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Belize Firm Charged: $500 Million Tax-Evasion Plan

Posted By: Marty

Belize Firm Charged: $500 Million Tax-Evasion Plan - 09/09/14 09:19 PM

IPC Management Services LLC, a Belize-based investment firm, and its founder were accused of a $500 million scheme to launder money and hide investments as part of a U.S. crackdown on tax evasion.

Robert Bandfield, a U.S. citizen, was charged in an indictment unsealed today in Brooklyn federal court with conspiring to commit securities fraud, tax fraud and money laundering. Five other individuals and six companies are accused of taking part in the plan that involved as many as 100 U.S. clients, according to prosecutors.

The defendants “set up sham companies with figureheads at the helm in an attempt to deceive U.S. law enforcement and regulators and bragged about their scheme to their clients,” Brooklyn U.S. Attorney Loretta Lynch said in a statement today.

Unlike in many other countries, the U.S. taxes citizens on their worldwide income regardless of where they actually live. U.S. officials have been cracking down on possible tax sheltering in foreign accounts. Overseas payments have also become subject to new disclosure requirements.

Starting in January 2009, the group began “masquerading as financial professionals,” concocting inter-related schemes in which they used offshore companies to conceal clients’ ownership interests in U.S. companies, prosecutors said. The group also manipulated stock prices in those companies and helped the clients evade U.S. tax reporting requirements as well as launder proceeds, prosecutors said.

Bandfield was arrested today in Miami. The other defendants have residences in Belize, prosecutors said.

Titan International Securities Inc., Legacy Global Markets S.A. and Unicorn International Securities LLC were among the companies also charged.

The U.S. Securities and Exchange Commission filed a related lawsuit today.

The case is U.S. V. Bandfield et al, 14-cr-00476, U.S. District Court, Eastern District of New York (Brooklyn).

Bloomberg
Posted By: Marty

Re: Belize Firm Charged: $500 Million Tax-Evasion Plan - 09/12/14 11:22 AM

Remember CYNK? A New Report Says It Might Be Tied To A $US500 Million Money-Laundering Scheme


IntroBiz, the social media site tied to CYNK.

CYNK Technology — the (sort of) social media company that earlier this summer saw its market cap rocket up to more than $US6 billion in just a few days despite having no revenue, no assets, and one employee — may be a tied to a $US500 million money-laundering and stock-manipulation scheme, according to a report on Thursday by Bloomberg’s Zeke Faux.

Faux reports that this week, U.S. prosecutors brought charges against a group of men that worked on the same floor, of the same office building in Belize that Cynk listed as its address in regulatory filings.

Faux reports:

“U.S. prosecutors chasing an alleged $US500 million money-laundering and penny-stock manipulation scheme brought charges this week in federal court in Brooklyn, New York, against a group of men who worked on the same floor of a Belize office building that Cynk listed as its address.

While the U.S. case, stemming from a two-year undercover operation, doesn’t mention Cynk, documents obtained by Bloomberg News show that some of the defendants held millions of Cynk shares for clients in shell companies they helped create.”

Reporting by Business Insider back in July tied CYNK to a number of individuals over a number of years, including Javier Romero, who was most recently listed as CYNK’s CEO and lone employee.

However, Romero told Business Insider at the time: “According to records, one Javier Romero on June 18, 2014 resigned as President and Secretary and Director of CYNK Technologies, whereupon on Mr. Howard Berkowitz filled these vacancies. At this time, the stock was around $US2 per share.”

Trading in shares of CYNK was halted by the SEC after the bizarre rise in CYNK shares was widely reported, and through the summer the company lost nearly all of its value.

As of Thursday, shares appeared to be trading hands just a few times per day and were valued at around $US0.25.

Here’s a chart of the 2014 rise and fall of CYNK shares.


Businessweek

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