Final New York case against Seychelles and the FIU dismissed |13 September 2011
The withdrawal of this frivolous lawsuit with its patently false allegations, brought by Cooperhill Investments Ltd and Kazou BV, represents a significant victory for the government and people of Seychelles in facing down frivolous and malicious complaints lodged in the United States, and widely publicised in the international media, in an effort to intimidate the government and FIU from confronting money-laundering taking place in the Seychelles financial services sector.
Both of the above companies are currently before the Supreme Court in Seychelles under the Proceeds of Crime legislation where the FIU has sought a formal order to freeze the associated bank accounts with a value of over 100 million SCR.
Cooperhill is by far the larger case. In its application to the Court, the FIU has stated that it is working with the FIUs and law enforcement agencies of a number of European jurisdictions in the investigation of a very large and organised fraud. The amount of money defrauded is currently believed by this joint international investigation to be worth billions of Euros, with many EU states affected e.g. Norway and Germany.
The FIU believes that over 100 million Euros of this money may have passed through the jurisdiction of Seychelles in a four-month period in 2010. The progress of the case is being keenly watched in Europe and is seen by many States as yet another confirmation of Seychelles’ commitment and determination to fight transnational crime such as drug-trafficking, money laundering and piracy.
As the economic crises deepen in the US and Western Europe, their governments are becoming increasingly intolerant of jurisdictions which facilitate money-laundering and international fraud through their financial services sectors.
This is not the first time false allegations have been made in the New York Courts against Seychelles. Earlier this year, another frivolous lawsuit, taken by two UK citizens -- Stephen Scholes and Terence Stewart -- was also dismissed when the plaintiffs withdrew their case in the face of a robust legal submission lodged on behalf of the government and the FIU by Hughes, Hubbard and Reed (recognised as one of the best law firms in the United States).
Scholes and Stewart had been investigated in Seychelles for an attempted fraud of Barclays Bank and were already convicted and fined, in lieu of a custodial sentence, before they left and lodged their lawsuit in the US.
In a vigorous defence of the Republic, most ably coordinated by the Attorney General’s Office, accusations of wrong-doing by the appointed officers of the FIU and the Seychelles Police Force during the investigation, and the malicious and personal allegations that FIU personnel receive commissions based on funds forfeited to the Republic of Seychelles, were roundly rejected as malicious, outrageous and utterly false.
The Scholes and Stewart’s case was subsequently dismissed in New York and their conviction has since been strongly upheld by the Seychelles Court of Appeal. The FIU can reveal that since the dismissal in New York, it has received support and is cooperating with a Mutual Assistance Request from another jurisdiction for evidence in its possession in relation to yet another and separate alleged multi-million fraud committed there involving these individuals.
The FIU would like to reiterate its commitment to stand firm in the face of malicious court actions and press releases designed to intimidate it from fulfilling its statutory obligation to detect and investigate criminal conduct and the proceeds of crime. It will continue to do its utmost to protect the people and international reputation of Seychelles from foreign criminals who would abuse the jurisdiction’s financial services sector to launder the proceeds of crime. We are currently considering, in conjunction with our international partners, the sanctions that can be taken in Seychelles and the United States against future frivolous actions lodged and publicised in this manner.
The FIU acknowledges the ongoing support of the US government and Interpol in confronting these frivolous New York lawsuits.