Should we ask?

By G.A. Dwyer Astaphan

In a bne article dated 19th April, 2010, and captioned “Corruption remains a burning issue in Slovakia”, Jiri Kominek wrote:

“Slovak government sources confirm to bne that, in late 2009, US and Swiss investigators flew to Bratislavia to brief Slovak government officials about their findings concerning the true ownership structure and offshore bank details of individuals behind a company called Interblue Group, whom they suspect of being involved in money laundering activities via the US, Switzerland, The Federation of St.Kitts & Nevis, and possibly other locations”.

Interblue, then registered to a garage in the town of Snohomish, Washington, USA, had benefited from a sweetheart deal in which the Slovakian Ministry of Environment had sold Interblue 15 million tonnes of carbon emission credits for Euros 5.05 per tonne, when neighbouring countries were selling credits for E 10-13 per tonne, causing the government to lose at least E75 million in revenue.

As a result, three Ministers of Environment were fired.

It is believed that from the fruits of that sweetheart deal, the people behind Interblue would help finance the campaigns of their political friends in Slovakia.

In addition, it seems that the Interblue folks were also involved in a number of frauds related to the rigging of public tenders as well as to funds intended for Slovakian infrastructural projects, worth billions of Euros.

In mid-2009, with the FBI involved in the investigation, Interblue shut down its garage operation in the USA and relocated to Switzerland under the name, ‘Interblue Group Europe’.

By this time the FBI and their Swiss counterparts knew the ownership structure and offshore bank details of Interblue, whose owners were believed to have close links with certain Slovak government officials and with Russian organized crime.

The investigators also believed that the Interblue owners were “linked to a web of companies registered in Slovakia and the Czech Republic, which, in turn, are domiciled to offshore locations ranging from the USA, South Pacific, Cyprus, the Netherlands and the Caribbean island of St.Kitts, to name a few”.

“This would not be the first time that Slovak companies have been implicated in crooked offshore schemes linked to Caribbean islands”, wrote Kominek.

He continued: “The UK suspended self-government and imposed direct rule over the British Overseas Territory of Turks & Caicos in August,2009, following a lengthy investigation that revealed long-term systemic corruption on the part of the island group’s democratically elected government. At the heart of the scandal lay a financial relationship between the former (Chief Minister) of the Turks & Caicos Islands, Michael Misick, and Slovak investment firms J &T and Istrokapital,  planning to construct a E400 million luxury resort…They were using the island territory as a private bank, de facto purchasing the government to do their bidding”.

Further, Kominek wrote: “With the Turks & Caicos losing its appeal as a destination for offshore money when the UK took over, another Caribbean island appears to be trying to take its place in the sun”.

He went on: “On November 24th, Denzil Douglas, the prime minster of St. Kitts flew to Slovakia and discussed with local officials the possibility of opening an embassy in Bratislavia (its capital). Mr. Douglas was accompanied by Christian Kalin and Wendell Lawrence…”

“Messrs. Kalin and Lawrence work for the Jersey-based Henley & Partners, which specializes in arranging offshore trusts and citizenship-through- investment schemes. Kalin works in the Zurich office, while Lawrence represents Henley & Partners in the St. Kitts capital of Basseterre. Kalin confirms to bne that his company was hired by the government of St.Kitts to assist them in diplomatic law matters in Slovakia and maintaining offices in Bratislavia”.

Mr. Kominek’s article raises a number of questions.

Should we ask them? Of course. Indeed, the question ought to be: How can we  not ask them?

Please be clear. Asking these questions does not in any way mean that I am accusing anyone of wrongdoing, or seeking to embarrass, disrespect or defame anyone. I have absolutely no desire or intention to do any such thing. It simply means that there are questions which  the people of this country may wish to ask, and which they have the right and  responsibility to ask, as they seek to protect and enhance their best interests and the good name of St. Kitts & Nevis by pressing for good governance and transparency, and by striving to strengthen their democracy.

Whether those in positions of accountability are willing to give answers is another matter.

Here are 21 questions:

1. Is it true that Prime Minister Douglas did in fact go to Slovakia as reported by Mr. Kominek?
2. If so, what are the objectives in opening an embassy in Slovakia?
3. What are the benefits, costs and risks?
4. Could this be another potential ‘external shock’ waiting to happen?
5. Is it true that Russian organized crime has a strong presence in Slovakia and certain other former Eastern bloc and Central European countries? If so, might that constitute a ‘no-no’ from the start, given the influence that Russian organized crime might have over top Slovakian government decision makers?
6. Is it reasonable to assume that the Americans, the British, the Canadians and others will have followed with interest the activities of the PM and his delegation while in Slovakia?
7. What expertise does the firm of Henley & Partners ( H & P) have in “diplomatic law matters”?
8. Does Mr. Christopher Kalin have a St. Kitts & Nevis passport? If so, is it a diplomatic passport? If it is, what diplomatic duties does he perform for St.Kitts & Nevis?
9. Regarding diplomatic matters, can the people of St. Kitts & Nevis get the list of all St. Kitts & Nevis diplomats and consuls, their terms of reference, and an indication as to whether any of them has been or is under investigation for fraud or any other crime involving dishonesty?
10. In what capacity did Mr. Wendell Lawrence travel to Slovakia? Was it as the Adviser to the Minister of Finance, was it as a diplomat of St. Kitts & Nevis, was it as an official of Henley & Partners, was it in his capacity as a private investment consultant and registered agent under the Financial Services Regulations, or was it in any two or more, or even all, of the above capacities? And who paid for his trip?
11. While we are on Henley & Partners, does the Government pay the rent for the building which that firm occupies at the corner of Central and New Streets in Basseterre, as well as the staff salaries, payroll contributions, utilities, and so on?
12.  There is a Henley & Partners sign on a building at the top of Church Street. Does H & P also operate there?
13. The H & P website also points to an office at Solomon’s Arcade in Charlestown, Nevis, but it gives a St. Kitts telephone number and it names a contact person who lives and works in St. Kitts, not in Nevis. Is that a mistake?
14. Why was H & P given a five-year worldwide exclusive contract to administer/mamage/market the Sugar Industry Diversification Program (SIDF)? Was that in the best interests of the people of this country?
15. Is it true that even if someone else brings a client to the SIDF program, H & P still collects a fee equivalent to 10% of the sum paid for citizenship, taken from the funds paid to acquire the St. Kitts & Nevis citizenship? And a fee of twice that if they do bring a client in?
16. If so, doesn’t that unnecessarily deplete the SIDF funds? So how much does Government actually net from each SIDF application? For example, if the fee to Government is US$200,000.00, how much does Government net out of that after H & P gets its share?
17. Might there be a conflict of interest, real or potential, and/or a risk of insider trading, with Mr. Lawrence being an ambassador for St. Kitts & Nevis, as well as being the Adviser to the Minister of Finance, an official of H & P, and also a private investment consultant who brings clients into the SIDF program and otherwise into the economy?
18.  Did H & P have anything to do with funding the ‘It’s Working’ campaign leading up to the last general elections? If so, might they have done so from commissions and fees earned through the SIDF program?
19. Did H & P pay the British consultants who were engaged in relation to the recent election campaign? And if so, was it for the sum of US$2 million?
20. Was money paid by SIDF citizenship applicants which could have gone  directly to benefit the people of this country as a whole (for example, to buy vitally needed equipment for the hospital, to build a new police station, to reduce crime, or otherwise assist the people of this country) therefore spent elsewhere instead?
21. Was the trip to Slovakia in any way related to the recent elections?