Saturday, June 05, 2004 9:59:06 AM
Palm & Dallas. I wonder how closely TPK actually was involved with the 10 years ago? TPK certainly comes across like a poor-man's Robert Palm.
Here is TPK talking about them in his SEC deposition (tks to DD who posted it on RB):
Q. What kind of Foreign interest do you have in Canada?
A. I did have an interest in a company called Advanced Capital Services.
Q. Is that the same Advanced Capital Services you mentioned earlier?
A. No.
Q. What's the difference?
A. That one was incorporated in Canada.
Q. Was that also your personal corporation?
A. No, I had a one-third interest in it. I had two other partners.
Q. And who were they?
A. Robert Palm and Jason Dallas.
...
Q. Are these Canadian citizens?
A. I believe they are.
Q. Are they still in Canada?
A. I have no clue where they are.
Q. Did that company have any assets?
A. Yes.
Q. And what kind of assets?
A. I wouldn't be able to give you an exact figure.
Q. What kind of assets, what type?
A. They reported billions in assets.
Q. Money assets?
A. Stocks, bonds, currencies, real estate, gold, you name it.
Q. And what was the purpose of that company? What was the business?
A. Venture capital.
Q. And the foreign interest in the Cayman Islands, what kind of foreign interest did you have in the Cayman Islands?
A. Does it say Cayman Islands?
Q. Yes, it does.
A. Oh, yeah. Okay.
Q. What kind of foreign interest did you have in the Cayman Islands?
A. You'd have to ask them.
Q. I'm sorry?
A. You'd have to ask Advanced Capital that question.
Q. So the foreign interests you have in Canada --
A. They were through Advanced Capital.
Q. And the Phillipines?
A. Yes.
Q. Also through Advanced Capital?
A. Yes.
Q. Of Canada?
A. Yes.
Q. And Russia?
A. Yes.
Q. That was also through Advanced Capital?
A. Yes.
Q. And Hungary and Europe?
A. Yes.
Q. Were those all through Advanced Capital of Canada?
A. Yes.
Q. What city is this company in?
A. Victoria. I don't know if it's-- I don't think it's still around.
Q. What made you think that Advanced Capital had billions of dollars of assets?
A. They showed me the financial statement.
Q. Who's they?
A. Robert Palm and Jason Dallas.
Q. What did the financial statements say about that? What did they indicate?
A. That they had stocks, they had contracts for gold, they had currency transactions, that sort of thing.
Q. What did you do to become a third partner in this venture?
A. I was giving them advice.
Q. Did you recieve a third of that billions of assets?
A. It became part of my assets, yes.
Q. Did they give you a listing of those assets?
A. Did who?
Q. The company. I mean, did they give you anything that would indicate that you had -- that you personally owned a third of this billions --
A. They showed me the documents, yes.
Q. Do you have any of those documents?
A. No.
Q. Do you have access to any of those funds?
A. No.
Q. Do you know where those funds are held?
A. No.
Q. So the only people that would know this are the two men you mentioned?
A. Yes.
Q. Do you know where they are?
A. No.
Q. Do you know what city they live in?
A. No.
Q. You have no idea?
A. No.
Q. Do you know how old they are?
A. No.
Here's TPK in a message to me: If you happen to have Palm's or Dallas' location, address or phone or anything on them let me know. I've been looking for them for over a decade.
So this is the latest I can find:
Victoria man fined $37M US for fraud case: Plot hurt thousands of Polish farmers
Vancouver Sun
Saturday, January 18, 2003
Page: A4
Section: News
Byline: Gerard Young
Dateline: VICTORIA
Source: Canadian Press
VICTORIA -- A Victoria resident who claimed to be a man of the cloth has been ordered to pay more than $37 million US for ripping off thousands of poor Polish farmers.
Supreme Court Justice Allen Melvin released a written judgment Friday, saying Robert Palm was "one of the most frustrating witnesses one could ever hear."
Hod Impex, which represents the Polish farmers, claimed Palm, his company Advance Capital Services, and his partner Jason Dallas failed to pay for foodstuffs it bought.
The food was to be delivered to Russia as "humanitarian aid" with the Berlin Wall coming down and Eastern Europe in upheaval with the fall of communism in the early 1990s.
"The judgment against Robert Palm is the result of fraud and deceit," Hod Impex lawyer Ryszard Winski said.
He has no idea where Palm is though he is believed to be in Greater Victoria, he said. All legal correspondence or contact went through his lawyer David Ashton.
A message at Ashton's law office said his voice mailbox was full and no message could be left. Palm has 30 days to appeal the judgment.
Winski has doubts whether Palm could pay even a tiny fraction of the judgment as some of his testimony indicated he had no assets in Victoria.
However, some evidence suggested he had some assets in Russia and Uzbekistan though Winski has not investigated whether Palm has money or property invested on foreign soil.
Palm and his schemes have caught the interest for more than a decade of the FBI, other American and European police agencies, Interpol, the RCMP and Revenue Canada.
He was charged with criminal fraud in Poland but wasn't extradited nor do the RCMP feel a case can be made locally though Polish prosecutors want him charged, Winski said.
His partner Jason Dallas, however, was extradited from Switzerland, convicted in Poland on fraud charges and spent 41/2 years in prison.
His whereabouts is not known though it is believed he is back in Victoria. He was not part of the civil judgment because he couldn't be served with the lawsuit as he was in jail but Melvin noted his involvement.
Melvin found Palm personally liable as Advance Capital Services was struck off the registrar of companies more than five years ago.
The Bank of Ukraine and a Ukrainian company were also looking for Palm for racketeering and breach of trust in a $40-million rubles-for-dollars exchange.
In previous interviews with the Times Colonist, Palm described himself as a Pentecostal minister who represented a consortium of Christian philanthropists.
Melvin commented during the civil trial that Palm was engaging in "smoke and mirrors" during his testimony.
"Attempts to get definitive answers to simple questions resulted in convoluted responses," he wrote in his judgment. "Mr. Palm is a dissembler of the greatest magnitude whose evidence in chief was an insult to one's intelligence."
He rejected Palm's assertion that several other companies he was associated with had the means to pay Hod Impex.
Palm listed himself as a director of the Moscow-based United National Republic Bank, which was to be guarantor of payment for the foodstuff, which was wheat flour.
Palm told Melvin he was an ordained pastor who also had worked in logging, mining and with "some significant European trusts." He said he worked with the trust that held most of the Thai Royal Family's assets and also consulted with King Fayad of Arabia.
Palm was the only witness in his defence. He insisted he always thought the various institutions he was involved with would pay off the farmers. Melvin rejected that, questioning the validity of some of the sources of guarantees.
While it has yet to be determined whether they will get any of the judgment, Hod Impex has been vindicated, he said.
"They will feel justice has been done," he said.
And the original story tying Palm to FIBG below. Actually, this one makes Acs sound more like Dallas - would be writer, son of eastern European immigrants, name changes ... Dallas, now 47, is the son of a Polish immigrant. His original name was Earl Bortnick, but around 1980 he assumed a more Hollywood-ish moniker, ostensibly to advance his career as an aspiring writer.
How this international fugitive helped build a phoney bank: Robert Palm from Victoria provided fraudulent assets
Vancouver Sun
Saturday, July 28, 2001
Page: A1 / FRONT
Section: News
Byline: David Baines
Source: Vancouver Sun
It was the summer of 2000 and the congregation of the North Douglas Pentecostal Church in Victoria sat quietly as pastor John Dobroski and Surrey businessman Robert McIvor presented a deal that seemed too good to be true.
By mortgaging three houses that it owned, the church could raise $450,000 and invest the proceeds in a five-year term deposit with Cambridge International Bank & Trust, registered in Grenada.
Interest would accrue at the spectacular rate of 33 per cent per year. That meant that, at the end of the five-year term, the investment would be worth $1.9 million.
High return usually means high risk. But McIvor insisted that, in this case, there was zero risk. That's because all deposits were insured by Lloyd's of London. Or so he claimed.
Among those in the congregation was Robert Earl Palm, 53, who had arranged for McIvor to make his presentation. Both men were well known to the Pentecostal Church. They had been long-time members, and Palm had once served as a Pentecostal minister in Princeton.
Unknown to church members, however, they were also well known to prosecutors in Poland, where they had perpetrated a massive swindle eight years earlier.
Posing as the front man for a group of well-heeled Christian businessmen, Palm had persuaded a Polish agricultural co-op to sell $37.3 million US worth of potatoes, flour and other foodstuffs to Advance Capital Services Corp., a Victoria-registered company run by him and an associate, Jason Dallas.
Palm told the co-op the food would be used to feed the starving masses of Russia. Payment would be made by United National Republic Bank of Russia which, despite its exotic name, also had its mailing address in Victoria. Once again, Palm and Dallas were listed as directors.
To show that UNRB had the financial capacity to guarantee payment, Palm and Dallas proffered financial statements showing that the bank had $189 billion worth of assets. It was an astounding amount given the bank's obscurity: If true, UNRB would rank among the world's 30 largest financial institutions.
The statements were purportedly audited by Victoria accounting firm McIvor & Associates. More particularly, they were audited by Robert McIvor, who was now trying to persuade the North Douglas congregation to invest in an equally obscure bank in Grenada.
The fact that McIvor had certified that the statements accorded with generally-accepted accounting principles meant nothing. That's because he wasn't an accountant, at least not a professional accountant, and therefore wasn't qualified to make such a pronouncement.
As events unfolded, UNRB's guarantee proved worthless. The Polish New Bulletin reported that, after shipping train loads of foodstuffs to Russia, the Polish co-op ``failed to receive even one cent from the transaction [except for] one copy of the Bible and the pastor's blessings.''
Polish prosecutors charged Palm and Dallas with criminal fraud. In 1995, Dallas was arrested in the Swiss resort of Baden and extradited to Poland, where he was convicted and sentenced to five years in jail. Palm retreated to Victoria, where -- because Poland does not have an extradition treaty with Canada -- he has been able to operate with impunity.
In 1997, Palm met another self-professed man of God, Van A. Brink, a former Oregon bankrupt who was establishing a bank in Grenada. It would be called First International Bank of Grenada, and would soon establish a string of sub-banks, including one called Cambridge International Bank & Trust.
The bank was capitalized with a small amount of cash and a ruby said to be worth $20 million US. Then it assembled a grab-bag of assets that were ``assigned'' to the bank. They included certificates for gold bullion that was supposedly being held in a Swiss bank and other paper assets purportedly issued by banks in China and Japan.
The total value of these assets was said to be $13.8 billion US.
The bank claimed these assets could generate enough income to pay depositors and investors up to 250 per cent per year. Using this sales pitch, FIBG was able to raise more than $200 million US from residents of Canada and the United States. The sub-banks raised millions more, including Cambridge, which raised an estimated $40 million from B.C. residents.
But FIBG's asset base was incapable of generating anywhere near the promised rate of return. So early investors were paid, not from internally-generated income, but -- in classic Ponzi-scheme style -- from money provided by later investors.
By September, investigators from the B.C. Financial Institutions Commission had learned about McIvor's pitch to the North Douglas congregation. They issued a cease-and-desist order against Cambridge, which was not licensed to take deposits in B.C., and McIvor. But it was too late to save earlier investors. The house of cards collapsed. FIBG and its sub-banks -- including Cambridge -- became insolvent. Anxiety turned to desperation when investors discovered the deposit insurance was worthless.
Marcus Wide of PricewaterhouseCoopers, who is now acting as FIBG's liquidator, says the paper assets have no value: ``My enquiries suggest that the underlying property is fictitious or fraudulently represented,'' he said in a recent report.
In an interview this week, Wide said it appears many of the assigned assets were provided through an offshore company that appears to be associated with Palm.
``One day, the bank had nothing but a ruby. Then Brink and his associates had a meeting in Victoria, and all these (paper) assets appeared in close order.''
Cambridge's principals are now under investigation by the RCMP, the B.C. Securities Commission and the U.S. Federal Bureau of Investigation. Three of them -- president David Rowe, vice-president Gerry Burns and U.S. lawyer Waylon McMullen -- have already been arrested and charged with fraud and are awaiting trial in the United States.
Palm, meanwhile, is keeping a low-profile in Victoria. Attempts by The Vancouver Sun to locate him were unsuccessful and his long-time lawyer, David Ashton of Victoria, declined to speak on his behalf. ``Mr. Palm has instructed me not to comment on his affairs,'' he said.
- - -
Robert Earl Palm has had a long association with the Pentecostal Church in B.C. He graduated from Western Pentecostal Bible College near Abbotsford in 1976, then served as minister of Princeton Pentecostal Tabernacle until 1979, then ceased being a minister.
Why he left the church is not known, but it is clear he was getting involved in shady business deals.
One of his many victims was former IBM sales agent John Hanson, who moved to Port Coquitlam in the early 1980s and joined a Christian businessmen's group, where he met Palm and a man called Richard Downes. (Years later, Downes would be chairman of First International Bank of Grenada.)
``I was very vulnerable at the time because of marital problems,'' Hanson told The Sun in August, 1993.
``Palm was living in Victoria then, but he came over all the time and, to Downes, he was sort of a god. They had these prayer meetings and the laying on of hands, people falling over, giving testimony and saying they had been saved.''
Hanson said he was talked into investing $40,000 in an alleged arbitrage deal (stock buying and selling in different markets) in Europe. He spent years trying to get his money back, but failed and lost his house in the process.
Others told similar stories of losing money in Palm's many inventive and audacious investment schemes.
In 1986, Palm surfaced on the Vancouver Stock Exchange with an associate, Jason Dallas, who would play a key role in some of his more infamous deals.
Dallas, now 47, is the son of a Polish immigrant. His original name was Earl Bortnick, but around 1980 he assumed a more Hollywood-ish moniker, ostensibly to advance his career as an aspiring writer.
About the same time, he met Palm through the Pentecostal Church in Victoria. They became friends, then business partners. In 1985, they formed Advance Capital Services Corp, whose registered office is Ashton's law office on Fort Street in Victoria.
In October 1986, Advance Capital made a dramatic debut on the VSE. A string of penny-ante VSE-listed companies, led by a company called Greenwell Resources, announced they would issue millions of shares to buy more than $1 billion worth of real estate and other assets from Advance Capital.
There was no clear indication that Advance Capital actually owned the assets, or why it wanted to swap them for VSE stock. As it turned out, the deals were never consummated, but they caused a speculative bubble that provided some insiders with the opportunity to realize trading profits. Two of them, Thomas Irving and Harold Baker of Greenwell, were found guilty of illegal insider trading by the B.C. Securities Commission.
In May, 1992, another VSE company, Metro Industrial Corp. of Victoria, announced plans to sell $60 million worth of shares to Cartesa Finance Corp., a Liechtenstein company headed by Palm, and United National Republic Bank of Russia, whose directors included Palm and Dallas. This time the VSE intervened and blocked the deal.
In a July 1993 interview with The Sun, former stock market investigator Adrian du Plessis said Palm's VSE deals were ``distinguished by the grossness of their exaggerations -- he always went for big decimals.''
He said Palm's deals were so preposterous that at first he didn't spend much time on them. ``But then he stepped on the world stage, where he could cause real harm. He began talking about multi-million dollar deals in China with fake certificates of deposit. I have some of them littering my floor and if they were real they'd be worth billions of dollars.''
- - -
In 1992, Palm and Dallas embarked on their boldest-ever scheme. Cloaked in their Christian personas, they convinced a Polish agricultural cooperative, Hod-Impex Ltd., that a group of unidentified Christian businessman had donated money to buy vast quantities of produce to feed the starving masses in Russia.
From February to May 1992, Advance Capital signed contracts to buy $316 million US worth of potatoes, flour and other food commodities to Russia.
The order was so large that Hod-Impex divided it among smaller trading firms, which scoured the Polish countryside to buy up surplus produce.
They eventually delivered part of the order -- 165,679 metric tonnes of potatoes, wheat, rye flour and other foodstuffs. Hod-Impex sent Advance Capital a bill for $37.3 million US, but received nothing.
In a May 2000 interview with the Globe and Mail, Hod-Impex president Aderzej Pazdzior said that, when he insisted on payment, Palm and Dallas made all sorts of excuses, burying him with guarantees and promissory notes from a string of financial institutions.
At one point, he said, they promised to pay him with 25 tonnes of gold. At another, they provided a $125 million letter of credit issued by Guangxi Trust & Investment Corp. in China, which had been unwittingly drawn into Palm's scheme.
Dallas told The Globe that, if the Polish farmers had waited a little longer, they would have been paid. He said Advance Capital had billions of dollars available from the United National Republic Bank and its affiliate, Uzincambank in Uzbekistan.
``I had direct knowledge of the existence of $1.5 billion under our control in Russia and a guarantee from the Russian parliament to establish our bank,'' Dallas told The Globe.
Financial statements purportedly audited by McIvor showed that, as of November, 1991, the bank had $189 billion in assets. But Polish prosecutors said the assets were fictitious, the banks existed in name only, and their real purpose was to facilitate a fraud.
They issued international warrants for the arrest of both men. In 1995, Dallas was arrested in Switzerland and extradited to Poland, where he was convicted of fraud and sentenced to eight and half years in jail (reduced to five years upon appeal). Because there is no extradition treaty between Poland and Canada, Palm remains safely ensconced in Victoria.
``Palm brought Canadian capitalism to Poland with a cross and Bible,'' said Pazdzior. But he proved a plague to the country, bankrupting traders and farmers, ruining lives, and badly soiling Canada's international business reputation. The Polish News Bulletin described how one victim ``died of a heart attack after his entire property was sold at auction.''
- - -
Some time in 1992, when the Polish venture was being geared up, Palm walked into a branch of the Guangxi Trust & Investment Corp. in Nanning in Southern China. According to a July 1993 article in the Wall Street Journal, he made a startling offer: He would lend the bank $1.1 billion in return for a simple IOU.
For bank president Liu Minshan, the offer was too good to refuse. Even though the bank wasn't supposed to borrow from abroad, the opportunity to lay hands on foreign currency was too good to resist. He issued the note, but the money never arrived.
Months later, Palm proffered the note to the Polish farmers as payment for train loads of agricultural products.
Guangxi Trust was not the only Chinese financial institution to be conned by Palm or his associates. In April, 1992, two American associates, Francisco Hung Moy and Raymond Lee, approached a rural branch of the Agricultural Bank of China on behalf of Palm and persuaded the bank to issue 200 letters of credit totalling $10 billion. In return, the two men offered a $10-billion letter of credit from the United National Republic Bank of Russia.
In June, 1993, the two men were arrested, but by then the letters of credit were in circulation. Scotland Yard recovered 22, with a supposed value of $1 billion, but the remaining $9 billion worth of notes were apparently still floating through the world's financial system, prompting Chinese authorities to issue an international warning to bankers against honouring them.
In May, 1994, after a trial in Beijing, Moy was sentenced to 20 years in jail and Lee to 14 years.
In another scheme, Palm persuaded a Ukrainian trust company, Batkivschina, to swap 7.2 billion rubles with his Liechtenstein company, Cartesa Finance Corp., for $31.1 million.
The trust company delivered the rubles, but didn't get the dollars. Pressed for payment, Palm offered $35 million worth of stock in Cartesa, but by that time Cartesa was already in liquidation.
- - -
In early 1999, Offshore Business News and Research, a Florida-based firm, exposed FIBG as a fraud.
Brink moved to Uganda, where he allegedly diverted millions of dollars of depositors' money to finance a luxurious lifestyle and ingratiate himself with local authorities.
He purchased a $5-million property in Kampala from a Swedish businessman and a 13-hectare estate once owned and occupied by former Ugandan leader Idi Amin.
In January this year, Brink, 50, married a Ugandan woman about half his age, apparently to stave off any extradition proceedings. He held a lavish reception at the Sheraton Kampala Hotel. Among the 200 guests was Bonny Katatumba, chairman of the National Ugandan Chamber of Commerce.
In June, 2000, Brink was replaced as chairman of the bank by Richard Downes, the Surrey businessman who had been part of Palm's religious and business circle in the 1980s.
On July 4, 2000, Downes wrote a 10-page letter to FIBG customers, apologizing for failing to redeem their deposits, but urging them to reverse the flow of ``negative energy.''
He said Brink had ``a vision of a banking institution that would do everything it could to be a blessing to its clients, that would treat each of them as if they were a best friend, that would reach out and try to bless those who seemingly had no friends at all.''
He said Brink had a ``pronounced tendency'' to help people, usually by making financial advances at little or no interest:
``He never made one collection call on anyone to the best of our knowledge, nor did he have others make collection calls for him. He felt such was in full keeping with the vision he had been given and the mission to which he felt he was called.''
Then, in a unilateral display of generosity, he declared: ``The bank hereby forgives all such loans made through the various holding companies and trusts it controls. If those who were loaned the money wish to repay it, we leave it up to them.''
- - -
Marcus Wide, appointed FIBG's liquidator earlier his year, doesn't feel quite as benevolent. He views the entire enterprise as a ``sham, scam and fraud.''
In his first report to the Grenadian court, he noted the bank was initially capitalized with a 10,000-carat ruby said to be worth $20 million. The ruby had purportedly been assigned to the bank, but Wide said ``FBI inquiries have determined that the owner of the gem had owned it for more than 20 years, still owned it, had never given up ownership or any interest in the gem, and had never heard of Brink or FIBG.''
Wide said he has documentation showing that Brink travelled to Victoria, after which additional assets were assigned to FIBG and the bank's asset base suddenly ballooned to $13.8 billion US. Those assets included:
- $3.8 billion worth of cheques drawn on Dai-Ichi Kangyo Bank in Japan and made payable to a Japanese businessman, who had purportedly assigned them to Sherwood Investments of the Bahamas. Sherwood, in turn, assigned them to FIBG.
- $500 million worth of letters of guarantee provided by the Bank of China, Hainan Island Branch.
- $8.7 billion worth of gold bullion that was purportedly being held in the Union Bank of Switzerland.
There were several indications that these so called assets came, directly or indirectly, from Palm.
One indication, Wide said, was that documents evidencing these assets were certified as true copies by Ashton's firm. Another indication was that FIBG transferred $2 million US to an trust account at Ashton's firm. Wide said he has tried to talk to Ashton about this matter, but the lawyer had not responded: ``I am now the bank and I want him to account for my money.''
He said he also tried to talk to Sherwood's representative, Alberta resident Dan Bobocel, but Bobocel failed to return his calls. Bobocel and his wife, Edwina, are known Palm associates.
The Sun also learned that a Nanaimo businessman named George Pearce had made a connection between FIBG, Palm and the Dai-Ichi Kangyo Bank.
Pearce said in an interview that Downes and an associate, Chad Parry, tried to buy his boat, the Casa Bella, on behalf of FIBG. As evidence of FIBG's financial capacity to complete the deal, they gave him a certificate of deposit drawn for $2 billion on the Dai-ichi Kangyo Bank.
When he called the phone number on the document, he said, he ended up talking to a person who identified himself as Robert Palm. He said he then called the bank and determined the certificate was a fraudulent document.
Pearce later sold the boat to a Belize-registered corporation, which, in turn, sold it to a B.C. company called Navigator Charter Leasing Ltd. Both companies were closely associated with Rowe and other Cambridge-related people.
Navigator packaged the boat as an investment offering and raised $4 million from public investors. In short order, the business collapsed and Pearce repossessed the boat. Investors are not expected to recover a cent.
A B.C. businessman -- who asked not to be named -- said Rowe introduced him to Palm about three years ago as a person who ``had delivered a great deal of assets to the Grenadian bank.''
Asked the nature of these assets, the businessman replied: ``Well, it was pretty vague. They were quite exotic, gem stones, gold bullion, things like that.''
He said Palm also provided him with copies of certificates of deposit issued by the Bank of China, which he forwarded to his lawyer for closer inspection.
``My lawyer said that, based on the quality of documents provided, he would doubt that Mr. Palm's group had ever completed a genuine transaction.''
- - -
In February, The Sun sent an e-mail to Brink in Uganda, asking what role Palm played in the bank.
``I have met him,'' Brink replied. ``I was introduced to him and to several others on a visit to the Vancouver area. One of his associates indicated that he was interested in acquiring a stock interest, a majority stock interest, in the bank. We were never interested in divesting any shares or other control of the bank. He did not push that topic of conversation with me at all.''
Brink allowed that Palm ``has his detractors'' and ``tends to dominate a discussion,'' but he said he felt he ``learned several useful things by meeting him.''
Asked again what role, if any, Palm played in the bank, Brink replied in legalistic terms, saying Palm was neither an officer, director, shareholder or agent.
``He had no involvement of any kind whatsoever in any of the decision-making processes of the bank and, thus, did not have a role `in the bank,' as was your repeated question.''
Asked whether Palm had provided any of the paper assets that were used to capitalize the bank, he ducked: ``I can tell you that First Bank booked no assets that were not verified to the complete satisfaction of both First Bank's corporate counsel and IDIC's independent legal counsel.''
IDIC is the Insurance Deposit Insurance Corp, a Nevis-registered company that purportedly insured FIBG deposits. The company supposedly operated at arm's-length to the bank, but the head of the insurance company, Doug Ferguson, was very close to Brink. Ferguson even attended Brink's wedding in Uganda.
When the bank ultimately failed, depositors filed claims with IDIC, but failed to recover any money. Said Wide: ``I am left with the opinion that the IDIC insurance program was created to provide inducement and comfort to prospective depositors, but was and remains a sham.''
- - -
In April, 1993, the Polish agricultural co-op, Hod-Impex, filed a $37.3 million US lawsuit in B.C. Supreme Court against Palm, Dallas and their company, Advance Capital Services. (McIvor is not named as defendant, but is cited as an alleged co-conspirator.)
Since then, Palm and his lawyer, David Ashton, have managed to thwart attempts by Hod-Impex's lawyer, Ryszard Winski of Victoria, to bring the matter to trial.
Most recently, the trial was set to go on May 28, but was adjourned to allow Palm and his lawyer to peruse the transcript and documents relating to the criminal trial of Jason Dallas in Poland.
Dobroski, the pastor of the North Douglas Pentecostal Church, confirmed that Palm is a member of his church, but refused to say what role Palm had in introducing Cambridge and McIvor to his congregation.
The church ultimately decided not to invest in Cambridge, thereby escaping financial calamity, and Dobroski straight-armed suggestions that Palm's scheme had caused serious harm to others: ``I don't think it has been proven that he is a crook,'' he said.
Asked whether he has read any of the numerous newspaper articles about Palm's schemes, he replied: ``I don't necessarily agree with things that are stated in the papers.''
dbaines@pacpress.southam.ca
Here is TPK talking about them in his SEC deposition (tks to DD who posted it on RB):
Q. What kind of Foreign interest do you have in Canada?
A. I did have an interest in a company called Advanced Capital Services.
Q. Is that the same Advanced Capital Services you mentioned earlier?
A. No.
Q. What's the difference?
A. That one was incorporated in Canada.
Q. Was that also your personal corporation?
A. No, I had a one-third interest in it. I had two other partners.
Q. And who were they?
A. Robert Palm and Jason Dallas.
...
Q. Are these Canadian citizens?
A. I believe they are.
Q. Are they still in Canada?
A. I have no clue where they are.
Q. Did that company have any assets?
A. Yes.
Q. And what kind of assets?
A. I wouldn't be able to give you an exact figure.
Q. What kind of assets, what type?
A. They reported billions in assets.
Q. Money assets?
A. Stocks, bonds, currencies, real estate, gold, you name it.
Q. And what was the purpose of that company? What was the business?
A. Venture capital.
Q. And the foreign interest in the Cayman Islands, what kind of foreign interest did you have in the Cayman Islands?
A. Does it say Cayman Islands?
Q. Yes, it does.
A. Oh, yeah. Okay.
Q. What kind of foreign interest did you have in the Cayman Islands?
A. You'd have to ask them.
Q. I'm sorry?
A. You'd have to ask Advanced Capital that question.
Q. So the foreign interests you have in Canada --
A. They were through Advanced Capital.
Q. And the Phillipines?
A. Yes.
Q. Also through Advanced Capital?
A. Yes.
Q. Of Canada?
A. Yes.
Q. And Russia?
A. Yes.
Q. That was also through Advanced Capital?
A. Yes.
Q. And Hungary and Europe?
A. Yes.
Q. Were those all through Advanced Capital of Canada?
A. Yes.
Q. What city is this company in?
A. Victoria. I don't know if it's-- I don't think it's still around.
Q. What made you think that Advanced Capital had billions of dollars of assets?
A. They showed me the financial statement.
Q. Who's they?
A. Robert Palm and Jason Dallas.
Q. What did the financial statements say about that? What did they indicate?
A. That they had stocks, they had contracts for gold, they had currency transactions, that sort of thing.
Q. What did you do to become a third partner in this venture?
A. I was giving them advice.
Q. Did you recieve a third of that billions of assets?
A. It became part of my assets, yes.
Q. Did they give you a listing of those assets?
A. Did who?
Q. The company. I mean, did they give you anything that would indicate that you had -- that you personally owned a third of this billions --
A. They showed me the documents, yes.
Q. Do you have any of those documents?
A. No.
Q. Do you have access to any of those funds?
A. No.
Q. Do you know where those funds are held?
A. No.
Q. So the only people that would know this are the two men you mentioned?
A. Yes.
Q. Do you know where they are?
A. No.
Q. Do you know what city they live in?
A. No.
Q. You have no idea?
A. No.
Q. Do you know how old they are?
A. No.
Here's TPK in a message to me: If you happen to have Palm's or Dallas' location, address or phone or anything on them let me know. I've been looking for them for over a decade.
So this is the latest I can find:
Victoria man fined $37M US for fraud case: Plot hurt thousands of Polish farmers
Vancouver Sun
Saturday, January 18, 2003
Page: A4
Section: News
Byline: Gerard Young
Dateline: VICTORIA
Source: Canadian Press
VICTORIA -- A Victoria resident who claimed to be a man of the cloth has been ordered to pay more than $37 million US for ripping off thousands of poor Polish farmers.
Supreme Court Justice Allen Melvin released a written judgment Friday, saying Robert Palm was "one of the most frustrating witnesses one could ever hear."
Hod Impex, which represents the Polish farmers, claimed Palm, his company Advance Capital Services, and his partner Jason Dallas failed to pay for foodstuffs it bought.
The food was to be delivered to Russia as "humanitarian aid" with the Berlin Wall coming down and Eastern Europe in upheaval with the fall of communism in the early 1990s.
"The judgment against Robert Palm is the result of fraud and deceit," Hod Impex lawyer Ryszard Winski said.
He has no idea where Palm is though he is believed to be in Greater Victoria, he said. All legal correspondence or contact went through his lawyer David Ashton.
A message at Ashton's law office said his voice mailbox was full and no message could be left. Palm has 30 days to appeal the judgment.
Winski has doubts whether Palm could pay even a tiny fraction of the judgment as some of his testimony indicated he had no assets in Victoria.
However, some evidence suggested he had some assets in Russia and Uzbekistan though Winski has not investigated whether Palm has money or property invested on foreign soil.
Palm and his schemes have caught the interest for more than a decade of the FBI, other American and European police agencies, Interpol, the RCMP and Revenue Canada.
He was charged with criminal fraud in Poland but wasn't extradited nor do the RCMP feel a case can be made locally though Polish prosecutors want him charged, Winski said.
His partner Jason Dallas, however, was extradited from Switzerland, convicted in Poland on fraud charges and spent 41/2 years in prison.
His whereabouts is not known though it is believed he is back in Victoria. He was not part of the civil judgment because he couldn't be served with the lawsuit as he was in jail but Melvin noted his involvement.
Melvin found Palm personally liable as Advance Capital Services was struck off the registrar of companies more than five years ago.
The Bank of Ukraine and a Ukrainian company were also looking for Palm for racketeering and breach of trust in a $40-million rubles-for-dollars exchange.
In previous interviews with the Times Colonist, Palm described himself as a Pentecostal minister who represented a consortium of Christian philanthropists.
Melvin commented during the civil trial that Palm was engaging in "smoke and mirrors" during his testimony.
"Attempts to get definitive answers to simple questions resulted in convoluted responses," he wrote in his judgment. "Mr. Palm is a dissembler of the greatest magnitude whose evidence in chief was an insult to one's intelligence."
He rejected Palm's assertion that several other companies he was associated with had the means to pay Hod Impex.
Palm listed himself as a director of the Moscow-based United National Republic Bank, which was to be guarantor of payment for the foodstuff, which was wheat flour.
Palm told Melvin he was an ordained pastor who also had worked in logging, mining and with "some significant European trusts." He said he worked with the trust that held most of the Thai Royal Family's assets and also consulted with King Fayad of Arabia.
Palm was the only witness in his defence. He insisted he always thought the various institutions he was involved with would pay off the farmers. Melvin rejected that, questioning the validity of some of the sources of guarantees.
While it has yet to be determined whether they will get any of the judgment, Hod Impex has been vindicated, he said.
"They will feel justice has been done," he said.
And the original story tying Palm to FIBG below. Actually, this one makes Acs sound more like Dallas - would be writer, son of eastern European immigrants, name changes ... Dallas, now 47, is the son of a Polish immigrant. His original name was Earl Bortnick, but around 1980 he assumed a more Hollywood-ish moniker, ostensibly to advance his career as an aspiring writer.
How this international fugitive helped build a phoney bank: Robert Palm from Victoria provided fraudulent assets
Vancouver Sun
Saturday, July 28, 2001
Page: A1 / FRONT
Section: News
Byline: David Baines
Source: Vancouver Sun
It was the summer of 2000 and the congregation of the North Douglas Pentecostal Church in Victoria sat quietly as pastor John Dobroski and Surrey businessman Robert McIvor presented a deal that seemed too good to be true.
By mortgaging three houses that it owned, the church could raise $450,000 and invest the proceeds in a five-year term deposit with Cambridge International Bank & Trust, registered in Grenada.
Interest would accrue at the spectacular rate of 33 per cent per year. That meant that, at the end of the five-year term, the investment would be worth $1.9 million.
High return usually means high risk. But McIvor insisted that, in this case, there was zero risk. That's because all deposits were insured by Lloyd's of London. Or so he claimed.
Among those in the congregation was Robert Earl Palm, 53, who had arranged for McIvor to make his presentation. Both men were well known to the Pentecostal Church. They had been long-time members, and Palm had once served as a Pentecostal minister in Princeton.
Unknown to church members, however, they were also well known to prosecutors in Poland, where they had perpetrated a massive swindle eight years earlier.
Posing as the front man for a group of well-heeled Christian businessmen, Palm had persuaded a Polish agricultural co-op to sell $37.3 million US worth of potatoes, flour and other foodstuffs to Advance Capital Services Corp., a Victoria-registered company run by him and an associate, Jason Dallas.
Palm told the co-op the food would be used to feed the starving masses of Russia. Payment would be made by United National Republic Bank of Russia which, despite its exotic name, also had its mailing address in Victoria. Once again, Palm and Dallas were listed as directors.
To show that UNRB had the financial capacity to guarantee payment, Palm and Dallas proffered financial statements showing that the bank had $189 billion worth of assets. It was an astounding amount given the bank's obscurity: If true, UNRB would rank among the world's 30 largest financial institutions.
The statements were purportedly audited by Victoria accounting firm McIvor & Associates. More particularly, they were audited by Robert McIvor, who was now trying to persuade the North Douglas congregation to invest in an equally obscure bank in Grenada.
The fact that McIvor had certified that the statements accorded with generally-accepted accounting principles meant nothing. That's because he wasn't an accountant, at least not a professional accountant, and therefore wasn't qualified to make such a pronouncement.
As events unfolded, UNRB's guarantee proved worthless. The Polish New Bulletin reported that, after shipping train loads of foodstuffs to Russia, the Polish co-op ``failed to receive even one cent from the transaction [except for] one copy of the Bible and the pastor's blessings.''
Polish prosecutors charged Palm and Dallas with criminal fraud. In 1995, Dallas was arrested in the Swiss resort of Baden and extradited to Poland, where he was convicted and sentenced to five years in jail. Palm retreated to Victoria, where -- because Poland does not have an extradition treaty with Canada -- he has been able to operate with impunity.
In 1997, Palm met another self-professed man of God, Van A. Brink, a former Oregon bankrupt who was establishing a bank in Grenada. It would be called First International Bank of Grenada, and would soon establish a string of sub-banks, including one called Cambridge International Bank & Trust.
The bank was capitalized with a small amount of cash and a ruby said to be worth $20 million US. Then it assembled a grab-bag of assets that were ``assigned'' to the bank. They included certificates for gold bullion that was supposedly being held in a Swiss bank and other paper assets purportedly issued by banks in China and Japan.
The total value of these assets was said to be $13.8 billion US.
The bank claimed these assets could generate enough income to pay depositors and investors up to 250 per cent per year. Using this sales pitch, FIBG was able to raise more than $200 million US from residents of Canada and the United States. The sub-banks raised millions more, including Cambridge, which raised an estimated $40 million from B.C. residents.
But FIBG's asset base was incapable of generating anywhere near the promised rate of return. So early investors were paid, not from internally-generated income, but -- in classic Ponzi-scheme style -- from money provided by later investors.
By September, investigators from the B.C. Financial Institutions Commission had learned about McIvor's pitch to the North Douglas congregation. They issued a cease-and-desist order against Cambridge, which was not licensed to take deposits in B.C., and McIvor. But it was too late to save earlier investors. The house of cards collapsed. FIBG and its sub-banks -- including Cambridge -- became insolvent. Anxiety turned to desperation when investors discovered the deposit insurance was worthless.
Marcus Wide of PricewaterhouseCoopers, who is now acting as FIBG's liquidator, says the paper assets have no value: ``My enquiries suggest that the underlying property is fictitious or fraudulently represented,'' he said in a recent report.
In an interview this week, Wide said it appears many of the assigned assets were provided through an offshore company that appears to be associated with Palm.
``One day, the bank had nothing but a ruby. Then Brink and his associates had a meeting in Victoria, and all these (paper) assets appeared in close order.''
Cambridge's principals are now under investigation by the RCMP, the B.C. Securities Commission and the U.S. Federal Bureau of Investigation. Three of them -- president David Rowe, vice-president Gerry Burns and U.S. lawyer Waylon McMullen -- have already been arrested and charged with fraud and are awaiting trial in the United States.
Palm, meanwhile, is keeping a low-profile in Victoria. Attempts by The Vancouver Sun to locate him were unsuccessful and his long-time lawyer, David Ashton of Victoria, declined to speak on his behalf. ``Mr. Palm has instructed me not to comment on his affairs,'' he said.
- - -
Robert Earl Palm has had a long association with the Pentecostal Church in B.C. He graduated from Western Pentecostal Bible College near Abbotsford in 1976, then served as minister of Princeton Pentecostal Tabernacle until 1979, then ceased being a minister.
Why he left the church is not known, but it is clear he was getting involved in shady business deals.
One of his many victims was former IBM sales agent John Hanson, who moved to Port Coquitlam in the early 1980s and joined a Christian businessmen's group, where he met Palm and a man called Richard Downes. (Years later, Downes would be chairman of First International Bank of Grenada.)
``I was very vulnerable at the time because of marital problems,'' Hanson told The Sun in August, 1993.
``Palm was living in Victoria then, but he came over all the time and, to Downes, he was sort of a god. They had these prayer meetings and the laying on of hands, people falling over, giving testimony and saying they had been saved.''
Hanson said he was talked into investing $40,000 in an alleged arbitrage deal (stock buying and selling in different markets) in Europe. He spent years trying to get his money back, but failed and lost his house in the process.
Others told similar stories of losing money in Palm's many inventive and audacious investment schemes.
In 1986, Palm surfaced on the Vancouver Stock Exchange with an associate, Jason Dallas, who would play a key role in some of his more infamous deals.
Dallas, now 47, is the son of a Polish immigrant. His original name was Earl Bortnick, but around 1980 he assumed a more Hollywood-ish moniker, ostensibly to advance his career as an aspiring writer.
About the same time, he met Palm through the Pentecostal Church in Victoria. They became friends, then business partners. In 1985, they formed Advance Capital Services Corp, whose registered office is Ashton's law office on Fort Street in Victoria.
In October 1986, Advance Capital made a dramatic debut on the VSE. A string of penny-ante VSE-listed companies, led by a company called Greenwell Resources, announced they would issue millions of shares to buy more than $1 billion worth of real estate and other assets from Advance Capital.
There was no clear indication that Advance Capital actually owned the assets, or why it wanted to swap them for VSE stock. As it turned out, the deals were never consummated, but they caused a speculative bubble that provided some insiders with the opportunity to realize trading profits. Two of them, Thomas Irving and Harold Baker of Greenwell, were found guilty of illegal insider trading by the B.C. Securities Commission.
In May, 1992, another VSE company, Metro Industrial Corp. of Victoria, announced plans to sell $60 million worth of shares to Cartesa Finance Corp., a Liechtenstein company headed by Palm, and United National Republic Bank of Russia, whose directors included Palm and Dallas. This time the VSE intervened and blocked the deal.
In a July 1993 interview with The Sun, former stock market investigator Adrian du Plessis said Palm's VSE deals were ``distinguished by the grossness of their exaggerations -- he always went for big decimals.''
He said Palm's deals were so preposterous that at first he didn't spend much time on them. ``But then he stepped on the world stage, where he could cause real harm. He began talking about multi-million dollar deals in China with fake certificates of deposit. I have some of them littering my floor and if they were real they'd be worth billions of dollars.''
- - -
In 1992, Palm and Dallas embarked on their boldest-ever scheme. Cloaked in their Christian personas, they convinced a Polish agricultural cooperative, Hod-Impex Ltd., that a group of unidentified Christian businessman had donated money to buy vast quantities of produce to feed the starving masses in Russia.
From February to May 1992, Advance Capital signed contracts to buy $316 million US worth of potatoes, flour and other food commodities to Russia.
The order was so large that Hod-Impex divided it among smaller trading firms, which scoured the Polish countryside to buy up surplus produce.
They eventually delivered part of the order -- 165,679 metric tonnes of potatoes, wheat, rye flour and other foodstuffs. Hod-Impex sent Advance Capital a bill for $37.3 million US, but received nothing.
In a May 2000 interview with the Globe and Mail, Hod-Impex president Aderzej Pazdzior said that, when he insisted on payment, Palm and Dallas made all sorts of excuses, burying him with guarantees and promissory notes from a string of financial institutions.
At one point, he said, they promised to pay him with 25 tonnes of gold. At another, they provided a $125 million letter of credit issued by Guangxi Trust & Investment Corp. in China, which had been unwittingly drawn into Palm's scheme.
Dallas told The Globe that, if the Polish farmers had waited a little longer, they would have been paid. He said Advance Capital had billions of dollars available from the United National Republic Bank and its affiliate, Uzincambank in Uzbekistan.
``I had direct knowledge of the existence of $1.5 billion under our control in Russia and a guarantee from the Russian parliament to establish our bank,'' Dallas told The Globe.
Financial statements purportedly audited by McIvor showed that, as of November, 1991, the bank had $189 billion in assets. But Polish prosecutors said the assets were fictitious, the banks existed in name only, and their real purpose was to facilitate a fraud.
They issued international warrants for the arrest of both men. In 1995, Dallas was arrested in Switzerland and extradited to Poland, where he was convicted of fraud and sentenced to eight and half years in jail (reduced to five years upon appeal). Because there is no extradition treaty between Poland and Canada, Palm remains safely ensconced in Victoria.
``Palm brought Canadian capitalism to Poland with a cross and Bible,'' said Pazdzior. But he proved a plague to the country, bankrupting traders and farmers, ruining lives, and badly soiling Canada's international business reputation. The Polish News Bulletin described how one victim ``died of a heart attack after his entire property was sold at auction.''
- - -
Some time in 1992, when the Polish venture was being geared up, Palm walked into a branch of the Guangxi Trust & Investment Corp. in Nanning in Southern China. According to a July 1993 article in the Wall Street Journal, he made a startling offer: He would lend the bank $1.1 billion in return for a simple IOU.
For bank president Liu Minshan, the offer was too good to refuse. Even though the bank wasn't supposed to borrow from abroad, the opportunity to lay hands on foreign currency was too good to resist. He issued the note, but the money never arrived.
Months later, Palm proffered the note to the Polish farmers as payment for train loads of agricultural products.
Guangxi Trust was not the only Chinese financial institution to be conned by Palm or his associates. In April, 1992, two American associates, Francisco Hung Moy and Raymond Lee, approached a rural branch of the Agricultural Bank of China on behalf of Palm and persuaded the bank to issue 200 letters of credit totalling $10 billion. In return, the two men offered a $10-billion letter of credit from the United National Republic Bank of Russia.
In June, 1993, the two men were arrested, but by then the letters of credit were in circulation. Scotland Yard recovered 22, with a supposed value of $1 billion, but the remaining $9 billion worth of notes were apparently still floating through the world's financial system, prompting Chinese authorities to issue an international warning to bankers against honouring them.
In May, 1994, after a trial in Beijing, Moy was sentenced to 20 years in jail and Lee to 14 years.
In another scheme, Palm persuaded a Ukrainian trust company, Batkivschina, to swap 7.2 billion rubles with his Liechtenstein company, Cartesa Finance Corp., for $31.1 million.
The trust company delivered the rubles, but didn't get the dollars. Pressed for payment, Palm offered $35 million worth of stock in Cartesa, but by that time Cartesa was already in liquidation.
- - -
In early 1999, Offshore Business News and Research, a Florida-based firm, exposed FIBG as a fraud.
Brink moved to Uganda, where he allegedly diverted millions of dollars of depositors' money to finance a luxurious lifestyle and ingratiate himself with local authorities.
He purchased a $5-million property in Kampala from a Swedish businessman and a 13-hectare estate once owned and occupied by former Ugandan leader Idi Amin.
In January this year, Brink, 50, married a Ugandan woman about half his age, apparently to stave off any extradition proceedings. He held a lavish reception at the Sheraton Kampala Hotel. Among the 200 guests was Bonny Katatumba, chairman of the National Ugandan Chamber of Commerce.
In June, 2000, Brink was replaced as chairman of the bank by Richard Downes, the Surrey businessman who had been part of Palm's religious and business circle in the 1980s.
On July 4, 2000, Downes wrote a 10-page letter to FIBG customers, apologizing for failing to redeem their deposits, but urging them to reverse the flow of ``negative energy.''
He said Brink had ``a vision of a banking institution that would do everything it could to be a blessing to its clients, that would treat each of them as if they were a best friend, that would reach out and try to bless those who seemingly had no friends at all.''
He said Brink had a ``pronounced tendency'' to help people, usually by making financial advances at little or no interest:
``He never made one collection call on anyone to the best of our knowledge, nor did he have others make collection calls for him. He felt such was in full keeping with the vision he had been given and the mission to which he felt he was called.''
Then, in a unilateral display of generosity, he declared: ``The bank hereby forgives all such loans made through the various holding companies and trusts it controls. If those who were loaned the money wish to repay it, we leave it up to them.''
- - -
Marcus Wide, appointed FIBG's liquidator earlier his year, doesn't feel quite as benevolent. He views the entire enterprise as a ``sham, scam and fraud.''
In his first report to the Grenadian court, he noted the bank was initially capitalized with a 10,000-carat ruby said to be worth $20 million. The ruby had purportedly been assigned to the bank, but Wide said ``FBI inquiries have determined that the owner of the gem had owned it for more than 20 years, still owned it, had never given up ownership or any interest in the gem, and had never heard of Brink or FIBG.''
Wide said he has documentation showing that Brink travelled to Victoria, after which additional assets were assigned to FIBG and the bank's asset base suddenly ballooned to $13.8 billion US. Those assets included:
- $3.8 billion worth of cheques drawn on Dai-Ichi Kangyo Bank in Japan and made payable to a Japanese businessman, who had purportedly assigned them to Sherwood Investments of the Bahamas. Sherwood, in turn, assigned them to FIBG.
- $500 million worth of letters of guarantee provided by the Bank of China, Hainan Island Branch.
- $8.7 billion worth of gold bullion that was purportedly being held in the Union Bank of Switzerland.
There were several indications that these so called assets came, directly or indirectly, from Palm.
One indication, Wide said, was that documents evidencing these assets were certified as true copies by Ashton's firm. Another indication was that FIBG transferred $2 million US to an trust account at Ashton's firm. Wide said he has tried to talk to Ashton about this matter, but the lawyer had not responded: ``I am now the bank and I want him to account for my money.''
He said he also tried to talk to Sherwood's representative, Alberta resident Dan Bobocel, but Bobocel failed to return his calls. Bobocel and his wife, Edwina, are known Palm associates.
The Sun also learned that a Nanaimo businessman named George Pearce had made a connection between FIBG, Palm and the Dai-Ichi Kangyo Bank.
Pearce said in an interview that Downes and an associate, Chad Parry, tried to buy his boat, the Casa Bella, on behalf of FIBG. As evidence of FIBG's financial capacity to complete the deal, they gave him a certificate of deposit drawn for $2 billion on the Dai-ichi Kangyo Bank.
When he called the phone number on the document, he said, he ended up talking to a person who identified himself as Robert Palm. He said he then called the bank and determined the certificate was a fraudulent document.
Pearce later sold the boat to a Belize-registered corporation, which, in turn, sold it to a B.C. company called Navigator Charter Leasing Ltd. Both companies were closely associated with Rowe and other Cambridge-related people.
Navigator packaged the boat as an investment offering and raised $4 million from public investors. In short order, the business collapsed and Pearce repossessed the boat. Investors are not expected to recover a cent.
A B.C. businessman -- who asked not to be named -- said Rowe introduced him to Palm about three years ago as a person who ``had delivered a great deal of assets to the Grenadian bank.''
Asked the nature of these assets, the businessman replied: ``Well, it was pretty vague. They were quite exotic, gem stones, gold bullion, things like that.''
He said Palm also provided him with copies of certificates of deposit issued by the Bank of China, which he forwarded to his lawyer for closer inspection.
``My lawyer said that, based on the quality of documents provided, he would doubt that Mr. Palm's group had ever completed a genuine transaction.''
- - -
In February, The Sun sent an e-mail to Brink in Uganda, asking what role Palm played in the bank.
``I have met him,'' Brink replied. ``I was introduced to him and to several others on a visit to the Vancouver area. One of his associates indicated that he was interested in acquiring a stock interest, a majority stock interest, in the bank. We were never interested in divesting any shares or other control of the bank. He did not push that topic of conversation with me at all.''
Brink allowed that Palm ``has his detractors'' and ``tends to dominate a discussion,'' but he said he felt he ``learned several useful things by meeting him.''
Asked again what role, if any, Palm played in the bank, Brink replied in legalistic terms, saying Palm was neither an officer, director, shareholder or agent.
``He had no involvement of any kind whatsoever in any of the decision-making processes of the bank and, thus, did not have a role `in the bank,' as was your repeated question.''
Asked whether Palm had provided any of the paper assets that were used to capitalize the bank, he ducked: ``I can tell you that First Bank booked no assets that were not verified to the complete satisfaction of both First Bank's corporate counsel and IDIC's independent legal counsel.''
IDIC is the Insurance Deposit Insurance Corp, a Nevis-registered company that purportedly insured FIBG deposits. The company supposedly operated at arm's-length to the bank, but the head of the insurance company, Doug Ferguson, was very close to Brink. Ferguson even attended Brink's wedding in Uganda.
When the bank ultimately failed, depositors filed claims with IDIC, but failed to recover any money. Said Wide: ``I am left with the opinion that the IDIC insurance program was created to provide inducement and comfort to prospective depositors, but was and remains a sham.''
- - -
In April, 1993, the Polish agricultural co-op, Hod-Impex, filed a $37.3 million US lawsuit in B.C. Supreme Court against Palm, Dallas and their company, Advance Capital Services. (McIvor is not named as defendant, but is cited as an alleged co-conspirator.)
Since then, Palm and his lawyer, David Ashton, have managed to thwart attempts by Hod-Impex's lawyer, Ryszard Winski of Victoria, to bring the matter to trial.
Most recently, the trial was set to go on May 28, but was adjourned to allow Palm and his lawyer to peruse the transcript and documents relating to the criminal trial of Jason Dallas in Poland.
Dobroski, the pastor of the North Douglas Pentecostal Church, confirmed that Palm is a member of his church, but refused to say what role Palm had in introducing Cambridge and McIvor to his congregation.
The church ultimately decided not to invest in Cambridge, thereby escaping financial calamity, and Dobroski straight-armed suggestions that Palm's scheme had caused serious harm to others: ``I don't think it has been proven that he is a crook,'' he said.
Asked whether he has read any of the numerous newspaper articles about Palm's schemes, he replied: ``I don't necessarily agree with things that are stated in the papers.''
dbaines@pacpress.southam.ca
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