Banking arrangements have been estabusted with Barclays Bank Plc, High Street, We have placed $700,000 in & US dollar Certificate of Deposit which is now 15/12 00 15:26 FAX 1 268 461 0422 INTL.BUSN.CORPS. 7. ASSISTANCE TO THE OFFICE OF NATIONAL MONEY LAUNDERING The Supervisory Authority of the ONDCP is investigating the affairs of the Bank, its shareholders and its principals for being in violation of the Money Laundering (Prevention) Act (MLPA), No. 9 of 1996 as amended. After receiving written notice from the Supervisory Authority in compliance with the provisions of MLPA, we provided the Supervisory Authority with access to the Bank's records for their review. The ONDCP's review concluded that there were reasonable grounds to believe that a money laundering offence had been committed. On March 31, 1999, (Suit No. 86 of 1999) the High Court of Justice of Antigua and Barbuda ordered that the Money Laundering Supervisory Authority be allowed to share information in its possession with United States Customs officials and Federal Bureau of Investigation agents (see attached Appendix 3). We have fully complied with the said Order when requested. CONCLUSION We are satisfied that we have identified all assets of the Bank as reported at the date of our appointment and taken control of these assets. The list of customers with deposits in the Bank can now be considered final as sufficient notice has been given for claims to be made. The affairs of the Bank and its principals continue to be investigated by both the United States and Antigua and Barbuda Authorities in respect of money laundering. We intend to await the outcome of the investigations pending before seeking the New 15/12 '00 15:26 FAX 1 268 461 0422 INTL.BUSN. CORPS. In the HIGH COURT OF JUSTICE OF IN THE MATTER OF THE LIQUIDATION OF On August 7, 1997 and August 20, 1997 Mr. Donald B. Ward and Mr. Charles Walwyn respectively were appointed Joint Receiver/Managers of Caribbean American Bank Limited by the Supervisor of International Banks and Trust Corporations. On November 19, 1997 the Receiver/Managers were ordered to wind up Caribbean American Bank Limited (CAB) by Order of the High Court of Antigua and Barbuda. Appendix 1 to this report sets out the Statement of Affairs of the Bank at June 30, 2000. Appendix II is a Statement of Receipts and Disbursements for the period August 7, 1997 to June 30, 2000. A summary of the Financial position of the Bank at June 30, 2000 is as 15/12 00 15:26 FAX 1 268 461 0422 INTL.BUSN.CORPS. 2. POSSESSION OF ASSETS At the time of our appointment as Receiver/Managers of CAB, we took possession of its books and records and we compiled statements of the Banks'financial position. We notified other institutions of our appointment and took control of all known liquid funds totaling US$911,886 belonging to the Bank. As required by the International Business Corporations Act, we opened an account in the names of the Joint Receivers/Managers. The account is in United States dollars and it is held at Barclays Bank Plc, High Street, St. John's, Antigua. There is an amount receivable of $50,000 representing funds being held by the United States Customs Service Department as a result of a seizure order issued by the United States District Court of Northern Florida. Recovery of this money is doubtful in light of charges being brought by the United States Government against the Bank and its directors in respect of money laundering. The Bank has a certificate of deposit in the amount of $56,631 with American International Bank (In Receivership). Recovery of this amount is very uncertain as the likely outcome of the receivership is unknown. Fixed assets with a value of $934 could not be identified nor located. Currently the Bank has assets totaling $944,554 of which $50,000 has been seized The Bank's records report amounts due to depositors of $980,516 with interest payable of $175,592 on depositor balances. Claims received from the Bank's principal customers amount to US$1,132,000.45 which exceed recorded balances by $595,759.80. The variance between the claims received from it's principal depositors and the Bank's records of amounts owing is in respect of claims received from lawyers on behalf of the specific depositors. We have not at this stage been provided with any evidence to support the claims beyond the recorded balances in the Bank's records. Given the financial position we do not have sufficient funds to pay depositors in full. 15/12 00 15:26 FAX 1 268 461 0422 INTL. BUSN.CORPS. 4. LOANS AND ADVANCES 5. 6. There are two shareholder loans of record, both of which are for $500,000. The loans appear to have been granted by the Bank to enable the shareholders to finance the capitalization of the Bank. The funds were never deposited into the Bank. The two shareholders are holding companies, which have issued bearer shares, and we do not know who is in possession of the shares. Collectibility of these loans is unlikely and the amounts have been written-off in the books of the Bank. The shareholders of the Bank are under investigation for money laundering (See 7 below). AMOUNTS DUE TO CREDITORS Total liabilities amount to $1,156,107.89 comprised of $980,516 due to depositors and $175,592 being accrued interest on customer deposits. Claims amounting to $1,132,000.45 were received from lawyers acting on behalf of specific depositors. The claims exceed the balances in the Bank's records by a total of $595,759.80 and the claimants have not provided any evidence to support the additional amounts claimed. We advised the claimant's lawyers that they would have to present us with the appropriate powers of attorney from each of the depositors prior to our being able to provide information related to the specific balances in each account or to effect a distribution. No further communication has been received from the lawyers. The other depositors have not come forward to claim their funds. All depositors of the Bank are under investigation for money laundering (see item 7 below) INVESTING OF FUNDS Banking arrangements have been established with Barclays Bank Plc, High Street, We have placed $700,000 in a US dollar Certificate of Deposit which is now |