Department of Justice Recovers Millions in Criminal Proceeds Via a First Time Forfeited Asset Sharing by Guernsey Officials
United States prosecutors and investigators are recovering more than $14 million linked to two U.S. criminal cases, in which the money was laundered via Guernsey, thanks to a first-time ever sharing of forfeited assets by Guernsey officials. Guernsey is a significant offshore financial center located in the English Channel near the coast of France.
“The United States and Guernsey have a valued and close law enforcement relationship, and this first-ever asset sharing from Guernsey to the United States is the latest outward sign of our strong ties,” said John P. Cronan, Acting Assistant Attorney General for the Department of Justice’s Criminal Division. “Today’s announcement sends a strong message that the Department of Justice and our counterparts in Guernsey will not rest until defendants are brought to justice and denied the illicit proceeds of their crimes.”
Guernsey Attorney General Megan M.E. Pullum, Q.C., and Guernsey Solicitor General Robert M. Titterington, Q.C., announced their commitment to transfer the funds to the United States under a bilateral asset sharing agreement that entered into force between Guernsey and the United States in February 2015. Their announcement came during a meeting with U.S. officials at the Department of Justice’s headquarters today.
The $14.3 million to be shared from Guernsey represents one half of the net proceeds recovered in that jurisdiction that stem from the two U.S. criminal cases, which are discussed below. Guernsey will retain an equal amount.
Most of the funds being transferred from Guernsey – more than $12.77 million – stem from Guernsey’s cooperation in connection with the prosecution of defendant Raymond Bitar and his associates by the United States Attorney for the Southern District of New York. In April 2013, Bitar pleaded guilty to unlawful internet gambling and conspiracy to commit bank fraud and wire fraud. He admitted to defrauding customers of his Full Tilt Poker operation by lying to them about the security of their funds held by Full Tilt Poker, and by falsely promising players that their funds would be protected in segregated accounts. Instead, Bitar and his accomplices used players’ funds for whatever purposes that Bitar directed, including to pay him and others millions of dollars and to cover the operating expenses of Full Tilt Poker. Ultimately, Full Tilt collapsed and was unable to pay players approximately $350 million that it owed to them. In connection with his plea and sentencing, Bitar agreed to forfeit $40 million dollars in money and other property derived from his offenses, including the funds he maintained in Guernsey.
The United States Marshals Service expended significant work on the post-conviction tracing, recovery, and liquidation of the criminal assets of Bitar and his associates, both domestically and internationally. Between November 2012 and June 2015, the Justice Department’s Office of International Affairs sent a series of three Mutual Legal Assistance requests to the Guernsey authorities seeking their assistance with the tracing, restraint, forfeiture and recovery of the proceeds that had been laundered to Guernsey. In response to those requests, the Guernsey authorities used domestic proceedings to block the Bitar accounts, provided bank records that facilitated the U.S. investigation and forfeiture, and ultimately gave effect to the final U.S. judgment of forfeiture and liquidated the accounts.
The remaining funds to be shared by Guernsey – more than $1.56 million – stemmed from the prosecution of defendant Paul Hindelang and his associates by the United States Attorney for the Southern District of Florida. Hindelang was large-scale importer of Colombian marijuana into the United States during the 1970s and 1980s. Similar to the Bitar case, Guernsey’s assistance in connection with the Hindelang case ultimately included the registration and enforcement of a U.S. judgment of forfeiture against assets that were laundered to Guernsey and the liquidation of those assets.
This is the second time assets have been shared pursuant to a 2015 asset sharing agreement between the United States and Guernsey. In 2016, the Department of the Treasury shared more than $2 million with Guernsey in 2016. Guernsey has long been a reliable partner with the United States in the areas of anti-money laundering and forfeiture cooperation.
Representatives from the United States Marshals Service, Homeland Security Investigations, and the Office of International Affairs, who provided substantial assistance in this matter, also were on hand for the asset sharing announcement.