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Site Updated | Friday, 28 April, 2000 | 12:05 PMHealines

Governmentmakes two new important appointments to service Financial Industry

Chief ExecutiveOfficer for Stock Exchange and Managing Director for MonetoryAuthority

Cayman Islands MonetaryAuthority New Managing Director

The Government and the CaymanIslands Monetary Authority (CIMA) are pleased to announce theappointment of Mr. John Bourbon as the new managing director ofthe Authority. Mr. Bourbon, 44, has an MSc in Financial ServicesRegulation and his professional affiliations include: Fellow ofthe Chartered Institute of Bankers, Associate of the ComplianceInstitute, Member of the Life Assurance Associationand Memberof the Management Development Association. His career includes23 years within the Barclays Group where he gained wide experiencewithin the financial services arena including private client portfoliomanagement, stockbroking and life insurance, pensions and investmentsales. In 1997 he moved to take up the post of Head of Supervisionwith the Isle of Man Financial Services Commission, where he hasspent the past three years.

Mr. Bourbon will assumehis new post with CIMA in early June, and will be joined by hiswife Wendy, a qualified teacher and their children Andrew, 19and Amy, 15.

Chief Executive Officer Stock Exchange

The Cayman Islands StockExchange (CSX) is pleased to announce the promotion of Valia Theodorakito chief executive officer (CEO), effective 1 May 2000. Ms. Theodoraki,who has an MSc in International Banking and Finance from Heriott-WattUniversity, joined the CSX as head of listings in September of1999. Prior to joining the CSX, her career included 10 years inthe listings and capital markets groups at the London Stock Exchange,and two years as assistant manager in the legal department newissues transaction management team of Tokyo-Mitsubishi Internationalplc. (London).

The CSX is also pleasedto announce the promotion of Ms. Elizabeth Denman to head of listings.Ms. Denman joined the CSX from the Toronto Stock Exchange in Februaryof this year as deputy head of listings.

In announcing the CEO appointment,the Chairman of the Exchange, Mr. Anthony Travers, said: "TheExchange is pleased to place emphasis on the existing qualificationsand experience of a proven team. The CSX will continue to manifestthe teamwork that enables us to deliver an informed, consistentand efficient service to our global clients."

Ms. Theodoraki said: "Iam delighted to take up the CEO role and I look forward to workingin co-operation with the staff of the Exchange, the Council andthe Cayman Islands Government to continue to strengthen the positionof the CSX as a first class international exchange."

Mr. Tony Travis who residesin England as a Senior Partner with the local law firm of Maplesand Caler remains as Chairman of the Board. The day to day affairsof the stock exchange will be managed by Ms. Theodoraki.


... from Cayman Net News Weekly Newspaper Liquidator vs. LiquidatorTwo of Cayman's largest Accounting firms - PriceWaterhouseCoopers and Ernst & Young battle over selection to oversee voluntary liquidation of assets of alleged Criminal Proceedings.

In a startling but not unexpected movethe Cayman Islands Government appears to have overtly co-operatedwith United States regulatory authorities in bringing about aresolution for alleged criminal conduct with criminal investigationsand trials pending.
Last week, a joint press release from theGovernment's Legal Department and the law firm Hunter & Hunter,stated that ExCo had appointed a controller over the affairs oftwo management companies, Everest Management Ltd. and Zephyr InternationalLtd.
Everest Management Ltd., a Caymanian ownedcorporate management company is the registered legal owner ofmany of the Caymanian companies that own the various bank accountswhere the possible illegal proceeds of C4T Management Ltd., aU.S. company currently in receivership, and investors' funds,estimated to be US$ 13 million, have been deposited. This company,as is typical of management companies, acts as the shareholdersand directors of the Caymanian companies it 'legally' owns.
The owner of Everest Management Ltd. is CaymanianMr. Patrick Tibbetts.
In November and December of 1999 seven companiesinvolved in the alleged Ponzi Scheme , three of which are ownedby the U.S. individuals whose assets are in Receivership underMr. Phillip Stenger, a US attorney, were placed under voluntaryliquidation. Messrs. Christopher Johnson and Nicholas Freelandof PriceWaterhouseCoopers were the voluntary liquidators. Subsequently,the Grand Court of the Cayman Islands ordered the liquidationunder court supervision.
It is important to note that Everest Management Ltd. is not inliquidation, voluntary or otherwise. It would appear, however,that the appointment of a controller would indicate that the Governmentintends to keep a watchful eye on the status of the
ExCo's action of appointing a controller for Everest ManagementLtd. is the first use of such powers under the newly passed pieceof legislation, the Companies Management Law 1999, section 16.The appointee is Mr. Jim Cleaver, the Managing Partner of Ernst& Young. The powers of the appointee are specified in theact and include: "Section 16 (1) he may - (i) revoke thelicence; (ii) impose conditions or further conditions, upon thelicense and may amend or revoke any such condition; (iii) requiredthe substitution of any director or senior officer of the licensee;(iv) at the expense of the licensee, appoint a person to advisethe licensee on the proper conduct of his affairs and to reportto the Authority thereon within 3 months of the date of his appointment;(v) at the expense of the licensee, appoint a person who shallbe known as the Governor in Council's appointed controller toassume the control of the licensee's affairs who shall, subjectto necessary modifications, have all the powers of a person undersection 18 of the Bankruptcy Law (1997 Revision); and (vi) requiresuch action to be taken by the licensee as he considers necessary."
Some of the bank accounts owned in the name of various Caymaniancompanies and managed by Everest Management Ltd., are 'beneficially'owned by one of the individuals whose assets are in Receivershipand being controlled by Mr. Stenger.
It would appear that Mr. Cleaver's appointment is a result ofhis position as one of the Joint Official Liquidators in the voluntaryliquidation in a total of sixteen local companies including: CombinedAsset Management, Harbour Management Ltd., Inter-World Holdings,International Professionals Ltd., ITL Corp., JIBO Corp., JMP International,KDS Holdings, Morning Star Ltd., MTN Investments, Offshore TitleInvestments, Opal Holdings, S & R Financial, Sovereign CapitalHoldings, Unique Projects, and White Sands International.
In seven of these companies Mr. Cleaver and Mr. Stenger replacedPriceWaterhouseCoopers' Mr. Christopher Johnson and Mr. NicholasFreeland. The companies for which Mr. Johnson and Mr. Freelandwere removed as Joint Official Liquidators are: Combined AssetManagement, Inter-World Holdings, International ProfessionalsLtd., JIBO Ltd., JMP International, Morning Star Ltd., and OpalHoldings.
The other Court appointed Joint Official Liquidator is Mr. PhillipStenger of Grand Rapids, Michigan. Mr. Stenger is a partner ofthe law firm Stenger & Stenger and reportedly has extensiveexperience in dealing with recovery of assets for investors whohave been defrauded by ponzi schemes. He is also the U.S. courtordered Receiver for assets for two U.S. individuals, MichaelGause and Richard Homa, and their companies including those ofa company called C4T Management Inc. ('Cash 4 Titles').
According to the SEC (Securities and Exchange Commission), C4TManagement Inc. is alleged of operating as a 'Ponzi Scheme' andhas offshore accounts in the Cayman Islands estimated to be worthUS$13 million.
(A Ponzi Scheme is a fraudulent plan in which marketers promisingextraordinarily high rates of return in legitimate businessesapparently demonstrated by previous investors' returns gain investors.This is fraudulent as the money is used for personal gains whilstreturns to prior investors come from the money of the new investors.)
Mr. Stenger has stated in his second receiver's report, dated1st February, 2000 - as found at the web site established by hisfirm to report on this case - was "a combination of a PonziScheme and Pyramid Scheme organisation."
(A Pyramid Scheme is one where marketers gain rewards by therecruiting of others who will actually sell the products offered,the marketers receiving a sizable commission of the money as opposedto those who actually sell the product.)
Mr. Stenger's conclusions were that C4T Management Inc. was acombination of both Ponzi and Pyramid Schemes. He states:
"The C4T Scheme was really of combination Ponzi Scheme andPyramid Scheme. Numerous companies were formed, ostensibly toloan money to Sunset Financial, LLC, which was supposed to thenloan that money to C4T. These companies secured their funds fromoutside, individual investor/lenders.
However, instead of the money being loaned directly to C4T, themoney was diverted to pay commissions to marketers and interestpayments to prior investors. Again, while payments were beingmade to the original investor/lenders, these moneys were not comingfrom the conduct of a profitable business, but from monies securedfrom new investor/lenders lured by the apparent profitabilityof the investment plan.
Based on current available information it would appear that therewere between 20 to 25 investment programs and that the averageinvestment was approximately $200,000. The interest rate promisedvaried depending on the individual program and the amount invested.It would appear that the lowest rate promised was 1.5% per monthand the highest rate promised was 3% per month.
At this time, the number of individual investors in the schemeis still uncertain. However, based on correspondence we have hadwith investors it would appear that there are well in excess of1,000 investors. Many investors rolled over IRA and 401(k) plansinto their investments, which may explain, at least in part, thelarge size of the average investment. Preliminary review of availableinformation shows that a large number of investors were elderlypeople who invested a large portion of their life savings intothe scheme."
In January of this year, the Cayman Islands Monetary Authority(CIMA) invited Mr. Stenger and representatives of the SEC to meetwith the Attorney General, the Hon. David Ballantyne, the thenhead of CIMA, Mr. Neville Grant, and Senior Crown Counsel forthe Government's Legal Department, Mr. Stephen Hall-Jones, toexchange information and explore possibilities and option betweenthe SEC, the Monetary Authority and the Attorney General.
In respect of that meeting, Mr. Stenger stated, "Much progresshas been made in a short period of time to allow this exchangeof information and it appears that a mutually beneficial arrangementwill result."
It subsequently came to light that Mr. Stenger was concernedat the appointment of PriceWaterhouseCoopers as liquidators.
Mr. Stenger stated in one receiver's report: "The receiveris concerned that if the Gause/Homa Cayman companies are not placein liquidation, PriceWaterhouse Coopers will continue to placethese individual companies involved in the C4T Scheme into liquidationin the Cayman Islands in a manner which may favour certain investors\creditorsover others. In addition, the PriceWaterhouseCoopers liquidationsdo not provide a ready mechanism to coordinate the liquidationsin the Cayman Islands with this receivership proceeding."
It has also been learned that the "beneficial" ownerof Harbour Management Ltd. is one of the U.S. individuals whoseassets are in receivership. Included in the portfolio of HarbourManagement Ltd. are three Cayman Islands condominiums and theirinformal and preliminary value are estimated to be worth US$ 4million. These condominiums were subject to a freeze order sinceOctober 1999. Mr. Stenger has removed the freeze order to enablethe sale of the properties for the benefit of creditors.
Over several days in March, 2000, the Cayman Islands Grand Courtwith the Honourable Justice Graham presiding replaced Mr. ChristopherJohnson and Nicholas Freeland with Mr. Cleaver and Mr. Stengeras Official Joint Liquidators of International Professionals Ltd,Combined Asset Management, Morningstar Ltd., JMP International,Inter-World Holdings, Opal Holdings and JIBO Ltd.
Mr. Justice Graham also heard 19 Petitions filed by a major investorwhose claims total US$ 2 million, and was seeking compulsory liquidationsof 21 companies including: Arabella Holdings, Bellwether HoldingsLtd., Global Loans Advantage Inc., Harbour Management Ltd., HavenCompany, Inter-World Holdings, International Professionals Ltd.,ITL Corp., JIBO Ltd., JMP International Ltd., MTN Investments,Nascaydomus Enterprises, OPL Ltd., Opal Holdings, Redwood Investments,Sovereign Capital Holdings, and Unique Projects.
This creditor was seeking in his petitions, the appointment ofMr. Ian Wight and Mr. Michael Pilling of Deloitte & Toucheas Court appointed liquidators. During the hearing these petitionswere amended in favour of the appointment of Mr. Cleaver as onof the court appointed Joint Official Liquidators.
Subsequent to the hearing, Mr. Stenger stated in his fifth reportas a receiver:
"I am pleased to report that Justice Graham has now appointedMr. Cleaver and myself as Joint Official Liquidators of all companieswhich wee the subject of the Supervision Petitions and the RemovalApplications, and 12 of the companies that were the subject ofthe Compulsory Liquidation Petition."

He further reported:
"Mr. Justice Graham ordered the Mr. Johnson and Mr. Freelandimmediately turn over all records and work product in their possession.
The records have been turned over and are in our possession.
Mr. Johnson and Mr. Freeland were also ordered to closed downa web site they had created entitled 'Cash4Titles.net' and transferall rights to that we site to me so that I can link it to theCash4Titles.com web site."
The decision of Justice Graham to remove Mr. Johnson and Mr.Freeland as liquidators is currently up for appeal in the Courtof Appeal during their current session that runs from 17th Aprilthrough 5th May 2000.
Mr. Stenger recently announced that a meeting of the creditorswill be held on 14 June 2000 in Cayman - the place and time tobe determined.
Further information may be obtained in connection with this caseat web site HYPERLINK "http://www.Cash4Titles.com" www.Cash4Titles.com, or telephone the 'hotline' for a recorded message as to thestatus of this intriguing case at 616-956-1298.

Major Internationaltheme restaurant and gift shop on the waterfront

The face of downtown continues to change with the opening of theworld's No 104 Hard Rock Cafe. The Grand opening is set for Friday,the 28th of April.

Also nearing completion is the 20,000 sq. ft. - 15 specialty storesDuty Free Mall- pictured in the background, which features largeindoor aquariums as a free attraction to visitors and tourists.

The Duty Free Mall is a unique development, with it's bold Caribbeanmulti-colours theme. It was the first commercial building downtownto incorporate lookout towers - a feature adopted by Hard RockCafe and another 60,000 sq. ft. multi-use retail, restaurant andoffice complex going up nearby.



10,000 Visitors and Growing!

... and just intime ... Cable and Wireless is about to announce some "excitingnews about internet service in the Cayman Islands."
CaymanNet Newswill bring you full details of this immediately after a PressConference to be held at 11:00 am on Monday, 1st May.
Stay with CaymanNet Newsand get this exciting news 'first'.

There is speculationthat there will be another round of reduction of rates for Internetusers.

We will continueto present the news ... "as it happens... when it happens" Be sure to pick up yourown copy of Cayman Net News... TheNew Full Colour WeeklyNewspaper-
Now on Sale... everywhere...!

Cayman Net News' website is being up-dated. Please staywith us for more HEADLINE NEWS DAILY.

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