‘Cash for Canover’ withdrawal reviewed
Three checks totaling more than CI$1.5 million were delivered to the offices of former local financial services company Admiral Administration by Health Services Authority staff members between August 2011 and May 2012, jurors in the criminal trial of businessman Canover Watson heard Friday.
The checks, made out to a local company, AIS (Advanced Integrated Systems) Cayman Ltd. were related to various payments made for the implementation of the public hospital’s CarePay patient swipe-card contract. Watson, who was chairman of the HSA board of directors at the time, was also the global managing director of Admiral Administration at the time the checks were delivered there by HSA staff.
According to court testimony, the three checks were signed for by Watson’s former personal assistant at Admiral, Miriam Rodriguez, who is also charged and on trial in connection with the case. Both Watson and Rodriguez have pleaded not guilty to corruption-related charges against them that allege Watson directed the award of the AIS-CarePay contract from his position as HSA board chairman so that he and business associate Jeffrey Webb could ultimately skim profits from the deal.
Webb, who is also charged in the case, is not facing trial in Cayman at this time.
A statement Rodriguez made to police in 2014 indicated that she was instructed by Webb, not Watson, to sign for the checks and pass them on, either to Webb himself or to a woman who Rodriguez said she assumed worked at AIS Cayman. Rodriguez’s statement – which was read at trial along with the transcript of her police interview – indicated she did this as a favor to Webb, whom she had known for years, and that Watson had generally instructed her to assist Webb with business matters that arose from time to time.
Written answers to police questions provided by Watson, which were also read at trial Friday, gave a similar account.
Prosecutors have alleged that Webb and Watson controlled AIS Cayman Ltd. – which received around US$3 million from the CarePay swipe-card contract – through the use of what the Crown called “sham” company directors.
Prosecutors also read in testimony Friday from statements Rodriguez made to police that indicated Watson’s signature was stamped on the cover letter of the company registration form filed for AIS Cayman on Oct. 6, 2010. Rodriguez said this was a “mistake” and that the register had been corrected to put another signature, that of Caymanian auto parts store bookkeeper Joscelyn Morgan in its place. Watson was not listed as a director of AIS Cayman Ltd. on the original registration documents, prosecutors confirmed.
The CI$100 check paid to the Cayman Islands Registrar of Companies for that amendment to the initial register was also signed by Watson. However, Rodriguez told police she also may have erred in that case, simply using a signature stamp for Watson that she kept in her desk at Admiral Administration. Watson’s police statement also indicated Rodriguez appeared to have used a standard “template” when she filed for the AIS company registration and inadvertently left his signature on the documents.
Rodriguez told police that Webb asked her to assist with registering AIS Cayman Ltd. in October 2010, about two months before the government awarded a five-year, US$13 million contract to the company and its Jamaican partners for the implementation of the CarePay system. AIS Cayman Ltd. filed for registration the same day as a request for proposals went out for bids on the hospital contract, prosecutors said.
At the time Rodriguez was interviewed, in September 2014, she was considered a “significant witness” in the case against Watson and Webb. She ended up being arrested in November 2014 and was charged in the case early in 2015.
She now faces one count in the indictment filed by prosecutors alleging she transferred criminal property, namely the proceeds of the AIS Cayman Ltd. earnings.
The first check delivered to Admiral, for US$1.2 million, was issued on Aug. 30, 2011 and taken to the company’s offices by HSA staffer Angelee Beersingh. Prosecutors said the check was given to Rodriguez, who signed for it, and passed it on to a woman named Karen Barnett who Rodriguez believed to be an employee of AIS Cayman.
Rodriguez was asked during her police interview whether “this was just a favor you were doing for Mr. Webb?”
“Yes,” she replied. “It had nothing to do with Admiral.”
It was later revealed during the police interview with Watson that Karen Barnett, in addition to working at AIS Cayman, worked for Watson at another of his companies, CRW Trade Services, which Watson part-owned through a holding company called CRW holdings. Ms. Barnett also was identified as an employee of Fast Signs, another company Watson part-owned.
The US$1.2 million was identified by prosecutors earlier in the case as being the first payment for the proposed expansion of the CarePay swipe-card system to private sector insurers and healthcare service providers. That expansion never happened. The Crown alleged some money from this payment went to pay off part of a home loan for Webb’s personal property in Loganville, Georgia and to pay for Watson’s US$80,000 home entertainment system at his own suburban Atlanta home located next door to Webb’s.
The second AIS check, for US$147,500, was issued on Nov. 3, 2011, brought to Admiral the next day and collected by Rodriguez, who signed for it. Rodriguez told police she could not remember precisely, but that she either gave that check to Webb or Ms. Barnett.
The third check, for CI$502,000 (approx. US$600,000), was issued on May 25, 2012 and taken to Admiral on May 28, 2012 where it was again signed for and passed either to Webb or Ms. Barnett, according to trial testimony. This check is believed to have been paid, again, for the non-existent expansion of the CarePay card system to Cayman’s private sector healthcare industry.
Regarding this payment, prosecutors produced an email sent from Watson in which he asked Angelee Beersingh to pick up the check from the appropriate government office. Watson instructed her that, if the check had been made out to the Health Services Authority, she should take it to Heather Boothe, the HSA’s chief financial officer who could make out a separate check to AIS Cayman Ltd. If it was already made out to AIS, she was instructed to take it to Rodriguez at Admiral’s offices in downtown George Town.
During his interview with police, Watson was asked what business he had in asking Ms. Beersingh, an HSA employee, to deliver checks to his personal assistant at Admiral.
Mr. Watson replied that he was aware Rodriguez would see both Ms. Beersingh and Ms. Barnett that day (Nov. 4, 2011) and that he wanted to “smooth along the process” with the implementation of the CarePay swipe-card system.
“I was simply trying to be helpful,” Mr. Watson is quoted as saying at the police interview.
Police alleged that Watson was simply not telling the truth and that he personally benefitted from the AIS Cayman Ltd. contract to the tune of nearly US$350,000. Watson denied those allegations throughout the interview.
‘Cash for Canover
Police investigators and Crown prosecutors also looked at certain cash withdrawals made from the AIS Cayman Ltd. bank account at Fidelity Bank since it was opened on Dec. 23, 2010. They focused on a total of US$69,000 withdrawn from the account during the period it operated.
Some US$15,000 of that was taken out with Watson’s signature on the withdrawal slip. Watson said Webb asked him to make that withdrawal for him so that Webb could make payroll expenses in a construction company he owned.
Another US$4,000 – in 40 $100 bills – was withdrawn for what prosecutors said was the listed reason of “cash for Canover.”
Watson said this money was withdrawn by Webb to pay him back for some money Watson had given Webb during a trip the two were on while representing FIFA, world football’s governing body.
Several additional sums were withdrawn from the account, according to police, to pay a company called CRW Trade Services – a company Watson had a part ownership interest in through another firm, CRW Holdings.
Watson told police AIS Cayman hired CRW Trade Services to clear various goods from Cayman customs as needed. Watson said he was not aware CRW had been hired by AIS to perform this service.
“That’s your company,” police investigator Anthony Hill stated, referring to CRW.
“I did not benefit from this contract,” Watson said later in the interview. “I categorically deny AIS is my business.”
A three-day delay in Watson and Rodriguez’s criminal trial last week was resolved on Friday, with an ill juror having recovered and an issue that arose over potential new evidence in the case having been dealt with. Grand Court Justice Michael Mettyear indicated that jurors would be getting additional information that had been taken from two of the seven USB memory sticks, often called “jump drives,” that were reviewed at Watson’s Admiral Administration office following his arrest in August 2014. Defense attorneys feared those drives had been lost, but the information on them was recovered last week.
It was understood that Watson and his local attorney Ben Tonner, who were not at trial Friday, spent the day reviewing further information from the jump drives, to see if it might have any impact on the case. Lead counsel for the defense, Trevor Burke, QC, did attend Friday’s proceedings.
Judge Mettyear said Crown prosecutors would be referring to some of the new information obtained from the drives but that prosecutors “would not be allowed to reopen the case” based on this evidence. He also cautioned that there was “nothing sinister” about Watson’s absence from the trial proceedings on Friday.
It was thought Friday that Watson’s defense might begin its opening trial statements by Tuesday afternoon.