CIA - Financial Intelligence Operations - Part 3
by, Offshore Informant [OffshoreInformant@safe-mail.net]
October 1, 2005
Years ago, Paul Hiram Chappell [See, e.g. FED - International Financial Progressions - Part 2] led the Office of Chief Counsel in the U.S. Internal Revenue Service (IRS) for the U.S. Treasury Department.
On September 10, 2005 he claimed to represent at least two (2) businesses and its affairs for a man named Robert Earl Palm, who Chappell claimed to have known for over 15-years.
Fifteen (15) years ago, Robert Earl Palm began being named by major newspapers in several major countries as having committed numerous financial business crimes, amongst other activities, which included:
- Currency trading fraud (Russia);
- Fraudulent use of ‘counterfeit official government letterheads’ (Russia);
- Fraudulent use of ‘counterfeit official government representative signatures’ (Russia);
- Fraudulent use of ‘official government TELEX communication systems’ (Russia); and,
- Bank securities exchange fraud (China).
PRAVDA, a Russian news agency has been in business for several decades, and was identified by the U.S. Central Intelligence Agency (CIA) as the "KGB Information Agency", an adversary to what the CIA uses known as the "U.S. Information Agency".
From 1991 thru 1992, articles (see below URL links) appearing in PRAVDA contained investigative detail surrounding multiple financial business frauds throughout Soviet Union (now known as, CIS) territories by a man it named as “Robertowi Palmowi” (aka) “Roberta Palma” (in China), however in 1993 THE WALL STREET JOUNAL identified the same man, who was actually named "Robert Earl Palm".
The actual PRAVDA investigative news articles - written in Russian using the Cyrillic alphabet, also saw several English-language named individuals and businesses appear, at:
PRAVDA http://www.ua-pravda.com/biograph3.shtml http://www.ua-pravda.com/biograph4.shtml http://fakt.temnik.com.ua/
[NOTE: Following the PRAVDA articles (above) in 1991 and 1992, THE WALL STREET JOURNAL carried the article (below) in 1993, which was retrieved in 1998 from Mississippi State University (USA).]
THE WALL STREET JOURNAL
July 22, 1993
International Huge Frauds Hit China ex-Soviet Bloc
Canada Businessman Cited In Schemes Involving Billions In Bank Credit
by Robert Steiner, staff reporter (The Wall Street Journal)
HONG KONG - A portly foreigner turned up at a bank branch in Nanning southern China last year and made a startling offer. He would lend the bank 11-Billion in return for a simple IOU.
Liu Minshan, President of GUANGXI TRUST & INVESTMENT CORPORATION accepted the offer. In China's breakneck economic acceleration, an opportunity to lay hands on foreign currency was too good to pass up, even if his company wasn't supposed to borrow from abroad. He issued a massive Promissory Note but the loan never arrived and Mr. Liu resigned last month.
HALFWAY AROUND THE WORLD MORE THAN 15,000 POLISH POTATO FARMERS ARE STUCK WITH THE NOTE MR. LIU ISSUED. THEIR AGENTS ACCEPTED IT AS PAYMENT FOR MOST OF THEIR 1991 POTATO CROP ONLY TO FIND OUT THE NOTE WAS WORTHLESS.
BEHIND BOTH DEALS, SAY BUSINESSMEN IN CHINA AND POLAND IS A 45- YEAR OLD CANADIAN BUSINESSMAN AND FORMER SMALL TOWN PREACHER, ROBERT EARL PALM. THEY AND SOME OF THE PEOPLE HE DID BUSINESS WITH SAY MR. PALM IS A REMARKABLE PIONEER IN ONE OF THE HOTTEST TRADES TO TOUCH THE FAST EMERGING MARKETS OF THE FORMER SOVIET BLOC AND CHINA. FRAUD.
IN THE CHAOS OF ECONOMIC REFORMS SWEEPING THE COMMUNIST AND EX-COMMUNIST WORLD, OPPORTUNITY FOR FRAUD ABOUNDS. "WESTERN DEMOCRACY HAS COST ME MY LIVELIHOOD," A POLISH POTATO FARMER COMPLAINED TO A CANADIAN TELEVISION CREW IN FEBRUARY.
OTHERS PUT THE BLAME ON MR PALM WHO IS THE TARGET OF AT LEAST THREE  LAWSUITS IN THE U.S. AND CANADA. MR. PALM'S ACTIVITIES ALSO HAVE COME UNDER THE SCRUTINY OF THE U.S. FEDERAL BUREAU OF INVESTIGATION.
THROUGH HIS LAWYERS AT ASHTON & LYON, A BRITISH COLUMBIA FIRM, MR PALM REFUSED TO COMMENT FOR THIS ARTICLE.
LAST MONTH IN WHAT APPEARS TO BE ONE OF THE LARGEST FRAUDS IN CHINA, SINCE THE COUNTRY LAUNCHED ITS ECONOMIC REFORM PROGRAM IN 1979, THE COUNTRY'S PUBLIC SECURITY BUREAU DISCLOSED THAT IT HAD ARRESTED TWO  AMERICAN'S, FRANCISCO HUNG MOY AND RAYMOND LEE. THEY ARE SUSPECTED OF PERSUADING OFFICIALS OF A RURAL BRANCH OF AGRICULTURAL BANK OF CHINA TO WRITE 10-BILLION IN FRAUDULENT STANDBY LETTERS OF CREDIT [SBLC]. THE COLLATERAL WAS ANOTHER LETTER OF CREDIT [LOC] ISSUED BY UNITED NATIONAL REPUBLIC BANK OF RUSSIA, A BANK THAT OFFICIALS IN MOSCOW SAY, "DOESN'T EXIST IN RUSSIA". [UNRB, COULD BE REGISTERED ANYWHERE ELSE, HOWEVER!]
AGRICULTURAL BANK SAYS THE MEN IDENTIFIED THEMSELVES AS WORKING FOR MR. PALM. BY THE TIME MESSRS HUNG MOY AND LEE WERE ARRESTED, THOUGH THE LETTERS OF CREDIT WERE IN CIRCULATION, SCOTLAND YARD UNCOVERED 22 OF THE CHINESE ISSUED LETTERS WITH A SUPPOSED TOTAL VALUE OF 1-BILLION. SUGGESTING THAT THE REST OF THE 9-BILLION IN WORTHLESS PAPER ARE FLOATING THROUGH THE WORLD'S FINANCIAL SYSTEM, CHINA HAS ISSUED AN INTERNATIONAL WARNING TO BANKERS AGAINST HONORING THE NOTES.
MR. PALM, BALDING WITH A FRINGE OF GRAY HAIR, DOES BUSINESS FROM AN OFFICE IN AN INDUSTRIAL AREA OF THE BRITISH COLUMBIA CAPITAL OF VICTORIA ON CANADA'S PACIFIC COAST. PEOPLE WHO HAVE MET HIM SAY HE SPEAKS INTENSELY ABOUT WHAT HE CALLS THE RELIGIOUS NATURE OF HIS WORK. INDEED HE USED TO BE A PENTECOSTAL MINISTER.
HIS FORMER PARTNERS, IN EASTERN EUROPE, SPEAK SOMEWHAT LESS INSPIRATIONALLY ABOUT THEIR BUSINESS WITH HIM. AMONG THEM IS A UKRAINIAN TRUST COMPANY BATKIVSCHINA, WHICH CLAIMS IN A LAWSUIT FILED IN A U.S. DISTRICT COURT IN CALIFORNIA, THAT MR. PALM AND TWO  OTHER MEN OWE IT $311-MILLION, IN PAYMENT FOR RUSSIAN CURRENCY, THE THREE  MEN BOUGHT.
A COMPANY IN FINLAND IS SUING MR. PALM AND OTHERS IN THE SUPREME COURT OF BRITISH COLUMBIA IN VANCOUVER OVER ANOTHER CURRENCY TRADE.
THE OWNERS OF MOSCOW'S PARKLAGUNA HOTEL CLAIM THAT MR PALM'S COMPANY OWES $130,000 FOR KEEPING AN OFFICE IN THEIR HOTEL BETWEEN AUGUST AND DECEMBER 1992. "ONLY PROMISES WE HAVE," SAYS SVETLANA LEPESHKOVA FRONT OFFICE MANAGER AT THE HOTEL. "PROMISES, PROMISES, PROMISES. THAT IS ALL. WE TRUSTED THEM BECAUSE AT FIRST THEY PAID."
INDEED SOME OF HIS FORMER BUSINESS CONTACTS AND THEIR LAWYERS SAY THAT MR. PALM, IN DEALING WITH EACH OF THEM, PUT UP MONEY OR COLLATERAL TO ESTABLISH TRUST, THEN GOT CAPITAL ADVANCES FROM THEM. APPROPRIATELY, MR PALM'S VICTORIA [British Columbia, Canada] BASED COMPANY IS NAMED, ADVANCE CAPITAL SERVICES CORP.
A 1992 PROFILE BY DUN & BRADSTREET CORP. - BASED IN PART ON INFORMATION FROM ADVANCE CAPITAL SERVICES - DESCRIBES THE COMPANY'S PRINCIPAL BUSINESS TERRITORY AS INTERNATIONAL, ADDING THAT IT HAS 200 EMPLOYEES 20 BRANCHES AND 25 SUBSIDIARIES. HALF THE COMPANY'S ANNUAL REVENUE OF 18-MILLION, IS LISTED AS COMING FROM FOOD WHOLESALING AND 40 [-MILLION] FROM LUMBER BROKERING AND METAL MINING AND EXPLORATION. MR PALM HAS BEEN WITH THE COMPANY - OF WHICH HE OWNS 25 - SINCE IT INCORPORATED IN 1985, SAYS DUN & BRADSTREET, AND IS ITS ONLY DIRECTOR.
MR. PALM FIRST CHECKED INTO MOSCOW'S PARKLAGUNA HOTEL IN AUGUST 1991. AS RUSSIA WAS REELING FROM THE COLLAPSE OF MIKHAIL GORBACHEV'S GOVERNMENT, THE SUDDEN END TO CENTRAL PLANNING LEFT RUSSIAN CONSUMERS SCRAMBLING FOR FOOD AND NEW RUSSIAN BUSINESSES SCRAMBLING FOR HARD CURRENCY. UNDER SUCH CIRCUMSTANCES, A SEEMINGLY WEALTHY WELL-CONNECTED WESTERN BUSINESSMAN MIGHT EASILY FIND EAGER RUSSIAN PARTNERS.
IN DEALING WITH THE UKRAINIAN TRUST (NAMED, BATKIVSCHINA) MR. PALM SHOWED OFF LETTERS OF REFERENCE, PURPORTEDLY FROM SENIOR RUSSIAN GOVERNMENT OFFICIALS, SAYS BATKIVSCHINA'S LAWYER PHILIP KAUFLER. MR. PALM ALSO BOASTED OF HIS COMPANY'S TIES TO UNITED NATIONAL REPUBLIC BANK OF RUSSIA OR UNRB.
BUT NO SUCH BANK EXISTS IN RUSSIA, SAYS THE COUNTRY'S CENTRAL BANK. [BUT COULD BE REGISTERED ELSEWHERE]
UNRB FINANCIAL STATEMENTS RECEIVED BY HOD IMPEX, LTD. - A POLISH CONCERN - ARE SIGNED AS AUDITED BY MCIVOR & ASSOCIATES, THE VICTORIA ACCOUNTING FIRM THAT AUDITS ADVANCE CAPITAL SERVICES. BUT CANADA'S OFFICE OF THE SUPERVISOR OF FINANCIAL INSTUTITIONS SAYS, THE BANK ISN'T AUTHORIZED TO CONDUCT ANY BUSINESS FROM CANADA [BUT, IT CAN ELSEWHERE]. A BALANCE SHEET ISSUED BY THE BANK SEEMS ABSURDLY LARGE GIVEN UNRB'S OBSCURITY. ITS $18895-BILLION ['TRILLIONS'] IN CLAIMED ASSETS AS OF NOV 1, 1991 WOULD PLACE IT AMONG THE WORLD'S 30 BIGGEST BANKS.
A FINNISH COMPANY ENGINEERING OFFICE, BERTEL ECKENGREN LTD. ALLEGES IN ITS LAWSUIT THAT IT CONTRACTED WITH MR. PALM, ADVANCE CAPITAL SERVICES, AND UNRB TO BUY 430-MILLION RUBLES IN EXCHANGE FOR 249-MILLION IN MAY 1992. BUT, ECKENGREN SAYS, IT RECEIVED ONLY 71-MILLION RUBLES.
SIMILARLY, BATKIVSCHINA CLAIMS - IN ITS LAWSUIT - THAT IT AGREED WITH MR. PALM TO SELL 724-BILLION RUBLES TO A LICHTENSTEIN COMPANY, CARTESA FINANCE CORP., FOR 311-MILLION IN DECEMBER 1991.
WHEN THE DOLLARS HADN'T ARRIVED AT BATKIVSCHINA'S BANK BY MID1992, THE UKRAINIAN COMPANY SAYS MR. PALM OFFERED IT 35-MILLION OF STOCK IN CARTESA, A COMPANY THE UKRAINIANS SAY WAS ALREADY IN LIQUIDATION.
BATKIVSCHINA IS SUING CARTESA, ADVANCE CAPITAL SERVICES, AND AN INDIANA [USA] COMPANY [?] FOR 109-MILLION UNDER U.S. PROVISIONS ALLOWING TRIPLE DAMAGES IN SUITS THAT PROVE ELEMENTS OF RACKETEERING.
BUT THE SCOPE OF THESE DEALINGS PALES IN COMPARISON TO ACTIVITIES LINKED TO MR. PALM IN CHINA SHORTLY AFTER HIS MEETING AT GUANGXI TRUST IN APRIL 1992. ADVANCED CAPITAL SERVICES APPARENTLY TURNED TO AGRICULTURAL BANK OF CHINA, ONE OF CHINA'S FOUR  NATIONAL BANKS, WHICH HAS A BRANCH IN HENGSHUI, A TOWN SOUTHWEST OF BEIJING, LIKE GUANGXI TRUST.
AGRICULTURAL BANK OF CHINA (HENGSHUI BRANCH) IS NOT ALLOWED TO CONDUCT INTERNATIONAL BUSINESS, BUT THE BANK SAYS ITS HENGSHUI BRANCH MANAGER WAS OFFERED BY MESSERS HUNG MOY AND LEE A 10-BILLION STANDBY LETTER OF CREDIT [SBLC] FROM UNITED NATIONAL REPUBLIC BANK OF RUSSIA IN EARLY 1993.
IN RETURN MESSRS HUNG MOY AND LEE ASKED THE BRANCH TO WRITE 200 SMALLER STANDBY LETTERS OF CREDIT [SBLC] WITH FACE VALUES TOTALING 10-BILLION. THE LETTERS WERE WRITTEN AND SIGNED, APRIL 1.
ALL THE LETTERS OF CREDIT [LOC] WERE LABELED AS BEING BACKED BY, UNITED ASIA GROUP, A NEW YORK REGISTERED COMPANY OF WHICH MR HUNG MOY IS PRESIDENT.
ACCORDING TO AGRICULTURAL BANK IN MAY, AGRICULTURAL BANK WARNED BANKS WORLDWIDE NOT TO ACCEPT STANDBY LETTERS OF CREDIT [SBLC] FROM ITS HENGSHUI BRANCH. A MONTH EARLIER, IT HAD WARNED THEM NOT TO ACCEPT A STANDBY LETTER OF CREDIT [SBLC] FROM ITS BRANCH IN SANYA, ON THE ISLAND OF HAINAN, [CHINA].
THE SANYA LETTER OF CREDIT [LOC] WAS VALUED AT 80-MILLION WITH A VALIDITY OF 20-YEARS. IT LISTED NO BENEFICIARY.
BUT HOD IMPEX, A BUDDING FIRM OF POLISH FOOD BROKERS, GOT THE WARNING TOO LATE. IT HAD STRUCK A DEAL IN FEBRUARY AND MARCH 1992 TO SELL ADVANCE CAPITAL SERVICES 316-MILLION OF POTATOES AND OTHER FOOD FOR DISTRIBUTION AS HUMANITARIAN AID IN THE FORMER SOVIET UNION.
"THIS WAS THE FIRST CASE FOR OUR COMPANY TO BE INVOLVED IN SUCH BIG BUSINESS," SAYS ANDRZEJ JANICKI, SENIOR ADVISER TO HOD IMPEX'S MANAGEMENT.
BECAUSE HOD IMPEX HAD NEVER HEARD OF ADVANCE CAPITAL, IT ASKED DUN & BRADSTREET TO INVESTIGATE ITS CORPORATE AND PAYMENT HISTORY. A COPY OF THE DUN & BRADSTREET REPORT RECEIVED BY HOD IMPEX INDICATED ADVANCE CAPITAL'S PAYMENTS TENDED TO BE SLOW BY ONLY 11-DAYS.
SO BETWEEN MARCH 30 AND MAY 18 HOD IMPEX SENT 373-MILLION OF FOOD TO THE FORMER SOVIET UNION, MAINLY TO BASES OF DEMOBILIZED SOVIET SOLDIERS.
IT THEN STOPPED THE SHIPMENTS BECAUSE ADVANCE CAPITAL HAD STILL PAID NOTHING ON JUNE 8.
ADVANCE CAPITAL TOLD HOD IMPEX IT COULD DRAW 125-MILLION FROM THE GUANGXI TRUST PROMISSORY NOTE. IT WAS LATER HANDED THE STANDBY LETTER OF CREDIT [SBLC] FROM THE SANYA BRANCH OF THE AGRICULTURAL BANK. THE FOOD BROKER LATER DISCOVERED THAT BOTH DOCUMENTS ARE WORTHLESS.
JULIA LEUNG CONTRIBUTED TO THIS ARTICLE.
- - - -
[NOTE/HINT: When viewing the aforementioned article at the Mississippi State University website, you 'may have to wait for the entire page to load' as there are many articles, afterwhich it is recommended you use your computer browser "Edit/Find" menu and enter a 'keyword' such as "Palm" (leave out quotation marks) to find the location of the specific article on that one (1) text-lengthy webpage.]
Mississippi State University (USA) http://www.cavs.msstate.edu/hse/ies/publications/courses/ece_8463/projects/1998_spring/data/lm_train...
Mississippi State University (USA) http://www.isip.msstate.edu/publications/courses/ece_8463/projects/1998_spring/data/lm_training/wsj9...
[NOTE: Should the aforementioned article no longer be available on the internet, go to: [ http://www.archive.org
] and enter the URL (above) to search for the 'approximate date' and URL provided for that article to read it from historical archives if available.]
[NOTE: The information (below) pertains to Robert Earl Palm, UNITED NATIONAL REPUBLIC BANK (of Russia), and SHERWOOD INVESTMENTS (BAHAMAS) LTD. Although the information (below) was primarily written in the GERMAN-language, it was machine-translated into the ENGLISH-language as well (below)]
January 10, 1994
ICC-REPORT (INTERNATIONALE HANDELSKAMMER, PARIS) [In ENGLISH: (“INTERNATIONAL CHAMBER OF COMMERCE, PARIS”)]
Vorwort [In ENGLISH: “Preface”]
Der nachfolgende Artikel von der ICC ist bereits zeitlich überholt. Wir möchten diesen dennoch dem interessierten Leser gerade in der heutigen Zeit anbieten. In einer Zeit also, in welcher am Kapitalmarkt immer mehr Berater und Anbieter mit Topverbindungen zu extrem günstigen Geschäften im Kapitalanlagebereich auftreten. Anhand dieses Artikels kann man ersehen, dass selbst bei Vorlage von Bankpapieren, welche außerhalb der Banken gehandelt werden, äußerste Vorsicht geboten ist. Wir empfehlen grundsätzlich bei solchen Geschäften eine Bank zu Bank Abwicklung. In der Regel trennt sich dabei sehr oft das "Spreu vom Weizen".
[In ENGLISH: The following article of the ICC is already temporally outdated. We would like to offer nevertheless these to the interested reader straight in the today's time. In a time thus, in which at the capital market ever more advisor and offerer with Topverbindungen arise to extremely favorable business within the investment range. On the basis this article one can see that even with collecting main of bank papers, which are acted outside of the banks extreme caution is required. We recommend in principle with such business a bank-to-bank completion. Usually thereby "chaff very often separates from wheat".]
. . .
4. Einige Beispiele für Betrug mit "Dokumente erstklassiger Banken"
[In ENGLISH: Some examples of fraud with "documents of first-class banks"]
4.1. Eine Reihe von Ermittlungsverfahren werden zur Zeit von den Strafverfolgungsbehörden auf der ganzen Welt wegen Finanzschwindel im Zusammenhang mit "Dokumente erstklassiger Banken" durchgeführt. Bei den nachstehenden Beispielen handelt es sich um Fälle, über die bereits ausführlich in der Presse berichtet wurde.
[In ENGLISH: A set of preliminary investigations at present by the prosecution authorities in the whole world because of financial swindles in connection with "documents of first-class banks" are accomplished. With the following examples it concerns cases, on which in the press one reported already in detail.]
4.2 Am 16. Februar 1993 kündigte die Heilsarmee, Großbritanniens größte karitative Einrichtung, in einer sorgfältig formulierten Erklärung an, dass sie um über 6 Mio. US-Dollar betrogen worden sei. Das Geld war den Finanzberatern Stuart Ford, einem Geschäftsmann aus Birmingham, und Gamil Naguib, einem in London lebenden Ägypter, übergeben worden, um es in den Kauf und Verkauf von "Standby-Akkreditiven" zu investieren.
[In ENGLISH: February 1993 announced the welfare army, of Great Britain largest karitative mechanism, in a carefully formulated explanation that they betrogen over over 6-million US dollar were. The money was the financial advisers Stuart Ford, a businessman from Birmingham, and Gamil Naguib, handed over to London living Egyptian, in order to invest it into the purchase and sales of "Stand By Letters of Credit".]
4.3 Das Geld wurde von London nach Belgien überwiesen und ohne Wissen der Heilsarmee vom Konto in Belgien abgezogen. Obwohl das belgische Bankkonto vier Zeichnungsberechtigte besaß, darunter die zwei Finanzberater und zwei Führungskräfte der Heilsarmee, waren für Überweisungen vom Konto nur zwei Unterschriften erforderlich. In diesem Fall waren die Unterschriften die von Ford und Naguib.
[In ENGLISH: The money was transferred from London to Belgium and taken off without knowledge of the welfare army from the account in Belgium. Although the Belgian bank account possessed four  authorized to sign on it, among them the two  financial advisers and two  high-level personnel of the welfare army, the account only saw it necessary for two  signatures for its transfers. In this case the signatures were from Ford and Naguib.]
4.4 Das Geld lief über Konten bei drei Banken in Luxemburg und verschwand, nachdem es nach Panama und Liechtenstein überwiesen worden war. Ebenfalls unauffindbar war die Islamic Pan American Bank, die angeblich die Standby-Akkreditive ausgestellt hatte. Bis heute ist nur ein kleiner Betrag des Geldes ausfindig gemacht und wiederbeschafft worden.
[In ENGLISH: The money was sent to accounts of three  banks, and in Luxembourg it disappeared, after it had been transferred to Panama and Liechtenstein. THE ISLAMIC PAN AMERICAN BANK, which had allegedly issued the Stand By Letters of Credit, was likewise untraceable. Until today only a small amount of the money was ever recovered.]
4.5 Während der Betrug bei der Heilsarmee aufgedeckt wurde, wurde Adrian Powles, Seniorpartner im Londoner Büro der australischen Anwaltskanzlei Allen & Hemsley nach Sydney zurückbeordert, nachdem die Kanzlei entdeckt hatte, dass 20 Mio. US-Dollar an Mandantengeldern fehlten.
[In ENGLISH: While the fraud was uncovered at the welfare army, Adrian Powles, senior partner in the London office of the Sydney Australia law firm of ALLEN & HEMSLEY discovered a back order, after the kanzlei had discovered that 20-million US dollars in mandator funds was missing.]
4.6 Der Großteil der fehlenden Gelder gehörte der Regierung von Nauru, einem Kleinstaat im Südpazifik. Das FBI und die US-Staatsanwaltschaft in New York führen die Ermittlungen in diesem weit reichenden Finanzschwindel. Bisher bleiben 8.5 Mio. US-Dollar an nauruischem Geld unauffindbar.
[In ENGLISH: The majority of missing funds belonged to the government of the Republic of Nauru, a small state in the South Pacific ocean. The FBI and the U.S. public prosecutor's office in New York lead the determinations in this financial swindle handing far. So far 8.5-million U.S. dollars of Nauru money remains untraceable.]
4.7 Das Geld wurde vom Bankkonto des Nauru Phosphate Royalties Trust, Melbourne. Australien, auf Bankkonten weltweit überwiesen. Es sollte für verschiedene Investitionsprojekte verwendet werden, von denen behauptet wurde, dass sie durch "Rahmensicherungsverträge mit erstklassigen Banken" für den Erwerb von "Dokumente erstklassiger Banken" mit einem beträchtlichen Disagio aktiviert würden, die dann wieder mit hohem Gewinn verkauft werden könnten. Die vor der Überweisung von 8,5 Mio. US-Dollar vereinbarte Bedingung besagte, dass das Geld erst bei Aushändigung der Bankdokumente an die Nauruer bei der Powles’Bank freigegeben werden sollte. Die Dokumente wurden nie übergeben.
[In ENGLISH: The money came to the bank account in Nauru from Phosphates Royalties Trust in Melbourne, Australia and was transferred to bank accounts worldwide. It was to be used for different investment projects, by which it was maintained that they were activated by "framework safeguard contracts with first-class banks" for the acquisition of "documents of first-class banks" with a considerable Disagio, which could be sold then again with high profit. The condition agreed upon before the transfer of 8.5-million U.S. dollars meant that the money should be released only when handing the bank documents over in Nauru with the Powles' Bank. The documents were never handed over.]
4.8 Angeblich waren diese Dokumente von der "Commonwealth National Bank of Antigua" ausgestellt, einer "Briefkastenbank", die von Leonard Fruber und Ralph Scheri in New York geleitet wurde. Im Dezember 1992 wurden diese beiden "leitenden Bankangestellten von der Commonwealth National Bank of Antigua" vom New Yorker Bezirksstaatsanwalt wegen versuchter Einlösung eines gestohlenen Schecks im Wert von knapp 1 Mio. US-Dollar angeklagt. Im Juni 1993 wurden die Beiden wegen strafbaren Besitzes von Diebesgut und gefälschten Urkunden verurteilt.
[In ENGLISH: Allegedly these documents were issued by the "COMMONWEALTH NATIONAL BANK OF ANTIGUA", a "mail box bank", which was led by Leonard Fruber and Ralph Scheri in New York. In December 1992 these two  "leading bank employees" of COMMONWEALTH NATIONAL BANK OF ANTIGUA were accused in New York by the district public prosecutor of trying to redeem funds using a stolen cheque valued just under 1-million US dollars. In June 1993 the two  were condemned and punished for possession of stolen property and falsified documents.]
4.9 Der australische Rechtsanwalt Adrian Powles befindet sich in psychiatrischer Behandlung und muss sich nun in mindestens zehn Betrugsfällen verantworten. Die Polizei in Großbritannien und Australien ermittelt ebenfalls in dieser Betrugssache.
[In ENGLISH: The Australian attorney Adrian Powles is under psychiatric treatment and must answer to charges in at least ten  fraud cases. The police in Great Britain and Australia are also looking into this fraud operation.]
4.10 Die Firma Turnberry Underwriters wurde im August 1992 in Florida, USA, gegründet. Sie startete eine umfangreiche Werbekampagne im Wirtschaftsteil europäischer Zeitungen, in der sie sich als Vertreter eines großen Trusts ausgab und sich bereit erklärte, auf Wunsch "Dokumente erstklassiger Banken" für Risikokapital zu liefern. Diese Werbeanzeigen erwiesen sich für kleine Firmen, die dringend auf Kapital angewiesen waren, als besonders attraktiv.
[In ENGLISH: The company TURNBERRY UNDERWRITERS was created in August 1992 in Florida, USA. It started an extensive advertising campaign in European newspapers pertaining to restaurant economics, in which it offered itself as a representative of large trusts and explained it was ready to supply desireable "documents of first-class banks" for risk capital. These advertisements proved particularly attractive for small companies, which were urgently dependent on capital.]
4.11 Die Antragsteller wurden gebeten, den sorgfältig formulierten Vertrag zu unterzeichnen und 2% des erforderlichen Kapitals auf einem Treuhandkonto in Miami zu hinterlegen. Das Konto wurde vom Anwalt Turnberrys, Jerry Breslin, verwaltet, der inzwischen verhaftet und der Verabredung zum Handel mit US-Schatzobligationen, die einem New Yorker Kreditinstitut gestohlen worden waren, beschuldigt wurde. In der Vereinbarung waren den Vertragspartnern Bedingungen über Nichtoffenlegung und Nichtumgehung auferlegt worden.
[In ENGLISH: The applicants were asked to sign the carefully formulated contract and to deposit 2% of the necessary capital on a trust account in Miami. The account was administered by TURNBERRY lawyer Jerry Breslin, who had been accused and arrested while trying to trade U.S. Treasury obligations stolen from the New York Credit Institute. In the agreement, conditions over Nichtoffenlegung and Nichtumgehung had been imposed upon by the contracting parties.]
4.12 Die Antragsteller erhielten zehn Tage Zeit, eine Bankgarantie über 10% des Gesamtdarlehnes als Provision für Turnberry einzuholen, bevor die Gelder freigegeben wurden. Laut Turnberry war dies mit den Geldgebern der Antragsteller so vereinbart worden.
[In ENGLISH: The applicants received ten  days time to catch up a bank guarantee over 10% of the Gesamtdarlehnes as commission for TURNBERRY before the funds were released. According to TURNBERRY this had been agreed upon in such a way with the backers of the applicants.]
4.13 Als sich die Antragsteller an ihre Banken wandten, stellten sie fest, dass die Banken Schwierigkeiten hatten, die von Turnberry verlangten Garantien auszustellen. Die gewährte Frist lief bald ab, und Turnberry behauptete, der Antragsteller sei im Verzug und behielt die hinterlegten 2% ein.
[In ENGLISH: When the applicants turned to their banks, they stated that the banks had difficulties in issuing the warranties required by TURNBERRY. The granted period soon lapsed, and TURNBERRY stated the applicant was in default and retained the deposited 2%.]
4.14 Nach Angaben der Financial Times schätzen die US-Behörden, dass die Firma Turnberry und mit ihr verbundene Gesellschaften und Personen bis zu 30 Mio. US-Dollar an Vorschüssen (Anzahlungen) von amerikanischen Firmen erhielten. Sie glauben, dass Firmen außerhalb der Vereinigten Staaten, hauptsächlich aus Großbritannien und Irland, weitere fünf bis zehn Mio. US-Dollar als Anzahlung an Turnberry leisteten. Die britischen Behörden ermitteln nun gemeinsam mit dem FBI in Miami, USA gegen Turnberry und Konsorten.
[In ENGLISH: According to information from the FINANCIAL TIMES, U.S. authorities estimate the company TURNBERRY is connected to societies and persons who received upwards of 30-million US dollasr as advances (pre-payments) from American companies. They believe companies carried outside of the United States, mainly from Great Britain and Ireland, furthered it for five  to 10-million US dollars beyond the TURNBERRY pre-payment. The British authorities are determining with the FBI in Miami, USA against TURNBERRY and KONSORTEN.]
4.15 Im Juli 1993 teilte das Büro für Öffentliche Sicherheit in einem der größten Betrugsfälle in China seit Verabschiedung des Wirtschaftreformprogramms des Landes im Jahre 1979 mit, dass es zwei Amerikaner, Francisco Hung Moy und Raymond Lee, festgenommen habe. Die beiden wurden verdächtigt, Beamte einer ländlichen Filiale der Agricultural Bank of China überredet zu haben, 200 Standby-Akkreditive in Höhe von insgesamt 10 Mrd. US-Dollar zugunsten von Sherwood Investment (Bahamas) Ltd. auszustellen.
[In ENGLISH: In July 1993 the Office for Public Security in one of the largest fraud cases communicated in China since verabschiedung of the restaurant reform program of the country in the year 1979, said that it had arrested two  Americans, Francisco Hung Moy and Raymond Lee. Officials of a rural branch for the AGRICULTURAL CENTRAL BANK OF CHINA said the two  suspects had persuaded the issuance of 200 Stand By Letters of Credit (SBLC) in an amount totalling 10-Billion U.S. dollars in favor of SHERWOOD INVESTMENTS (Bahamas) LTD.]
4.16 Als Sicherheit diente ein Akkreditiv, das die United National Republic Bank of Russia ausgestellt hatte, eine Bank, die nicht existiert. Die Agricultural Bank gab an Banken weltweit eine Warnung heraus, die Standby-Akkreditive nicht honorieren, die bei ihrer Einlösung ein Fünftel der gesamten Devisenbestände Chinas wert wären.
[In ENGISH: As security, a Letter Of Credit (LOC) worth one-fifth (1/5th) of the entire foreign exchange reserves of China (after redemption) had been issued by UNITED NATIONAL REPUBLIC BANK OF RUSSIA, a bank which did not exist. The China Agricultural Central Bank published a worldwide bank warning regarding Stand By Letters of Credit (SBLC) they do not honor.]
4.17 Glücklicherweise führte ein Tipp aus der Unterwelt zur Entdeckung von 188 Urkunden in Großbritannien. Die Standby-Akkreditive waren offensichtlich von einem Nigerianer ins Land gebracht worden, der zuerst zahlreiche Kopien davon angefertigt hatte und diese dann von britischen Rechtsanwälten auf Übereinstimmung mit dem Original beglaubigen ließ. Den eingegangenen Informationen zufolge betrug der gewünschte Platzierungspreis 83% des Nennwertes. Eine britische Brokerfirma war um ihre Platzierung bemüht.
[In ENGLISH: Fortunately a tap led from the underworld to the discovery of 188 documents in Great Britain. The Stand By Letters of Credit (SBLC) had been brought into the country by a Nigerian, who obviously first made numerous copies of it and presented these for authentication to British attorneys for agreement with the original. According to the information received the desired placement price amounted to 83% of the nominal value. A British broker company was endeavoring placement.]
4.18 Im Juni 1993 wurden ca. 20 Mio. Pfund Sterling vom Konto der Managed Opportunities Limited auf Jersey auf das Konto von "The Hanover Bank Limited" auf Zypern überwiesen.
[In ENGLISH: In June 1993 approximately 20-million pounds sterling was transferred from the account of MANAGED OPPORTUNITIES LIMITED in Jersey [Channel Islands] to an account by "THE HANOVER BANK LIMITED" in Cyprus.
4.19 Managed Opportunities Limited, eine auf der Isle of Man gegründete Invetmentfirma, ist eine Tochtergesellschaft von CMI Insurance Company Limited unter der Konzernleitung von Clerical, Medical and General Life Assurance Society of the United Kingdom. Das Geld sollte nach Angaben der Hanover Bank Limited zum An- und Verkauf von "Dokumente erstklassiger Banken" genutzt werden.
[In ENGLISH: MANAGED OPPORTUNITIES LIMITED, on the Isle Of Man created INVETMENTFIRMA, a subsidiary of CMI INSURANCE COMPANY LIMITED under the company line of CLERICAL MEDICAL AND GENERAL LIFE ASSURANCE SOCIETY of the United Kingdom. According to data of THE HANOVER BANK LIMITED the money was to be used on the sales of "documents of first-class banks".]
4.20 The Hanover Bank Limited, eine Offshore-Bank in Form einer Mantelgesellschaft, wurde am 12. August 1992 in Antigua gegründet. Nach Angaben der Hanover sollten die Dokumente von Corporate Financial Investments of London über Kinitor Trading Limited, eine Zypriotische Offshore-Gesellschaft, die am 17. November 1992 von einem zypriotischen Rechtsanwalt gegründet wurde, beschafft werden.
[In ENGLISH: THE HANOVER BANK LIMITED, an offshore bank formed by a shell company, was created on August 12, 1992 in Antigua. According to the data of HANOVER the documents would be procured by CORPORATE FINANCIAL INVESTMENTS OF LONDON over to KINITOR TRADING LIMITED, a Cyprus offshore company, which was created on November 17, 1992 by a Cyprus attorney.]
4.21 Über die Verbindung zwischen Hanover und Corporate Financial Investments ist derzeit noch nichts bekannt. Allerdings wurde festgestellt, dass Tony Fitzpatrick, ein irischer Geschäftsmann und geschäftsführender Direktor von Hanover, dieselbe Londoner Anschrift und Telefonnummer besitzt wie der irische Geschäftsmann Peter Bolger, der Direktor von Corporate Financial Investments ist.
[In ENGLISH: At the present time very little is known about the connection between THE HANOVER BANK LIMITED and CORPORATE FINANCIAL INVESTMENTS OF LONDON. However it was stated that Tony Fitzpatrick, an Irish businessman, and acting director of THE HANOVER BANK LIMITED use the same London address and telephone number as the Irish businessman Peter Bolger, who is a director of CORPORATE FINANCIAL INVESTMENTS OF LONDON.]
4.22 Die Firma Clerical Medical International versucht seit Juli 1993, die 20. Mio. Pfund Sterling wieder aus Zypern zurückzuholen. In dem Fall ermitteln jetzt die britischen und zypriotischen Behörden.
[In ENGLISH: The company CLERICAL MEDICAL INTERNATIONAL has tried since July 20, 1993 to fetch back the 20-million pounds-sterling again from Cyprus. In the case now being determined by British and Cyprus authorities.]
. . .
- - - -
ALPHA CONSULTING GROUP
TEL: +(+49) 06301-71669-0
FAX: + (+49) 06301-71669-9
E-MAIL: email@example.com http://alpha-credit-web.de/F41_ICC-Report.htm
[NOTE: The credit report information (below) refer to the aforementioned ICC report named entities.]
Credit Report Date: 05 March 1997
Credit Report Date: 02 February 2000
SHERWOOD INVESTMENTS (BAHAMAS) LTD. [Report ID: 264502]
SHERWOOD RESTAURANTS LTD. [Report ID: 408530]
P.O. Box N 7768
INTERNATIONAL COMPANY PROFILE (ICP) - Credit Reports
6 - 14 Underwood Street
London N1 7JQ
TEL: +44 (0) 20 7566 8274
ICP is a company of WILMINGTON GROUP PLC., quoted on the London Stock Exchange. http://www.icpcredit.com/ReportRequest.asp?sCompanyID=115003
[NOTE: The information (below) is only a ‘partial list’ of assets SHERWOOD INVESTMENTS (BAHAMAS) LTD provided in two (2) joint venture agreements (below) indicating transaction dates of February 25th 1996, March 27th 1998, November 18th 1998, and July 23rd 1999 for a total value of $51.3-billion with FIRST INTERNATIONAL BANK OF GRENADA LIMITED (a now defunct independent offshore bank), GENESIS HOLDING CORP, and MUTUAL ASSETS LIMITED. Amongst the aforementioned assets (listed below), were several other assets, of which one was a $500-Million letter of credit (LOC) provided by the BANK OF TOKYO MITSUBISHI LTD that Robert Earl Palm saw SHERWOOD INVESTMENTS (BAHAMAS) LTD obtain 50% of the trading profits from via a joint venture contract agreement through trading partners of CHADWICK INVESTMENTS LTD., which were to be shared likewise (50%) - using MUTUAL ASSETS LIMITED trading partners so that FIRST INTERNATIONAL BANK OF GRENADA LTD. could derive its 50% of those traded profits. Unfortunately for FIRST INTERNATIONAL BANK OF GRENADA LTD it later discovered - nine (9) months into that trading - two (2) executives of MUTUAL ASSETS LIMITED absconded with the bank’s share of profits, which law enforcement found stuffed into two (2) MUTUAL ASSETS LTD. executives personal bank accounts. Trading was suspended, and FIRST INTERNATIONAL BANK OF GRENADA LTD never realized its joint venture contract agreement promise to receive 50% of those trading profits.]
$47.5 Billion (Gold Bullion):
1. Investment & Humanitarian Projects Agreement with Transaction code #ATCF- KBUZU 0KA 250296 1147.5US$
Signed by Mr. Kazutoshi Okasaki, Mr. John (Hans) Zuercher, Craig L. Hubner
1.1 Schedule "A"
BANK OF JAPAN Custodial Receipt issued by key test TELEX only
Official Certification B No. 2083/2084 (Certifying signatures of Hans Zuercher and Kazutoshi Okazaki)
1.2 Schedule “B”
Deed of Assignment transaction code #ATCF KBUZU OKA 250296B47.5US$ From Mr. Hisao Sato (Present Owner) and Mr. Kazutoshi Okazaki (Present Owner & Attorney In Fact for Mr. Hisao Sato) For the Benefit of SHERWOOD INVESTMENTS (BAHAMAS) LTD. and / or SHERWOOD INVESTMENTS (BAHAMAS) LTD's duly appointed administrator, MUTUAL ASSETS LIMITED
Addendum to the Investment & Humanitarian Projects agreement with transaction code #ATCF KBUZU OKA 250296 B47.5US$ signed by Mr. Kazutoshi Okasaki, Mr. John (Hans) Zuercher, Craig L. Hubner
Official Certification B No. 2094/2095 (Certifying signatures of Hans Zuercher and Kazutoshi Okazaki)
2. The Joint Venture Agreement under transaction code No. SHER FI JV 181198
Joint Venture Agreement between SHERWOOD INVESTMENTS (BAHAMAS) LTD. and FIRST INTERNATIONAL BANK OF GRENADA, LIMITED
2.1 Amendment to Agreement transaction code No. SHER FI JV 181198
Joint Venture Agreement including SHERWOOD INVESTMENTS (BAHAMAS) LTD and FIRST INTERNATIONAL BANK OF GRENADA LIMITED and GENESIS HOLDING CORP
2.2. Deed of Assignment (made July 23rd, 1999)
Deed of Assignment of 47.5B from SHERWOOD INVESTMENTS (BAHAMAS) LTD to FIRST INTERNAT10NAL BANK OF GRENADA LIMITED
$3.8 Billion (in Dai Ichi Kangyo Bank Co. Ltd. Bank Cheques)
1. Investment & Humanitarian Projects Agreement with Transaction Code #KBUZU OKA 27398 B3.8$
Agreement between Kazutoshi Okazaki & John (Hans) Zuercher and SHERWOOD INVESTMENTS (BAHAMAS) LTD
B/W Copy of Cheque # 871(AI57602) and 872(AI57602) front and back
B/W Copy of Zurcher's Passport front, back and inside
B/W Copy of Okazaki's Passport
1. Schedule "A" Deed of Assignment with transaction code #KBUZU OKA-27398 B3.8$
Deed of Assignment Mr. Kazutoshi Okazaki Present Owner & Attorney In Fact, Mr. John (Hans) Zuercher for the benefit of SHERWOOD INVESTMENT (BAHAMAS) LTD. and / or SHERWOOD INVESTMENT (BAHAMAS) LTD's duly appointed administrator, MUTUAL ASSETS LIMITED
Official Certification B No. 2087/2088 (Certifying signatures of Hans Zuercher and Kazutoshi Okazaki)
3. Deed of Assignment (made November 18th, 1998)
Deed of Assignment from SHERWOOD INVESTMENT (BAHAMAS) LTD. and FIRST INTERNATIONAL BANK OF GRENADA LIMITED of the two DAI-ICHI KANGYO BANK CO. LTD. Cheques No. 871 (Al 57602) and 872(Al 57602)
4. Joint Venture Agreement (made November 18TH, 1998) Transaction code No.
JV between SHERWOOD INVESTMENT (BAHAMAS) LTD. and FIRST INTERNATIONAL BANK OF GRENADA LIMITED under transaction code No. SHER FI JV181198
Amendment to the Agreement under transaction code No. SHER FI JV181198 made July 20th, 1999 adding GENESIS HOLDING CORP to the Joint Venture
5. General Power of Attorney
Showing the authority of Mr. Kazutoshi Okazaki specifically for the two  DAI-ICHI KANGYO BANK CO. LTD. Cheques
Showing the authority of Mr. Kazutoshi Okazaki on a total of four  different cheques
6. Letter of Intent
Signed by Mr. Takeharu Okitsu, Mr. Tetsuro Saito, and Mr. Kazutoshi Okazaki
Declaration of Ownership by Mr. Kazutoshi Okazaki
Certifies Mr. Kazutoshi Okazaki to have authority over the two  cheques signed by two  at the FINANCE MINISTRY of JAPAN
9. B/W Copy of Cheque # 871(Al57602) and 872(Al57602)
Front and back
10. Confirmation Documentation
Issued to BARCLAYS BANK PLC Confirming Authenticity, Signatory Bank Officers who signed the Cheques, etc. Signed by Ryutaro Hasimoto [aka Ryutaro Hashimoto], The Prime Minister of Japan
Issued to Mr. Karel Timmermans (Confidential) confirming authenticity of the Cheques on behalf of the Japanese Government signed by Ryutaro Hasimoto [aka Ryutaro Hashimoto], The Prime Minister of Japan
Issued to Whom It May Concern Confirming authenticity of the Cheques on behalf of the JAPANESE FINANCE DEPARTMENT signed by Mr. Sadakazut Tanigaki
[NOTE: Dan Bobocel was the former President of SHERWOOD INVESTMENTS (BAHAMAS) LTD. - as mentioned in the ICC report (above) - and CHADWICK INVESTMENTS LTD.]. Daniel Bobocel was also named as the President of SHERWOOD-DROLET LTEE [CORP.] (Alberta, Canada) in 2004 (below).]
PARTI PROGRESSISTE-CONSERVATEUR DU CANADA [PROGRESSIVE CONSERVATIVE PARTY OF CANADA]
1(b) Contributions in excess of $100:
SHERWOOD-DROLET LTEE.: 289
DANIEL BOBOCEL: 182
- - - -
Reference(s), at: http://www.elections.ca/fin/fis/pc.txt
THE PHOENIX BUSINESS JOURNAL - EXCLUSIVE REPORTS
October 4, 1996 (print edition)
SEC Files $1.77M Action Against Garcis USA
by Mary Vandeveire, staff writer (The Business Journal)
The Securities and Exchange Commission is taking two Valley residents to court to get back $1.77 million they allegedly gained through fraudulent stock sales.
The SEC complaint, filed in the U.S. District Court in Arizona, names Robert Poirier and Robert Palm and the sales of securities of Garcis USA Inc., an athletic equipment distributor formerly located in Scottsdale.
This is not Poirier's first scrape with the federal agency. An SEC injunction was placed against Poirier about two years after he moved here in 1986 from Oregon, a state where he had left a legacy of dubious business deals.
The SEC action filed Sept. 30 makes charges tied to activities occurring from September 1994 through September 1995.
In what federal officials call a "classic'' pattern, Poirier and Palm, aided by co-defendants Richard Wensel and James Vincent, allegedly took over Garcis, brought it public, kept their own involvement hidden, acquired a large block of shares, pumped the price up and sold the shares.
Along the way, they allegedly engaged in questionable trading activities and dragged such businesses as Southwest Airlines, The Phoenician resort and the Scottsdale Hilton hotel into their muddy scheme with false claims of product orders and contracts.
The SEC alleges that through their firm, Select Financial Corp. -- which was located in the same Scottsdale site as the Garcis office -- Poirier and Palm controlled operations of Garcis, promoted its stock and evaded SEC registration requirements -- such as resale restrictions and disclosure of ownership interest. The underlying motive, according to the SEC, was to sell stock and make money.
"When they were ready to sell, they avoided depressing the price of the stock -- which usually happens when a 'sell' order is placed -- by getting information out that promoted the company or by creating 'volume' in the stock with sales between their own accounts," said Daniel Nathan, assistant director of the SEC's enforcement division.
Nathan said the charges allege the two would also direct contacts and acquaintances to contact brokers, and sold shares out of their accounts directly to customers.
"We have no comment on whether we view the brokers' role in this matter as blameless or not, but the investigation is continuing," Nathan said.
Some of the shares were held in accounts at ADM Securities, which closed its Phoenix office three weeks ago, and Yee Desmond Schrader & Allen of Phoenix, according to the filing.
"If Poirier and Palm are customers, we keep everything about our customers and customer base confidential," said Jim Allen, managing director of Yee Desmond.
A manager from ADM Securities' Chicago office was not available for comment.
Information that Poirier, Palm and Wensel put out to promote Garcis, the filing alleges, included claims that were passed to a stock newsletter writer about orders for product from Southwest Airlines, The Phoenician and the Scottsdale Hilton.
Nathan would not disclose the inquiry, or inquiries, that led to the Sept. 30 filing.
"When you're giving out false information about major American companies, someone's bound to come to us," Nathan said.
An attorney for Southwest Airlines, Don Hood, said the airlines had at one point been trying to contact the principals of Garcis in connection with Southwest's licensing program. "We never got in touch with them, and the next thing we knew, the SEC was in touch with us," Hood said. He added that it was through the SEC investigation that the airline learned of Garcis' claims. A spokeswoman for The Phoenician said managers weren't aware of the claims.
The SEC action against Poirier and the others seeks to relieve the defendants of the profits made in their scheme, assess fines for stock regulation violations and bar Poirier, Palm and Wensel from serving as officers or directors of publicly held companies.
The defendants have 20-days from the filing date to respond. Assistant U.S. Attorney Lee Stein said any trial is at least a year off.
Poirier, a resident of Fountain Hills, came to Arizona in 1986. Stemming in part from federal investigations there, the U.S. District Court in Oregon in 1988 enjoined Poirier, a Canadian citizen, from future violations of securities regulations, citing earlier activities that basically followed the fraud formula allegedly carried out in Phoenix.
Palm, also a Canadian citizen, is listed as a Scottsdale resident.
Vincent lives on the Isle of Man, British Isles, and Wensel is a Scottsdale resident.
Attempts to reach the defendants were unsuccessful.
- - - -
American City Business Journals Inc. http://www.bizjournals.com/phoenix/stories/1996/10/07/story6.html
STATE OF ARIZONA
Secretary Of State
Arizona File No.: F-0811512-0
Date Assigned: 20JUN97
Last Updated: 17NOV98
Status: REVOKED-MAINTAIN STATUTORY AGENT
Status Date: 11/01/2000
Statutory Agent Status: 14MAY99
Character of Business: Consultants
Stock: 200,000 shares
Robert Palm (President, CEO, Treasurer) 
SELECT FINANCIAL CORP.
8777 N. Gainey Center Drive - #255
Scottsdale, Arizona 85258
TEL: (602) 998-8878
6215 E. Horseshoe Road
Paradise Valley, Arizona 85253
675 Fairview Drive - #246
Carson City, Nevada 89701
- - - -
Robert Poirier (Secretary)
8777 N. Gainey Center Drive - #255
Scottsdale, Arizona 85258
Date Assigned: 06/20/1997 Last Updated: 11/17/1998
- - - -
# of Docs Location Date Description
1 1136-001-015 20JUN97 APPLICATION FOR AUTHORITY
2 0211-051-021 11AUG97 PUB OF APPL FOR AUTHORITY
3 1774-003-374 15MAY98 98 ANNUAL REPORT
3 1505-001-116 15SEP98 98 ANNUAL REPORT
2 0242-014-011 14MAY99 AGENT RESIGNATION
1 1354-026-044 04OCT99 REVOCATION/MAIL RETURNED
1 1397-012-006 11APR00 00 ANNUAL REPORT/MAIL RETURNED
2 0264-035-019 01NOV00 CERTIFICATE OF REVOCATION
[NOTE: The article (below) was taken from a news article in THE PROVINCE (British Columbia, Canada) dated January 19, 2003 that was later translated into another language, which provides several English-language names (below).]
Date: 01-20-03 18:39
Autor: W.Glowacki (---.vc.shawcable.net) [Vancouver, British Columbia, Canada]
Tylko kiedy beda pieniadze?
W piatek 17 stycznia 2003, Najwyzszy Sad Prowincji British Columbia w Wiktorii, Kanada, decyzja sedziego SN Allena Melvina, uznal w calosci zadania polskiej spoldzielni rolniczej Hod Impex, wzgledem Advance Capital Services Corp. i jej wlascicielowi Robertowi Palmowi. Suma odszkodowania wynosi US 37 milionow dolarow, chociaz polskiej spolce przysluguje wiecej niz 50 milionow.
Orzeczenie zamyka ponad dziesioletnia sprawe, wytoczona w 1993 przez HOD IMPEX, tyczaca oszustwa jakiego dopuscil sie Palm i jego firma, wzgledem polskiej spolki. Ze wzgledu jednak na fakt, ze Jason Dallas, jego wspolpracownik, rownoczesnie wspolwlasciciel firmy odsiadywal wyrok w Polsce, wyrok zostal orzeczony tylko w stosunku do Roberta Palma, z tytulu odpowiedzialnosci cywilnej za popelnione oszustwa.
W 1991 roku, Robert Palm- jako duchowny pentakostalny , wystepujacy w imieniu "grupy chrzescijanskich biznesmenow" i Jason Dallas, wystapili do Hod Impex z oferta eksportowa do Rosji polskich produktow rolnych w ramach akcji humanitarnej, na ogolna sume US 300 milionow. Na pokrycie swojej oferty zakupu, Palm przedlozyl dokumenty bankowe z United National Republican Bank, wykazujace pokrycie bankowe w wysokosci US 1.88 miliardow dolarow. Na sam poczatek, Hod Impex wyeksportowal produktow rolnych za sume 37 milionow, co mialo byc poczatkiem umowy. Przez kolejne dwa lata, spolka nie otrzymala ani centa zaplaty za dokonany eksport. W 1993 roku, oddano sprawe do sadu.
Jak wykazaly pozniejsze dochodzenia, wspomniany bank istnial tylko na papierze, zas jego szefem byl sam Palm. Okazalo sie nadto, ze zaledwie po roku istnienia banku, nie mozna bylo znalezc ani grosza, zas Palm nie potrafil wiarygodnie udowodnic znikniecia wkladow. Nadto bank nie posiadal zadnej licencji uprawniajacej do jego dzialanosci.
Sedzia w slownym uzasadnieniu wyroku, kilkakrotnie podkreslil "sliskosc, kretactwo, klamstwo, wszystko wystepujace na porzadku dziennym u Roberta Palma....Sluchanie wywodow lub tlumaczen Palma, oraz branie ich za dobra monete, bylo niczym innym, jak proba z jego strony ponizenia czyjejs inteligencji. Robilo sie niedobrze"- zakonczyl sedzia.
Jerzy Winski, prawnik Hod Impex, nie jest jednak az tak zadowolonym z orzeczenia. "Przede wszystkim nie jest wiadomym dokladnie, gdzie jest w tej chwili Palm, jego telefon nie znajduje sie na liscie abonentow Victorii, nie wiadomo tez, czy Palm jest wyplacalna osoba"--konczy polski prawnik. [The Province, 19/01/2003]
- - - -
[NOTE: Should the aforementioned article no longer be available on the internet, go to: [ http://www.archive.org
] and enter the URL (above) to search for the 'approximate date' and URL provided for that article to read it from historical archives if available.]
BRITISH COLUMBIA SECURITIES COMMISSION (Canada)
INDEX OF DECISIONS
Date Decision Issued:
February 14, 1992
In The Matter Of:
- ROBERT PALM
- DAVID LYON (ASHTON & LYON – Vancouver Law Firm)
- JASON DALLAS
- MICHAEL DOHERTY
- ADVANCE CAPITAL SERVICES CORPORATION
- GREENWELL RESOURCES CORPORATION
- SUPREME RESOURCES INC.
Date Of Weekly Summary: 02/21/92
Edition Of Weekly Summary: 92:08
GREENWELL RESOURCES CORPORATION [Decision]
The meeting took place during the afternoon of August 25 at the Exchange and was attended by ROBERT PALM of ADVANCE, Alec Lenec, Baker and Irving from GREENWELL and David Anfield of Sobolewski Anfield.
- - - -
SUPREME RESOURCES INC.
Name: Supreme Resources Inc
File Number: X012802
Registration Type: SI: Security Issuer
Registration Status: Historic
Approved Date: 03/09/1984
Effective Date: 03/09/1984
Terminated Date: 01/11/1985
Suspension Start Date:
Suspension End Date:
Expiry Date will be December 31 of the current year, unless specified in restrictions and conditions.
Restrictions and Conditions
Restriction: The following only are authorized to engage in the primary distribution to the public of securities of the companys own issue under this registration (Sec 20(1) SECURITIES ACT)
Restriction: Subject to the conditions attached to and forming part of this certificate
- - - -
[NOTE: The official information (below) has been ‘removed’ from the official Canadian government website.]
Document No.: 92/02
Subject: Securities Commission Releases GREENWELL / SUPREME [Decision]
Published Date: 02/21/1992
Released: February 14, 1992
Contact: Ron Messent
The British Columbia Securities Commission today released a decision on several applications regarding investigations into trading in the shares of GREENWELL RESOURCES CORPORATION and SUPREME RESOURCES INC.
Temporary cease trade orders were issued against the shares of GREENWELL and SUPREME in 1987. Those orders were extended and remain outstanding.
In July 1990, a member of the Commission ordered an investigation into the affairs of Greenwell, Supreme and others, based on allegations that certain ‘persons had traded shares’ of GREENWELL and SUPREME ‘in the United States subsequent to the cease trade orders’.
Four of those under investigation, ROBERT PALM, ADVANCE CAPITAL SERVICES CORPORATION, JASON DALLAS, and MICHAEL DOHERTY, applied to have the investigation order revoked. They argued that the cease trade orders were invalid, the investigation order had not been properly issued and the investigation was beyond the Commission's jurisdiction.
The Commission dismissed these applications.
In October 1990, a member of the Commission ordered an ‘investigation into the affairs’ of GREENWELL and DAVID LYON, who was ‘alleged to have traded shares’ of GREENWELL ‘subsequent to the cease trade order’.
LYON requested a hearing and review, and asked that the investigation order be revoked, making similar arguments to those by the other applicants. He argued in the alternative that the investigation order was too broad and vague.
The Commission decided to vary the ‘October 1990 investigation’ order to provide a more appropriate specification of the ‘scope of the investigation’.
Copies of the Commission's decision (18 pages) may be obtained in person at 1100 - 865 Hornby Street, Vancouver, British Columbia.
[NOTE: The official information (above) has been ‘removed’ from the official Canadian government website.]
- - - -
Notices and Interpretation Notes - History
Document No.: 93/03
Subject: Decisions of the British Columbia Securities Commission
Published Date: 01/08/1993
Effective Date: 01/07/1993
Repealed Date: 05/11/1995
Repealed Reason: Lapsed
This notice is accompanied by a list of the decisions of the British Columbia Securities Commission for the years 1987, 1988, 1989, 1990, 1991 and 1992.
The list, which is intended as a reference guide, provides the dates and decisions were issued, the names of the respondents or applicants, and the dates and edition number of the Weekly Summary in which the decisions were published.
DATED at Vancouver, British Columbia, on January 7, 1993.
Douglas M. Hyndman
INDEX OF DECISIONS OF THE BRITISH COLUMBIA SECURITIES COMMISSION
January 8, 1993
Date Date of Edition
Decision Weekly of
Issued Summary Weekly
(mm/dd/yy) In the Matter of: (mm/dd/yy) Summary
. . .
02/14/92 ROBERT PALM, DAVID LYON, JASON DALLAS, MICHAEL DOHERTYGREENWELL RESOURCES CORPORATION, and SUPREME RESOURCES INC.
02/21/92 ROBERT PALM, DAVID LYON, JASON DALLAS, MICHAEL DOHERTYGREENWELL RESOURCES CORPORATION, and SUPREME RESOURCES INC. 92:08, (Page 5)
. . . .
- - - -
[NOTE: The following information (website link provided immediately below) has been ‘erased’ by the British Columbia Securities Commission website. Hence, the reason for only providing a ‘portion’ (below) of its eighteen (18) pages, which is now only obtainable in-full if requested ‘in-person’ (see note further below).]
British Columbia Securities Commission
Chapter 2 - Hearing Decisions
Weekly Summary, Edition 89:125
Indexed as: Greenwell Resources Corp. (Re)
IN THE MATTER OF the Securities Act, S.B.C. 1985, c. 83
AND IN THE MATTER OF Greenwell Resources Corporation
AND IN THE MATTER OF Harold Dale Baker and Thomas Rodney Irving
Decision and Reasons
D.M. Hyndman, E.L. Lien, J.P.H. McCall
Heard: November 22, 1988
Decision: June 19, 1989
Boris W. Tyzuk, for the Superintendent of Brokers.
Kenneth W. Ball, for Harold Dale Baker.
Douglas R. Garrod, for Thomas Rodney Irving.
DECISION AND REASONS:-- The matters that were the subject of this hearing were first set out in a Notice of Hearing dated July 29, 1988. In this notice the Superintendent of Brokers sought an order under section 145 of the Securities Act (the "Act") to remove the trading exemptions of Harold Dale Baker ("Baker"), the corporate secretary of Greenwell Resources Corporation ("Greenwell"), and Thomas Rodney Irving ("Irving"), a director of Greenwell. The Commission was asked to determine whether, in connection with purchases of Greenwell's shares, Baker and Irving had breached section 68(1) of the Act, which prohibits a person in a special relationship with a reporting issuer from purchasing or selling securities of the issuer with knowledge of a material fact or material change in its affairs that he knows or ought reasonably to know has not been generally disclosed.
In an Amended Notice of Hearing dated October 26, 1988, the Commission was asked to consider whether a sale of Greenwell shares by Baker was also in breach of section 68(1). The Superintendent also sought additional orders in the Amended Notice, firstly, that Baker and Irving be prohibited from acting as directors or officers of an issuer under section 145.1 of the Act and, secondly, that they pay the costs of the hearing under section 154.2 of the Act. Sections 145.1 and 154.2 were added to the Act by an amendment which came into force in August 1988.
Greenwell was a reporting issuer listed on the Vancouver Stock Exchange ("the Exchange") throughout the period when the critical events took place between October 1986 and August 1987. Greenwell had completed a public financing in September 1986 to raise $194,000, of which $75,000 was spent on a Nevada gold property. Greenwell had three employees at that time.
On October 1, 1986 Greenwell issued a news release stating that a letter of intent had been signed for the acquisition of $100 million of assets in exchange for the issuance of convertible preferred shares (the "Acquisition"), subject to shareholder and regulatory approval. Further news releases confirming the Acquisition were issued on November 17, 1986 and February 12, 1987. These were followed up with a President's Message to Shareholders, dated March 2, 1987, issued in connection with Greenwell's annual meeting. This document provided no more detailed information about the Acquisition than the previous releases, other than to describe the assets as U.S. real estate.
Michael Gilley ("Gilley"), a listings officer at the Exchange, testified that on April 21, 1987 he advised Greenwell verbally that it was in breach of its listing agreement because it had failed to provide a Reverse Takeover Information Statement and back-up documentation in the required 30 days from the date of the letter of intent. This advice was confirmed in a letter from the Exchange dated May 12. Greenwell provided the required documentation to the Exchange on June 12.
The Acquisition contemplated the purchase of U.S. real estate assets, including a large ranch in Texas. Gilley reviewed the proposed transaction and was concerned about the value shown for the ranch. With Greenwell's agreement, the Exchange retained a consultant to review the appraisal reports. A report was received from the consultant on July 27,
In a letter dated July 28 Gilley posed to Greenwell a number of questions regarding the deficiencies he had identified in the Acquisition disclosure documents. Specifically he was concerned because the ranch had been appraised at a value which appeared to be excessive, it was not owned by Advance Capital ("Advance"), the proposed vendor, and it was encumbered with debt approximately equivalent to the appraised value.
Following further communications between Gilley and counsel for Greenwell, Gilley presented the Acquisition to the Exchange's Listings Committee on August 19. In a letter dated August 20 to Sobolewski Anfield, counsel for Greenwell, Don Gordon ("Gordon"), Manager of Policy and Planning for the Exchange, conveyed the Listings Committee's unanimous decision that the submission "be withdrawn from further review as the extent of the deficiencies that remain unresolved is so grave that it is impractical for further detailed comments to be issued by the Vancouver Stock Exchange." It was the Committee's opinion that Greenwell had failed to provide "full true and plain disclosure" of the Acquisition. Greenwell was instructed in the August 20 letter to immediately submit a news release disclosing that the Exchange had withdrawn the Acquisition and setting out Greenwell's plans to either proceed with or withdraw from the Acquisition. This decision is described as "the Initial VSE Position".
Gordon testified that it was the practice of Exchange personnel to phone when letters such as the August 20 letter were available for pick-up. He stated that Sobolewski - Anfield had offices two floors above the Exchange and had two pick-ups each day.
The price of Greenwell's common shares had remained close to $0.30 prior to March 1987. In March, when the annual meeting was held, there was a significant increase in volume and the price rose as high as $2.25. After increasing to $2.60 in May, it declined to $1.11 in June. However, by early August it had increased again to $2.80, dropping back to $2.40 when the Listings Committee held its meeting on August 19.
On August 21, by way of tickets time-stamped between 6:53 a.m. and 9:14 a.m., Baker sold 4,500 shares of Greenwell through his account at Levesque Beaubien Inc. at a price of $2.20 in four trades. According to Baker's August insider report filed with the Commission and dated September 15, these were the first shares he had sold since August 12 and were the last of some 7,500 shares he had owned at the end of July.
After the August 20 letter was issued, officers of Greenwell and Advance did not submit or issue the news release requested by the Exchange but instead contacted the Exchange to register their objection to the Initial VSE Position. As a result Gordon, who was then acting in the temporary capacity of Vice President, Listings, agreed to meet with Greenwell representatives to hear new information that he was told had become available.
* * *
The meeting took place during the afternoon of August 25 at the Exchange and was attended by Robert Palm of Advance, Alec Lenec, Baker and Irving from Greenwell and David Anfield of Sobolewski Anfield. Gordon was the only executive officer attending for the Exchange and was accompanied by a secretary to record the proceedings. At the meeting major problems were reviewed but no new information was presented, according to Gordon, who said a tense atmosphere developed and the Greenwell representatives threatened to delist Greenwell from the Exchange. Gordon then suggested an alternate approach which, if adopted, would permit the Exchange to give its approval. He suggested converting the deficiencies identified by the Exchange into risk factors to be included in the disclosure documents. This approach would have had the effect of reversing the decision of the Listings Committee but required the approval of the President of the Exchange. Gordon testified that he had said he would recommend this approach. The immediate response from those present, according to Gordon, was "an audible sigh of relief" and a reduction in tension. The effect of the August 25 meeting was to keep the file open and to breathe new life into the Acquisition. Gordon's alternate approach is described as "the Revised VSE Position."
* * *
On August 24 and 25, Greenwell's shares traded at prices between $2.21 and $2.50, closing at $2.30 on August 25. On August 26 the shares traded as high as $3.05 before trading was halted at 8:13 a.m. The last trade was at $2.95, an increase of $0.65 on the day, and 93,400 shares were traded during the short period before the stock was halted. This halt remained in effect until September 8.
One third of the trading on August 26 was accounted for by Baker and Irving. Levesque Beaubien Inc. entered a market buy order for Baker's account for 10,000 Greenwell shares at 6:25 a.m. The order was filled at prices between $2.40 and $2.60. At 6:58 a.m. West Coast Securities Ltd. entered a market buy order for Irving's account for 20,000 Greenwell shares. It was filled at prices ranging from $2.60 to $2.90. Baker reported the purchase of the 10,000 shares in his August insider report. Irving did not include his purchase of 20,000 shares in his August insider report filed September 23, nor in the September report filed on October 28, nor the October report filed on November 16.
Gordon documented the Revised VSE Position in a letter dated August 27 to Sobolewski Anfield. Greenwell subsequently prepared a draft news release dated August 31, which incorporated the elements of the Revised VSE Position. This draft news release was never issued.
When Gordon consulted the President of the Exchange about the Greenwell matter, the President advised him that he was not prepared to accept Gordon's recommendation and that the decision of the Listings Committee should stand. On September 8, 1987 Greenwell issued a news release stating that it had made application to have its shares voluntarily delisted from the Exchange and that it intended to proceed with the Acquisition. Greenwell also said that it was making application to list its shares on the Alberta Stock Exchange.
Trading in Greenwell's shares resumed at the market open on September 8, following the issue of the news release. During the four days of trading which remained in the week, trading volume was higher than it had been since the week ending July 31, 1987 and the closing price was $2.43, a decline of $0.52 from the pre-halt price. The price declined further over the following two weeks and closed at $1.85 on September 25.
We have been asked to determine whether Baker and Irving have breached section 68(1) of the Act, which reads in part as follows:
"68(1) No person in a special relationship with a reporting issuer shall
(a) purchase or sell securities of the reporting issuer with knowledge of a material fact or material change in the affairs of the reporting issuer that he knows or ought reasonably to know has not been generally disclosed ..."
We must first determine whether Baker and Irving were in a special relationship with Greenwell.
Section 3(1) of the Act states:
"a person is in a special relationship with a reporting issuer where he ...
(b) is a director, officer or employee of
(i) the reporting issuer ..."
We find that Baker and Irving were in a special relationship with Greenwell, Baker as corporate secretary and Irving as a director.
We will next consider whether the Initial VSE Position was a material fact or material change and, if so, whether Baker contravened section 68(1) when he sold Greenwell securities on August 21. Material change and material fact are defined in section 1 of the Act as follows:
"material change" means, where used in relation to the affairs of an issuer, a change in the business, operations, assets or ownership of the issuer that would reasonably be expected to have a significant effect on the market price or value of any of the securities of the issuer and includes a decision to implement that change made by
(a) senior management of the issuer who believe that confirmation of the decision by the directors is probable, or
(b) the directors of the issuer;
"material fact" means, where used in relation to securities issued or proposed to be issued, a fact that significantly affects, or could be reasonably expected to significantly affect, the market price or value of those securities;
Mr. Tyzuk, counsel for the Superintendent, argued that the Initial VSE Position was a material change. Greenwell's listing agreement with the Exchange requires, in paragraph 6:
"That the Company shall give to the Exchange prompt notice of each proposed material change in the general character or nature or organization of its business, property or affairs, and, without limiting the generality of the foregoing, this shall include:
(c) every proposed acquisition or disposition (by one transaction or a series of transactions) of real or personal property at (i) a cost or for a price exceeding $50,000 where the cost or price requires payment in shares ...
The Company shall not proceed with any of the foregoing transactions without the prior acceptance of the Exchange."
The Acquisition certainly required Greenwell to give notice to the Exchange and it did so. Mr. Tyzuk submitted that the Exchange's acceptance or rejection of the Acquisition would affect the assets, operations, business or perhaps the ownership of the issuer and would reasonably be expected to have a significant effect on the market price of Greenwell's shares.
Mr. Tyzuk further submitted that the price of Greenwell's shares, since it began climbing from $0.30 in February to the $2.20 level prevailing in August, had become primarily a function of investor expectations of Greenwell's prospects after the Exchange's approval of the Acquisition. He argued that a rejection of the Acquisition would reasonably be expected to have a significant effect on price.
Mr. Garrod, counsel for Irving, argued that the Initial VSE Position was neither an acceptance nor a rejection of the Acquisition, since the Exchange simply requested Greenwell to withdraw its submission, nor was it a withdrawal on the part of the Exchange. We disagree, and find the meaning of the Exchange's letter of August 20 to be quite clear: "...it was unanimously decided... that the Company's submission be withdrawn from further review..." Although the wording does not accord with that used in Greenwell's listing agreement, which requires that Greenwell shall not proceed with a transaction of this type without the prior acceptance of the Exchange, the Initial VSE Position was clearly a decision not to accept the Acquisition.
Mr. Garrod further argued that the Initial VSE Position was not a material change since it did not result in the issuance of an Exchange notice nor did the Exchange halt trading in Greenwell's shares. No evidence was placed before us that an event such as the Exchange's decision to withdraw the Acquisition from review requires a notice to members. The Exchange's position on halting trading is set out in Greenwell's listing agreement in paragraph 12, which states that at any time and without notice the Exchange may suspend or halt trading in Greenwell's shares. It is evident that the Exchange chose not to exercise its discretion in this case and instead elected to order Greenwell to issue a news release. We do not consider the fact that the Exchange did not issue a notice or halt trading relevant to whether the Initial VSE Position was a material change in the affairs of Greenwell.
The Initial VSE Position was a decision of the Exchange to deny the required regulatory approval for a proposed transaction that was the major business interest of Greenwell. There can be no doubt that the Initial VSE position was a change in the business, operations and assets of Greenwell that would reasonably have been expected to have a significant effect on the market price of Greenwell's securities. We therefore find that the Initial VSE Position was a material change in the affairs of Greenwell.
The Initial VSE Position was communicated to Greenwell's solicitors, Sobolewski Anfield, by a letter dated August 20. By normal practice, the Exchange telephones to advise that such letters are available for pick up by the solicitors. Sobolewski Anfield has offices in the Exchange Tower and normally makes two pick-ups per day. On the morning of August 21, Baker sold all of his remaining shares of Greenwell.
Based on this evidence, we find, on a balance of probabilities that Sobolewski Anfield received the August 20 letter on August 20, that Baker learned of the Initial VSE Position from Sobolewski Anfield on August 20 and that Baker knew, or ought reasonably to have known, that the Initial VSE Position had not been generally disclosed.
We therefore find that, in selling Greenwell shares on the morning of August 21, while he was in a special relationship with Greenwell, Baker breached section 68(1).
Next, we will consider whether Baker and Irving breached section 68(1) when they purchased Greenwell shares on August 26.
The Revised VSE Position was developed by Gordon during the August 25 meeting to provide an alternative approach for dealing with the concerns raised by the Listings Committee. Unlike the Initial VSE Position it was not a decision of the Exchange. To become a decision, it would require the approval of the President of the Exchange.
The importance and potential impact of the Revised VSE Position is clear. Had it been subsequently approved as an Exchange decision it would have allowed Greenwell to proceed with the Acquisition, its major business interest, and would undoubtedly have had a significant effect on the price or value of Greenwell's shares. It is also important to note that Gordon's intention to recommend the Revised VSE Position to the appropriate levels of authority at the Exchange was perceived very positively by those attending the August 25 meeting. We have Gordon's evidence that there was a relaxation of the tension that had been present when the meeting began and a general air of relief. It was evident that the company representatives, Baker and Irving among them, perceived it to be a reversal of their misfortune or, as Gordon put it, as breathing new life into the Acquisition. That the Greenwell representatives saw it as a credible proposal is further evidenced by the draft news release which they proceeded to prepare. This was dated August 31 and contained full disclosure of the matters which Gordon had proposed should be dealt with as risk factors.
Gordon's decision to recommend the Revised VSE Position is critical to our determination. Even though the Revised VSE Position could not be implemented without further approval, the fact that it would be recommended by Gordon, a senior official of the Exchange, would undoubtedly be perceived by the market as a positive development in the attempt to get approval for the Acquisition. It was therefore a fact that could reasonably be expected to significantly affect the market price or value of Greenwell's shares. Accordingly, we find that Gordon's decision to recommend the Revised VSE Position, was a material fact in the affairs of Greenwell.
That Baker and Irving had knowledge of Gordon's decision there can be no doubt. They were in the room and it was the focus of the meeting. Nor can there be any doubt that they knew it had not been generally disclosed when they purchased Greenwell shares during the first hour of trading the very next day.
We therefore find that Baker and Irving, while in a special relationship with Greenwell, purchased its securities with knowledge of a material fact in the affairs of Greenwell which they knew had not been generally disclosed. As a result they breached section 68(1) on August 26.
The Superintendent of Brokers has requested that the Commission issue an order under section 145 of the Act to remove the trading exemptions of Baker and Irving for a period of between two and five years. The Superintendent has also requested that Baker and Irving be removed as officers and directors of all issuers and be prohibited from so acting for a similar period by way of an order under section 145.1 of the Act. In addition the Superintendent sought an order for costs under section 154.2 of the Act.
Counsel for the respondents argued against the imposition of orders under section 145.1 and 154.2 on the ground that the sections came into force after the events that were the subject of the hearing and after the original notice of hearing and, therefore, that the requested orders would be retrospective in effect. The Commission has previously addressed this question in a decision in the matter of Marathon Minerals et al. (British Columbia Securities Commission, Weekly Summary, March 17, 1989, pages 24 to 26). The panel in that hearing decided in similar circumstances to impose orders under section 145.1 on the basis that the purpose of such orders is to protect the public interest, not to penalize past actions. The panel did not impose orders under section 154.2, because it determined that such orders would be unfair in view of the fact that the hearing began before the enactment and coming into force of the new section. There is no such concern in this case, as the hearing began after the amendments came into force and the amended notice of hearing stated that orders would be sought under sections 145.1 and 154.2.
Section 68(1) is one of the key provisions of the Act. It is intended to make the market operate more fairly by prohibiting trading in securities by certain persons having possession of certain information that has not been disclosed to the public. We have found that there were two breaches of section 68(1) by Baker and one by Irving. Although their trading did not involve large sums of money, the violation of this fundamental prohibition requires that the Commission make appropriate orders to protect the public interest in a fair trading market. These orders should serve as a clear message to other participants in the marketplace about the activities the legislation is intended to prevent.
We order, under section 145(1), that the exemptions described in sections 30 to 32, 55, 58, 81 and 82 of the Act do not apply for a period of two years from the date of this decision to Baker or Irving, provided that, for a period of 30 days from the date of this order, Baker or Irving may trade, through a registered dealer, securities that they hold at the date of this order, for the sole purpose of liquidating their holdings, and all such trades shall be reported to the Secretary of the Commission.
We order, under section 145.1(1), that Baker and Irving resign any positions that they hold as directors and officers of reporting issuers and that they are prohibited from becoming or acting as directors or officers of any reporting issuers for a period of two years from the date of this decision.
We order, under section 154.2, that Baker and Irving pay prescribed fees or charges for the costs of or related to the hearing, the amounts to be determined following further submissions by the parties to be made within thirty days of the date of this decision.
D.M. HYNDMAN, Chairman
E.L. LIEN, Member
J.P.H. McCALL, Member
[NOTE: The website link (provided immediately above) has been ‘erased’ by the British Columbia Securities Commission website. Hence, the reason for providing a portion of its eighteen (18) pages, which is only obtainable in-full, if requested ‘in-person’ (as stated below).]
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BRITISH COLUMBIA SECURITIES COMMISSION (Canada)
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] by entering the URL (with the missing official government information) and search the 'approximate date' the URL provided that official information, and read it if available from historical 'internet archives', or obtain missing official information in-person from the 'Canadian government British Columbia Securities Commission archived records'.]