Bank sued in theft case

(CNS): Butterfield Bank (Cayman) Ltd is facing legal action as a result of a fraud perpetrated by an insurance manager who is currently serving a five year prison sentence in HMP Northward after admitting stealing around US$1 million from his clients. David Self, who was the manager of Monkton Insurance Services Ltd, was convicted last year after admitting the theft. However, in a complicated twist in the fall out of the collapse of Monkton due to the crime, William Ritter, a third party who was a client of Monkton from the US, has filed a complaint against Butterfield, which had cleared the forged cheques signed by the white collar thief.

The action followers an earlier suit by the Cayman Islands liquidators of Monkton Insurance, Gordon MacRae and Gwynn Hopkins of Zolfo Cooper, who also named Ritter in their efforts to recover some of the missing cash.

According to a report on the Miami-based OffshoreAlert, Ritter has filed his action in the US against the bank to protect himself from the liquidators, who allege that when Ritter discovered that Self had stolen $735,000 from his Cayman-domiciled captive Geneva Insurance SPC Limited, he threatened to report Self to the police and the Cayman Islands Monetary Authority (CIMA) unless Self transferred $875,000 directly to Ritter, rather than Geneva Insurance. 

During Self’s sentencing hearing in the Grand Court in Cayman last year, the judge heard that this escalated the 53-year-old man’s criminal behaviour as he began taking money from other clients to try and pay off Ritter and buy his silence, before the entire fraud became too much and he was eventually discovered and confessed all. The liquidators say that Ritter’s demands amounted to unjust enrichment.

However, Ritter claims in his complaint against Butterfield Bank that no money should have come from his account there for Geneva Insurance SPC Limited without his signature. However, the bank honoured the forged cheques signed by Self, which were unlike Ritter's signature, and the complainant claims that any amount of due diligence would have readily detected the forgery.

Ritter accuses the bank's representatives of facilitating Self’s fraud when they accepted the forged cheques, which he claims is a breach of contract and a violation of the law.