By the sixth day of his summing up to the jury in the Cash4Titles trial, Chief Justice Anthony Smellie had covered the evidence of 40 witnesses.
He has indicated his intention to complete the review of evidence by Friday. This would include the testimony of the defendants, Lewis Rowe and Patrick Tibbetts, who are charged with assisting Richard Homa and Michael Gause to retain the benefit of the proceeds of criminal conduct.
The Chief Justice said he did not intend to have jurors retire on Friday to consider their verdicts. Instead, after the holiday weekend, they will receive closing directions and retire on Tuesday morning.
Witnesses whose evidence was reviewed as of 18 January included Homa and Gause, both of whom are serving prison sentences in the US. Their testimony was extensively reported in the Caymanian Compass when they came to Cayman as prosecution witnesses last May/June.
Other witnesses included persons who worked for or with one of the defendants.
About 20 witnesses were persons who had invested money. Their evidence included whether they knew they were investing in C4T; their relationship with one or the other defendants; and documents pertaining to their investment.
Several witnesses said they did their investment by having a company set up in Cayman. In some cases, the company account was with Bank of Bermuda.
More than one witness said he was told by a Bank of Bermuda officer that the officer had himself invested in C4T.
Many witnesses spoke of getting a portion of their money back through the ‘Bank of Bermuda settlement’.
Giving evidence by video link from Guernsey, Mr. Kenneth Gibbs said he was the managing director of Bank of Bermuda in Cayman 2001 – 2002. During that time he was served with a production order and handed over to police bank records for companies connected with C4T.
Before that, around early November 1999, he was part of a large team brought in from outside to conduct an internal review at the bank. This was within a month of the arrest of Gause and Homa.
He said he reviewed the bank’s due diligence in relation to all C4T accounts. He commented that the bank’s due diligence was pretty much immaculate compared to other institutions at the time.
He also stated that all staff were trained to detect warning signs in relation to account activity. Such a signal would be payments being made which were inconsistent with the way the account should be operated.
If monies were going in a different direction from the norm, that might well ring alarm bells, so it was critical to be acquainted with the nature of the client’s business. It must be so in order to be alert to financial flows and transaction patterns, Mr. Gibbs said.
There was a suspicious activity report filed with the Financial Reporting Unit in relation to Gause and there were two internal memos relating to associates of Gause.
The Chief Justice detailed Mr. Gibbs’ evidence as being that, as of September 1998, it was quite clear the Bank of Bermuda was on notice that there was a possibility of suspicious conduct on the accounts of Gause, Homa and the related accounts, so suspicion should have attached to any related companies set up after September 1998. Those accounts should have been monitored on a transaction by transaction basis.
Mr. Gibbs had told the court he could not say that the accounts were so monitored, because he was not there at the time.
The conclusion of the review was that it was unlikely that the fraud on behalf of Gause could have been detected from the Cayman office of the Bank of Bermuda. Despite the monitoring and the suspicious activity report, it was unlikely that the bank could have spotted what was going on.
The review team also concluded that the transactions that did occur were in the clients’ names and in accordance with the clients’ mandates. Internal transfers were probably not consistent with what the account managers were told at the time the accounts were opened.
Mr. Gibbs said that C4T was a small part of the bank’s overall transactions and spread out over 18 months or so. To have picked up on them would have been very difficult.