CI money men arrested in US

(CNS): The managing director of Clover Asset Management, a Cayman Islands investment management firm, along with two other men with Cayman Islands connections have been charged in the US with money laundering. The men are expected to appear in court in Virginia Friday to answer charges involving the alleged transfer of ill-gotten gains from a bank fraud in the US to the Cayman Islands via the Turks and Caicos Islands. A Canadian national who set up Clover in 2007, Eric St-Cyr was arrested earlier this week along with his lawyer, Patrick Poulin, who is based in TCI, and Joshua Van Dyke, a third Canadian national who works for Clover.

CNS has obtained copies of the court documents with the assistance of Miami-based watch-dog OffshoreAlert (posted below), which allege a detailed conspiracy in which the men agreed to launder the proceeds of a criminal enterprise on behalf of a client who was, in fact, a US law enforcement agent acting undercover.

Speculation that the alleged conspiracy was also connected to the recent arrest of Bryce Merren on drug trafficking and money laundering charges could not be confirmed. This case alleges a conspiracy to transfer the proceeds of crime from the US to Cayman via TCI, and although the figure is the same amount as that in the Merren case, there appears to be no connection at this stage.

Court documents accuse the men of soliciting clients and of hiding assets from the US government as a result of the money laundering scheme. Lulled into a set up by the US agents, the Cayman financiers were told that the proceeds they were being asked to launder were from a US bank fraud. The men then reportedly created an offshore foundation domiciled in Cayman called "Zero Exposure Inc".

The men allegedly wired $200,000 from the USA last December from a bank in Arlington, Virginia, first to the Turks and Caicos Islands and then a few days later on to Cayman, where the cash was invested.

During the process of the alleged conspiracy, which was meant to see some $2 million launder through Cayman, the court documents say that Vandyk and St Cyr told the US agents that they charged clients “more to launder criminal proceeds than to assist in tax evasion.”

According to the court documents, before going further the US agents said they wanted to see how the money could come back, and so just under $200,000 was wired back to TCI and then to Chesterfield, Virginia, in January.

A resident of Cayman for several years, St-Cry is also an amateur chef, having won the Bon Vivant contest at the 2012 Cayman Cook-off.