Mainstar Investment, which holds 75 per cent, and another BVI company, United Delight Holdings, which holds 25 per cent. Mainstar is to receive $US1 million and up to 40 million Fortis shares while United Delight, owned by Ji’an director Ya Chen, is to receive up to 15 million shares. Ji’an is, in turn, buying Panamanian-registered Wiyot from its owners for up to US$215 million in cash and scrip. It has already given them a down payment of $US30 million of Fortis’ money.

The prospectus was updated in November to reflect upheaval on the Fortis board. It is believed ASIC wanted the prospectus to include more information about new board members. However, it seems the company was unable to provide updated information before Christmas.

On December 6, Premier Orlando Smith told that the National Democratic Party (NDP) Government has found hardly any financial resources and many financial commitments and bills to be paid. He had pointed out that current projections by the Ministry of Finance indicated that based on the spending patterns for this year, total revenue will be in the region of US$268 million, representing a shortfall of US$18 million compared to what was budgeted and approved by the House of Assembly for the 2011 fiscal year.

According to Hon. O’Neal, Premier Smith revealed that cash advances as of November 4 were slightly over US$40,000,000, but did not take into account the receipt from the Financial Services. He added that while he could not say what the exact figure was, based on previous experience the figures for November could from fifty to sixty million dollars.

Hon. O’Neal also spoke on the claim that the Auditor General Report of 2007 showed that the National Democratic Party left healthy cash balances of eighty-two million and was in compliance with all the provisions of the borrowing guidelines. According to the Opposition Leader, on first reading the claim could seem to be true, but he pointed out that in 2010 the Virgin Islands Party Government had to introduce and pass legislation covering some forty-six million for over expenditure in 2006. He also noted that, prior to being voted out of office at the November 7 elections, the Virgin Islands Party Government put in place some austerity measures and therefore did not to lay off any of the people, or reduce salaries.

The prosecutor said that there would be evidence from six of the seven victims of a series of actions by Mr Elvin, and none of them had received the money back.

When the charges were read to him, Mr Elvin said to each before Judge John O’Hagan: “Definitely not guilty.” The trial continues.

The BVI company has stated that, with the decline of global nickel prices by approximately 23% over the past months, it has experienced serious cash flow difficulties. In a statement posted on the company website it is stated that “There can be no guarantee that alternative finance will be obtained in the near future and therefore (Albidon) believes in suspending operations for the company.”

In July 2011, Albidon projected 2011 output of nickel in concentrate to reach 56,000 tonnes but since that time due to operational problems it had revised the figure.

The liquidators claim that Weavering Capital Fund was controlled by Peterson and used to hide hundreds of millions of dollars in trading losses from investors. Robert Anderson, representing the liquidators, alleges that Peterson misled investors by concealing the fund’s investment in the swaps. Peterson denies the allegations, saying that the swaps were part of the hedging strategy. He also denies lying to investors.

Anderson also claims that the BVI fund made a number of investments at the end of 2008, in the time that Lehman collapsed, to “try to bolster the balance sheet … in case anybody ever started asking questions” about fund’s ability to honour its swap agreements with the Macro fund.

Anderson said to the court that Peterson had “manipulated” the fund’s performance from 2003 – the claim that Peterson denies as well. The case that comes a little over a month after the SFO dropped its two-and-a-half-year probe, saying there wasn’t “a reasonable prospect of conviction” is to continue in London High Court.

According to the civil suit filed in U.S. District Court by the Securities and Exchange Commission, the owner of the fund schemed “to defraud investors through the creation of a false and deceptive appearance of a legitimate, existing (British Virgin Islands)-incorporated pooled investment fund.” The lawsuit states that Locust Offshore Fund Ltd. raised at least $1.6 million since its launch in early 2011.

Hicks said, in his turn, that the fund is “absolutely” set up in the jurisdiction of the British Virgin Islands, and is investing money as it is advertised. On Offshore Management’s website, it is stated that Locust fund “develops and executes sophisticated quantitative strategies across asset classes to produce absolute, risk-adjusted returns with high alpha.” The promotional material on the site also informs that the firm is primarily engaged in the U.S. equity markets and adheres to a market-neutral, risk-averse trading philosophy.

Federal investigators allege in the court documents that the operation is a scam: “Not only does the Locust Fund not exist as a BVI-incorporated company, but Hicks has transferred substantially all the investors’ funds to bank accounts in his personal name and, on information and belief, for his personal use.”

The settlement follows a dispute over national insurance contributions that featured a scheme involving Goldman Sachs Services, an associated company in the British Virgin Islands jurisdiction. In 2005, other banks that used the scheme settled with the Revenue & Customs. In 2010, a tribunal judge David Williams said the British Virgin Islands-registered Goldman Sachs Services was “a way of keeping information about the GS accounts and payroll out of the public domain and confidential”.

Last month, Jesse Norman, an MP on the Common Treasury committee, pressed Mr Hartnett to discuss BVI company’s deal but Mr Hartnett said the Revenue’s lawyers prevented him from commenting.

According to this decision, the U.S. District Judge for the Southern District of New York, affirmed the decision taken in July 2010, recognizing Fairfield Sentry’s liquidation proceeding in the jurisdiction of the British Virgin Islands, as a “foreign main proceeding” under Chapter 15 of the U.S. Bankruptcy Code, which entitled the Joint Liquidators to cooperation and assistance of US courts, in aid of their recovery efforts on behalf of Sentry’s stakeholders.

The Bankruptcy Court’s decision was challenged by parties to a purported derivative action alleged to have been brought in the name of Fairfield Sentry. The apellants argued that granting recognition of the BVI liquidation proceedings was contrary to U.S. public policy due to a sealing order entered in by the court overseeing the BVI liquidation proceedings to protect information contained in the court file that includes litigation strategy or is otherwise confidential or privileged. The District Court denied the appeal.

Kenneth Krys, a licensed insolvency practitioner in the BVI and one of the Joint Liquidators of the Fairfield Funds, said of the District Court’s decision: “We are very pleased with the District Court’s affirmance of the Bankruptcy Court’s recognition order. This important decision provides the Joint Liquidators with continued access to and assistance from United States courts in fulfilling their duties to obtain recoveries for Sentry’s stakeholders in this complex, international liquidation.”

Fairfield Sentry Limited and its affiliated funds Fairfield Sigma Limited and Fairfield Lambda Limited were the largest ‘feeder’ funds into the notorious Madoff’s Ponzi Scheme.

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