Introduction
1. Former Executive of Loyal Bank Ltd Pleads Guilty to Conspiring to Defraud the United States by Failing to Comply with Foreign Account Tax Compliance Act (FATCA)
2. Adrian Baron, the former Chief Business Officer and former Chief Executive Officer of Loyal Bank Ltd, an off-shore bank with offices in Budapest, Hungary and Saint Vincent and the Grenadines, pleaded guilty to conspiring to defraud the United States by failing to comply with the Foreign Account Tax Compliance Act (FATCA).
3. Baron was extradited to the United States from Hungary in July 2018.
4. In connection with this case on July 26, 2018, Arvinsingh Canaye, formerly the General Manager of Beaufort Management Services Ltd (“Beaufort Management”), an off-shore management company located in Mauritius pleaded guilty to conspiracy to commit money laundering.
The case
5. According to court documents, in June 2017, an undercover agent met with Baron and explained that he was a U.S. citizen involved in stock manipulation schemes and was interested in opening multiple corporate bank accounts at Loyal Bank.
6. The undercover agent informed Baron that he did not want to appear on any of the account opening documents for his bank accounts at Loyal Bank, even though he would be the true owner of the accounts.
7. Baron responded that Loyal Bank could open such accounts and provide debit cards linked to them.
8. In July 2017, the undercover agent again met with Baron and described how his stock manipulation scheme operated, including the need to circumvent the IRS’s reporting requirements under FATCA.
9. During the meeting, Baron stated that Loyal Bank would not submit a FATCA declaration to regulators unless the paperwork indicated “obvious” U.S. involvement.
10. Subsequently, in July and August 2017, Loyal Bank opened multiple bank accounts for the undercover agent.
11. At no time did Baron or Loyal Bank request or collect FATCA Information from the undercover agent.
Observations
12. Baron’s guilty plea represents the first-ever conviction for failing to comply with FATCA. When sentenced, Baron faces a maximum of five years in prison.
13. Baron is the second defendant to plead guilty in this case.
14. In connection with this case on July 26, 2018, Arvinsingh Canaye, formerly the General Manager of Beaufort Management Services Ltd (“Beaufort Management”), an off-shore management company located in Mauritius pleaded guilty to conspiracy to commit money laundering. – see additional reading below
Read more
ADDITIONAL READING
a Mauritian TCSB General Manager (Arvinsingh Canaye), pleads guilty to single count of money laundering conspiracy
1. On the 6th august 2018 it was reported that a court case in the USA relating to collapsed broker Beaufort Securities has seen one of the defendants plead guilty to a money laundering conspiracy.
2. Arvinsingh ‘Vinesh’ Canaye, a Mauritian citizen and general manager of Beaufort Management, an offshore company (Mauritius) connected with Beaufort Securities, has pleaded guilty according to The Times.
3. Canaye was one of six defendants named in a US indictment issued in March (see below) that came on the same day as the Financial Conduct Authority ordered Beaufort to cease all regulatory activity as the company was declared insolvent.
4. Beaufort Securities has been in the spotlight since December 2016 when the FCA restricted its discretionary powers.
5. The paper also reported that a second defendant, Adrian Baron, chief business officer of Loyal Bank, has been extradited from Hungary.
6. Baron, 63, a British citizen, has been accused of a money-laundering conspiracy involving Beaufort and Loyal Bank, an offshore bank with offices located in St Vincent and the Grenadines and Budapest.
7. He has also been accused of conspiracy to defraud the US. He has pleaded not guilty to all counts, according to court documents.
8. In March US attorney Richard Donoghue said:
a. ‘As alleged in the indictment, the defendants engaged in an elaborate multi-year scheme to defraud the investing public of millions of dollars through deceit and manipulative stock trading, and then worked to launder the fraudulent proceeds through off-shore bank accounts and the art world, including the proposed purchase of a Picasso painting.’
9. Beaufort Securities should not be confused with Beaufort Group, a national advice business and a completely separate company.
Read more –
- http://citywire.co.uk/new-model-adviser/news/defendant-in-beaufort-securities-court-case-pleads-guilty/a1144339
- http://citywire.co.uk/new-model-adviser/news/fca-declares-troubled-dfm-beaufort-securities-insolvent/a1097424?section=new-model-adviser&linkSource=article-body
Six Individuals And Four Corporate Defendants Indicted In $50 Million International Securities Fraud And Money Laundering Schemes – Defendants Proposed that Undercover Law Enforcement Agent Purchase a Pablo Picasso Painting to Launder Fraudulent Profits From Stock Manipulation Scheme
On Friday, March 2, 2018 a multi-count indictment was published – the indictment was against
- ADRIAN BARON and Beaufort Management Services Ltd (“Beaufort Management”), an off-shore management company located in Mauritius;
- Panayiotis Kyriacou, Arvinsingh Canaye Linda Bullock, Matthew Green, and Aristos Aristodemou; Beaufort Securities Ltd (“Beaufort Securities”), a brokerage firm located in London, United Kingdom;
- Loyal Bank Ltd (“Loyal Bank”), an off-shore bank with offices in Budapest, Hungary and Saint Vincent and the Grenadines; and Loyal Agency and Trust Corp. (“Loyal Agency”), an off-shore management company located in Saint Vincent and the Grenadines.
The charges include conspiracy to commit securities fraud and money laundering conspiracy.
1. “As alleged in the indictment, the defendants engaged in an elaborate multi-year scheme to defraud the investing public of millions of dollars through deceit and manipulative stock trading, and then worked to launder the fraudulent proceeds through off-shore bank accounts and the art world, including the proposed purchase of a Picasso painting,” stated United States Attorney Donoghue.
2. “The charges announced today reflect that this Office, together with our law enforcement partners, is committed to holding accountable those who defraud investors, regardless of the complex schemes they use to hide their ill-gotten gains.”
3. “As alleged, in a series of unscrupulous and illegal trading practices, the defendants contrived a scheme to defraud investors of U.S. publicly traded companies by manipulating stock prices and masking the true ownership of their clients’ financial interests,” stated Assistant Director-in-Charge Sweeney. “In order to discreetly receive their illegal proceeds, the defendants focused their efforts on laundering the money through a variety of means, including the art world, which they believed was a market free from direct regulation. Bringing to justice securities fraudsters and money laundering facilitators who engage in these types of schemes is and will remain a priority for the FBI and our law enforcement partners worldwide.”
4. “Since the Foreign Account Tax Compliance Act has been enacted, the financial expertise of our criminal investigators is needed now more than ever in this global economy,” stated IRS-CI Special Agent-in-Charge Robnett. “These allegations outline an intricate scheme to obscure beneficial ownership and launder illicit proceeds. This behaviour harms the financial world abroad and here at home.”
Securities Fraud and Money Laundering Scheme
1. As alleged in the indictment, between March 2014 and February 2018, Beaufort Securities, Beaufort Management, and managers Kyriacou and Canaye, collectively the “Beaufort Defendants,” together with their co-conspirators, engaged in a scheme to defraud investors and potential investors in various U.S. publicly traded companies by concealing the true ownership of various U.S. publicly traded companies and manipulating the price and trading volume in the stocks of those companies.
2. Beginning in or about October 2016, an Undercover Agent contacted Kyriacou and stated that he was interested in opening brokerage accounts at Beaufort Securities from which he could execute trades in several multi-million dollar stock manipulation deals.
3. In furtherance of the scheme, the Beaufort Defendants opened brokerage accounts for their clients in the names of off-shore shell companies with nominee shareholders and directors, and then conducted manipulative trading of stocks of U.S. publicly traded companies listed on U.S. over-the-counter exchanges. Beaufort Securities facilitated at least ten “pump and dump” schemes involving U.S. publicly traded stocks, generating over $50 million in proceeds for its clients. Notably, Beaufort Securities had affirmed to the Financial Conduct Authority (“FCA”) in the United Kingdom in July 2016 that it had taken remedial measures to correct deficiencies in the firm’s financial crime controls and anti-money laundering processes.
4. Additionally, between January 2011 and February 2018, the Beaufort Defendants; Loyal Bank; Loyal Agency; Baron, the Chief Business Officer of Loyal Bank and a Director of Loyal Agency; and Bullock, the Chief Executive Officer of Loyal Bank and a Director of Loyal Agency, together with their co-conspirators, devised and engaged in a scheme to launder securities fraud proceeds for their clients.
5. To facilitate this scheme, Beaufort Securities transferred funds to corporate bank accounts at Loyal Bank opened in the names of off-shore shell companies that were controlled by the bank’s clients.
6. Loyal Bank then provided debit cards to its clients to withdraw funds from those accounts in an untraceable manner to hide the source of the money and facilitate ongoing securities fraud.
Money Laundering Through Purchase and Sale of Art
1. Separately, between October 2017 and February 2018, Kyriacou; Aristodemou, the uncle of Kyriacou; and Green, the owner of an art gallery in London, United Kingdom, together with their co-conspirators, agreed to launder £6.7 million, the equivalent of over $9 million dollars, which the Undercover Agent represented to be the proceeds of securities fraud.
2. After initially proposing the use of real estate investments to launder the funds, the co-conspirators devised a scheme to “clean up the money” through the purchase and subsequent sale of art.
3. Aristodemou described the art business as the “only market that is unregulated,” and that art was a profitable investment because of “money laundering.”
4. The defendants proposed the Undercover Agent could purchase from Green a painting by Pablo Picasso entitled “Personnages, Painted 11 April 1965,” and provided paperwork for the painting’s purchase.
5. The money laundering scheme was halted prior to the transfer of ownership of the painting.
The Defendants:
1. PANAYIOTIS KYRIACOU, also known as “Peter Kyriacou”
Age: 26
Residence: London, England
2. ARVINSIGH CANAYE, also known as “Vinesh Canaye”
Age: 30
Residence: Mauritius
3. ADRIAN BARON
Age: 63
Residence: Budapest, Hungary
4. LINDA BULLOCK
Age: 57
Residence: St. Vincent/Grenadines
5. ARISTOS ARISTODEMOU
Age: 49
Residence: London, England
6. MATTHEW GREEN
Age: 50
Residence: London, England
7. BEAUFORT SECURITIES LTD
London, England
8. BEAUFORT MANAGEMENT SERVICES LTD
Mauritius
9. LOYAL BANK LTD
Budapest, Hungary and St. Vincent/Grenadines
10. LOYAL AGENCY AND TRUST CORP.
St. Vincent/Grenadines
Loading...