CarePay trial: Canover Watson guilty on 5 criminal charges

Not guilty on 6th charge, money laundering

Canover Watson is led from court after being convicted in February on five of the six criminal charges against him.

A Cayman Islands Grand Court jury found Canover Watson guilty Thursday on five of the six criminal charges against him, following a two-month trial.

The unanimous verdict of the seven-person jury was reached in two stages Thursday afternoon, with jurors first finding Watson guilty of four charges around 2:30 p.m., then resuming deliberations and pronouncing their verdict on the other two charges around 4 p.m.

The five counts on which Watson, 45, was found guilty included two charges of conspiracy to defraud, one charge of fraud on the government, one charge of conflict of interest and one charge of breach of trust by a public official.

The lone not guilty verdict was reached on charges of transferring criminal property [money laundering].

Watson was remanded in custody following the announcement of the final verdict Thursday afternoon. He was placed in handcuffs and led from the courtroom by Royal Cayman Islands Police officers, then taken across the street to the main court house.

Grand Court Justice Michael Mettyear scheduled sentencing in the case for 10:30 a.m. Friday.

Following the announcement of the initial guilty verdict on four of the six charges, Watson looked surprised, then put his head in his hands and later went over to speak with his 74-year-old father, who has been present for nearly every day of the trial.

Watson’s local counsel Ben Tonner said following the verdict that attorneys would have to consider whether they would file an appeal. He said Watson would be remanded at Northward Prison overnight prior to his sentencing Friday.

Both Justice Mettyear and Deputy Director of Public Prosecutions Patrick Moran praised the work of the Cayman Islands Anti-Corruption Unit, which had been investigating the case against Watson for years prior to his arrest in August 2014. Two officers in particular, Inspector Richard Oliver and Sergeant Anthony Hill, were singled out for their hard work in the investigation.

“I congratulate the ACU on their fine work on this case,” Justice Mettyear said.

Watson was accused, along with his business partner and friend Jeffrey Webb, of orchestrating a scheme that skimmed hundreds of thousands of dollars from the Cayman Islands public hospital system’s CarePay patient swipe-card contract. It was a scheme which prosecutors said Watson directed as the former chairman of the Health Services Authority Board.

Webb still faces charges in the CarePay case, but was unable to attend trial in Cayman with Watson following his guilty plea in the U.S. in connection with the FIFA racketeering and bribery probe.

Unusual verdict

An unusual set of circumstances occurred in the court just prior to the jury’s announcement of a partial verdict in the case.

Initially, jurors were called in by Justice Mettyear around 2:15 p.m. Thursday and asked if they had reached a verdict on any of the counts in the indictment against Watson.

The jury forewoman did not immediately respond to the judge’s question, which he took as an indication that the jurors had not yet reached a verdict.

He then proceeded to inform jurors that they could reach a verdict by a minimum 5-2 majority vote, if necessary, rather than by a unanimous 7-0 vote on any of the counts.

After a short break, the jury was called back into the courtroom. This time, Justice Mettyear asked whether they had reached a decision on any of the counts. The forewoman indicated they had reached a verdict on four of them.

Justice Mettyear then asked the jury to give its verdicts on the four charges. The forewoman indicated a unanimous guilty verdict on all four.

Remaining undecided on the other two counts, the jury went back into the deliberation room for about another hour before reaching their final verdict around 4 p.m.

During that time, Watson was not allowed to leave the building.

The charges

For the first two counts of the indictment against Watson, the Crown had to prove there was a conspiracy involving dishonest acts and that the defendant was involved.

In the first count, the Crown had to prove that the CarePay system’s local contractor, AIS (Advanced Integrated Systems) Cayman Ltd., had been formed in a way to disguise the involvement of Watson and Webb, and that the two had “adjusted” the cost proposal for the contract upward in late 2010. The charge also alleges they provided bogus records to Fidelity Bank to set up the AIS Cayman account.

The second charge required the Crown to prove Watson and Webb doctored a contract and misled the government into approving funds for a US$2.4 million expansion of the CarePay system to private sector healthcare providers. That proposed expansion never happened.

The third count in the indictment alleged Watson failed to disclose that he had a personal interest, or that the company he and Webb owned, The W Group, had an interest in the decision of the Health Services Authority board to award the CarePay contract to AIS Cayman and its Jamaican partners.

Count 4 of the criminal indictment alleged fraud on the government by Watson as a result of the conspiracy to defraud entered into by himself, Webb and others.

Initially, Watson was accused of taking about US$348,000 in what amounted to kickbacks from the CarePay scheme he allegedly directed. Later in the trial, as more evidence emerged from portable USB computer drives found at Watson’s former place of employment, that amount rose to more than US$417,000.

The fifth count of the indictment, upon which the lone not guilty verdict was delivered, was for alleged money laundering activities in connection with the transfer of proceeds from the CarePay contract scheme.

The sixth count alleged multiple breaches of trust by Watson, a public official, during his tenure as chairman of the Health Services Authority between 2010 and 2013.