Court papers alleged that Lot 31 in the Sea Horse Shores subdivision was bought by Kevin Lawrence, a man who has been sentenced to 20 years in US prison for masterminding a fraudulent investment scheme that defrauded some $5000 investors out of $90 million.
The lawsuit alleged that the funds raised to purchase the property were wired from US bank accounts controlled by Lawrence and his associates to an account at Scotiabank’s main Nassau branch. It claims the Bahamian account was in the name Graham, Thompson & Co.
The court papers allege “On or about April 6, 2002, Donovan Claflin, at Kevin Lawrence’s direction, wire transferred $174,698.75 from First Mutual Bank account number 007-240262-00 to the Bank of Nova Scotia, main branch Nassau, Bahamas, account number 6077-18, in the Graham, Thompson & Co, Nassa, Bahamas.
“These funds were used to purchase from John and Marguerite Petitelerc, of Toronto, Ontario, Canada, the residential real property located at Lot 31. ‘Sea Horse Shores’ subdivision, northern end of Crooked Island, Bahamas, in the name of Timothy Richards of Bainbridge Island, Washington.”
There is nothing to suggest that Scotiabank or Graham, Thompson & Co have done anything wrong, and neither is named as a defendant in the lawsuit.
The lawsuit said there was “probable cause” to believe the property had been acquired, or caused to be acquired, by Lawrence with the proceeds from “fraudulent and illegal activities” specifically securities fraud, mail fraud and wire fraud.
Lawrence had been the founding and principle officer of Health Maintenance Centre and Znetix, companies formed purportedly to develop and operaet health and fitness clubs.
Aided by a network of sales agents Lawrence and his assocites sold securities to investors promising them an initial public offering (IPO). However, this never happened, and Lawrence diverted much of the funds raised for his use.
The Tribune
BahamasB2B Note:
While the Tribune reports that there is nothing to suggest that Graham Thompson or Scotiabank have done anything wrong, and that neither is named as a defendant, we still have a problem with their role in this matter. Graham Thompson and Scotiabank both allowed this transaction to take place AFTER the financial laws of December 2000 were enacted. Only because of the legal shenanigans being played out in court, to thwart the intent of those laws, are these two companies exempted from responsibility. The fact is, these companies had a moral obligation to “know your customer”. Apparently due diligence was never done on Mr. Lawrence. If it was done it was done poorly.
It is because of “oversights” such as this that BahamasB2B fully supports the Bahamas Compliance Commission’s efforts to inspect law offices (and real estate offices) in the Bahamas. The corruption and financial crime in these two areas are widespread and are destroying the integrity of this nation’s financial services industry.
