A jury has found Canover Watson guilty on all counts in a fraud trial that accused him of sending false invoices for US$1.54 million to regional football confederation CONCACAF and then laundering the stolen funds.
His co-accused Bruce Blake was found guilty of two counts of false accounting but cleared of money laundering. Both men were senior officials at the Cayman Islands Football Association at the time the offences took place in 2013 and 2014.
Watson sent US$600,000 of the proceeds from the invoices for football equipment that was never delivered to the football association. The money was used to pay down a bank loan that he and Jeffrey Webb, the CIFA and CONCACAF president at the time, personally guaranteed.
Watson and fellow CIFA and CONCACAF football executive Bruce Blake were found guilty of false accounting charges in relation to two fake loans agreement used to explain two large US$600,000 payments to CIFA’s auditors.
However, Blake was found not guilty of money laundering-related charges.
The jury returned its verdict on the second day of deliberations after a 12-week trial that began on 8 August.
Watson syphoned money from CONCACAF
The Crown accused Watson of syphoning money from CONCACAF, run by his close associate and friend Webb, with invoices that were waved through by the organisation’s general secretary Enrique Sanz.
Watson sent the invoices from a Panama company, Forward Sports International Management Inc, that had a similar name to Pakistan-based football manufacturer Forward Sports (PVT) Ltd.
CONCACAF had an existing business relationship with the sports equipment maker in Pakistan because Watson had established a separate distribution company, Forward Sports Inc., in Panama, together with Shakeel Khawaja, a sales representative for the company, with the aim of promoting the brand within the Caribbean and Central American region.
During the trial Khawaja testified that he had no knowledge of the false invoices, related production orders or the $1.54 million received by the company that Watson alone controlled through an anonymous Panama foundation called Green Day.
CONCACAF officials testified they were unable to track down any of the goods purportedly ordered by the three invoices.
Watson used some of the embezzled money to pay off his personal American Express credit card bills.
About $300,000 were used to buy genuine sports equipment from Forward Sports, the Crown said, after CONCACAF officials raised questions about the whereabouts of the items supposedly ordered through the three fake invoices.
Watson sent further payments of $200,000 and $300,000 to an account belonging to Blake’s consulting business. However, they were flagged by Cayman National Bank and returned because the amounts were inconsistent with the usual money flows and stated business purpose of the account.
Blake then submitted invoices for sales commissions and legal and consulting fees to the bank to receive $140,000 from Watson’s Panama company. During the trial Blake’s defence team argued that he had done genuine work for Watson but had not known about Watson’s scheme or that the funds were criminal proceeds.
The jury found Blake not guilty of knowingly submitting false information to the bank to receive funds that he knew or should have known was stolen.
But Blake was found guilty of submitting two fake loan agreements for US$600,000 each he signed on behalf of CIFA.
The lenders in the agreements were two Panama companies – Forward Sports International Management Inc and Cartan international Management Inc – controlled by Watson.
According to the prosecution the agreements could have been also used by Watson to potentially recoup US$1.2 million from the football association later.
The scheme unravelled when CIFA’s audit firm Rankin Berkower contacted the genuine Forward Sports and Cartan companies and they were unable to confirm that the payments were loans.
The auditors subsequently reported the matter to the Anti-Corruption Commission.
Blake and Watson were released on bail pending a sentencing hearing scheduled for 19 Jan.
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