Replies to post #39778 on Pharm Control Ltd. (fka PMCL)

[Klinsmann]

Really looks like this compensation is going to happen!
My bank in Germany already contacted me to do the paperwork for me :)

[slob]

hey there PhillyPA65..i found this on another board[MGLG]...seems Irwin Boock and Stanton DeFreitas were in deep.




Billionaire Alex Shnaider has alleged that an ex-partner was part of a scheme to defraud him, inducing him to invest $50-million. (Fernando Morales/The Globe and Mail)

Shnaider keen on Russian oil venture, ex-partner testifies


JEFF GRAY - LAW REPORTER

TORONTO — The Globe and Mail


Published Tuesday, Apr. 02 2013, 7:00 PM EDT

Last updated Wednesday, Apr. 03 2013, 6:49 AM EDT







Toronto billionaire Alex Shnaider was so enthusiastic about an oil and gas venture proposed by former oil executive Michael Shtaif in 2005 that he wanted to invest $200-million, Mr. Shtaif told a courtroom on Tuesday.

Mr. Shtaif, a Canadian citizen of Russian origin who once worked as a senior official with Russian oil firms Yukos and TNK-BP, was in the witness box on Tuesday testifying in a tangled civil trial over his falling out with Mr. Shnaider.


Court showdown pits billionaire against ex-partners






In court documents, Mr. Shnaider has alleged that Mr. Shtaif was part of a scheme to defraud him, inducing him to invest $50-million with a promise of $70-million from other investors that never materialized. Mr. Shtaif denies the allegations. He alleges that Mr. Shnaider tried to push him out of the joint venture and bribed Russian police to investigate him for fraud, allegations Mr. Shnaider denies. The allegations have not been proven.

In a Toronto courtroom, Mr. Shtaif recounted the first meeting between the two men in November, 2005. They met at the Toronto offices of Mr. Shnaider’s company, Midland Resources Holding Ltd., with which the Russian-born Toronto-based billionaire made his fortune in the Eastern European steel business.

Mr. Shtaif told court that the pair hit it off, with “similar personalities” and “similar interests,” over a two-hour meeting. And he testified that Mr. Shndaider was very interested in Mr. Shtaif’s plan to use his expertise to ferret out undervalued oil fields in Russia.

“As they say in baseball, I pitched him a fastball and he reacted,” Mr. Shtaif told court, saying he declined Mr. Shnaider’s initial offer of a $200-million investment for a 80-per-cent stake in Mr. Shtaif’s venture, as he did not want one dominating shareholder.

They later agreed on a $50-million investment, for a 32-per-cent share, Mr. Shtaif said, although Mr. Shnaider would later try to “squeeze” a larger share, he said.

Mr. Shtaif said he was unaware at that time that a purported Toronto investor in his venture, who used the named John Howard, was allegedly a man named Irwin Boock, who according to court documents, has faced Ontario Securities Commission proceedings and criminal charges related to fraud. It was Mr. Boock who had provided the shell company, called Magellan Energy Ltd., to become the corporate vehicle for the joint venture.

But the company, it is alleged, turned out to be a fraudulently created “sham,” Mr. Shtaif said. Another associate of Mr. Boock, Magellan board member Stanton DeFreitas, was also allegedly secretly selling “illegal” shares in the company and failing to pass the proceeds onto Magellan, Mr. Shtaif testified. (Both Mr. Boock and Mr. DeFreitas were also named as defendants in Mr. Shnaider’s lawsuit.)

Mr. Shtaif told court that Mr. Shnaider ended up with 1.4 million “illegal shares” from Mr. DeFreitas, although the billionaire said the purchase was “inadvertent.” Mr. Shtaif denied that he received any of these shares.

Mr. Shtaif, after learning of the problems, initially sued Mr. Howard and others over the issue in the United States but then dropped the lawsuit “reluctantly,” he testified, in order to protect Mr. Shnaider from being accused publicly of being involved in the “illegal distribution” of shares.

“I think that there was a lot of backdoor dealings going on between Mr. Shnaider, Mr. DeFreitas, and whoever, that we as the board of Magellan knew nothing about,” Mr. Shtaif told court.

Mr. Shnaider “should not have received those shares and he knew and should have known better than that,” Mr. Shtaif said.

Mr. Shtaif denied that he intentionally misled Mr. Shnaider about the $70-million investment pledged by a company allegedly controlled by the man calling himself Mr. Howard, which never materialized.

He told the court that he relied on word from Mr. DeFreitas when he told Mr. Shnaider in an e-mail that the first $10-million instalment of the $70-million had been paid: “I never intentionally or meant to mislead anybody at any time.”

[slob]

Court showdown pits billionaire against ex-partners


JEFF GRAY - LAW REPORTER

The Globe and Mail


Published Monday, Apr. 01 2013, 7:00 PM EDT

Last updated Monday, Apr. 01 2013, 7:06 PM EDT

A former senior executive in the Russian oil industry facing off against Russian-Canadian billionaire Alex Shnaider over a joint venture gone bad takes the witness box in a Toronto courtroom on Tuesday, in a murky saga riddled with extraordinary allegations of fraud, bribery and kidnapping plots.

The man set to testify is Michael Shtaif, a Russian-Canadian businessman who according to court documents has held senior positions with the former Russian oil exploration companies TNK-BP and Yukos. He faces allegations from Mr. Shnaider that he and a group of co-defendants were part of a scheme to defraud the billionaire of millions.



But in a five-year no-holds-barred legal battle, Mr. Shtaif alleges in court filings that Mr. Shnaider or his associates tried to force him out of a oil and gas joint venture, had armed men seize a company’s Moscow offices, bribed Russian police to have him face “spurious” charges and even plotted to kidnap him. Mr. Shtaif alleges that the ordeal wrecked his reputation and forced him to flee Moscow for Calgary with his wife and young son.

Toronto-based Mr. Shnaider, 44, who denies all the allegations against him, made his fortune with his company Midland Resources Holdings Ltd., centred on the steel business in Eastern Europe. He has made his name by dabbling in Formula One racing, hanging out with former hockey stars and financing Toronto’s new Trump Tower, plucking the building’s $20-million penthouse for himself.

He is suing Mr. Shtaif and several other men, alleging they were behind an elaborate scheme to steal his $50-million investment – a scheme that allegedly involved fraudulently incorporated companies and an accomplice convicted of two murders in Russia. Mr. Shtaif and his co-defendants deny the allegations.

Both sides accuse each other of making false allegations in court filings and leaking them to the media, in order to smear or pressure the other side. Both sides have demanded hundreds of millions in damages. The allegations have not been proven.

The soft-spoken Mr. Shnaider, who has lived in Toronto since moving here with his parents at age 13, was in court in recent weeks as his lawyers testified. He testified himself earlier this year in the trial, which began in February and is expected to continue for months.

The story behind the tangled allegations over his falling out with Mr. Shtaif dates back to 2005, when the two men agreed to set up a joint venture to acquire undervalued oil and gas properties in Russia. According to court documents, it later emerged that Mr. Shtaif’s company, Magellan Energy Ltd., was a “sham,” set up by a Toronto man with multiple aliases and previous convictions for fraud and other offences as well as fines and penalties from the Ontario Securities Commission. Mr. Shtaif says he was not involved in Magellan’s allegedly fraudulent origins.

Mr. Shnaider, who alleges he was first induced to invest by the promise of $70-million from other partners that never materialized, then agreed to set up a new company with Mr. Shtaif and other businessmen to take over Magellan’s business.

Even more would soon go wrong between the two men. Mr. Shnaider alleges that Mr. Shtaif colluded with a convicted Russian murderer in a complex sequence of events involving an attempt to purchase an interest in a Russian oil property. According to court filings, about half of a batch of promissory notes worth $12-million (U.S.) and held in safety deposit boxes in a Russian bank as an advanced payment – apparently a common feature in Russian business deals – allegedly ended up missing.

It was this allegation that Mr. Shnaider and his lawyers say prompted them to go to the Russian police about Mr. Shtaif. But Mr. Shtaif, in his testimony this week, is expected to reiterate the case spelled out in court documents that he, too, is a victim of fraud.

In the Ontario Superior Court last week, Mr. Shtaif’s lawyer, Colin Stevenson, was stopped by Madam Justice Mary Sanderson from asserting in a question to a witness that Mr. Shnaider had paid $525,000 to police to prompt them to seize some of the missing promissory notes. Mr. Shnaider’s lawyers say in court documents that the money went to private “forensic consultants” to prompt police to act more quickly, and was not a bribe.

“There’s obviously a huge controversy over what that payment was,” the judge said.

Mr. Shnaider’s former Toronto lawyer on the case, John Keefe of Goodmans LLP, was in the witness box last week. He testified under cross-examination that he did not believe that Mr. Shtaif faced any threats in Russia, but acknowledged he did not have any evidence for his doubt.