LANDSBANKI ADMINISTRATOR IN THE SPOTLIGHT FOR MONEY LAUNDERING: A spectacular theatrical twist in the case of the Criminal complaint by the Group of victims of Landsbanki Luxembourg: The Council Chamber of the Court of Appeal ruled against a dismissal and requested the initiation of an investigation for money laundering, false accounting and conspiracy. It smells of sulphur as the liquidator of the bank, cannot hide behind immunity from prosecution. The liquidator Yvette Hamilius has always refused to heed any criminality in the file nor allow any hint of it to thwart her proceedings and even lodged complaints (against several lawyers in France, Luxembourg and Belgium) The Group of victims of Landsbanki Luxembourg bank in liquidation, rejoice and speak of the decision by the Court to instruct the complaint they filed in November 2012 for fraud and breach of trust, in Luxembourg Court, as an HISTORIC decision. On the 10th of july, The Council Chamber of the Court of Appeal partially reformed the judgment by Judge Ernest Nilles, to proscribe the case, which was made on 23 December 2013. At the time, the judge had found that it was timed-out on the offenses imputed to the directors of the Icelandic bank. The judgment to proscribe the case, was considered as very shocking by the victims of these toxic loans who readily accused Luxembourg of being a sanctuary for fraud whilst all other countries around it had launched criminal proceedings against the bank. The group of victims appealed that decision. The Luxembourg court will therefore now start proceedings for the criminal offenses of laundering (directly implicating the liquidator), false accounting of Landsbanki Luxembourg and conspiracy. The basis of the facts relating to the fraud and the breach of trust has been rejected, but should reappear in the money laundering investigation, since it is the primary factor in money laundering offences. A Remarkable judgment in contrast to the impression of laziness and lack of effort which seemed to affect the instruction proceedings, but also the civil courts in Luxembourg responsible for judgments in the cases of Landsbanki Luxembourg. The Luxembourg subsidiary of the Icelandic bank had sold toxic loans as financial products called equity release”, or loan offers secured by a mortgage property owned by the borrower, and an offer of a life insurance contract backed by investment funds tied to Iceland Landsbanki shares (the judgment suggests a probable conflict of interest). The client victims numbered in hundreds and mostly retirees. When the bankruptcy was declared, these customers were unable to repay their loans. The liquidator then immediately began procedures to realize the collateral, which means the forced sale of properties. The Court Decision of 10 July will wipe the slate and mark the launching of a criminal investigation procedure in Luxembourg, without, however being able to predict the result. In any case, there will be an investigation, which will clarify things. That’s already a step in the right direction. THE SUBSTANCE OF THINGS Until now, whilst there is rapid progress in the Criminal proceedings in France and Spain (including indictments) and investigations to determine the responsibilities of directors of the bank in Luxembourg, there seemed to be a feeling of judicial immunity in Luxembourg, rather as if the alleged fraudulent system fabricated by the delinquent bank were to simply float over Luxembourg like the Tchernobyl cloud. Money laundering offenses are punishable, even if the criminal offense is committed abroad, which excludes the Grand Duchy from being protected by impunity for Money Laundering practices, “ said a statement from the Group of victims. They hope that this decision will allow us to get to the bottom of things regarding the realization of assets obtained as a result of fraud. It must, ensure, said the text, that all perpetrators, accomplices and accessories to these possible violations are brought to account before the criminal courts if money laundering offenses are identified. May justice continue it’s work. Yvette Hamilius, the liquidator of the bank, had always refused to see the criminality behind this case and never wanted to file a complaint against the former bank directors. This is an untenable position. She is now at the heart of the money laundering proceedings , although nothing says that at the end of it she will be charged , or even referred to a trial court. INTERNATIONAL COMPETENCE OF THE INSTRUCTING JUDGE This decision made by the Council Chamber of the Court of Appeal placed the debate on another footing that that of proscription of the case : that of the international jurisdiction of the instructing judge. If he is not competent, say the judges, to investigate offenses of embezzlement and fraud (committed in France, Spain and marginally in Portugal), he is, to pin point the specific offences of falsifying and malfeasance and money laundering. As regards the offense of money laundering with which the liquidator of the financial institution Landsbanki Luxembourg SA (...), is charged, the Council Chamber of the Court observes that, contrary to the impression of the investigating judge, the liquidator confers no immunity from prosecution, we read in the judgment. In view of the on going criminal proceedings in France, there is sufficient evidence already to suggest that the commercialisation of the “equity release “financial product , was operated by dishonest means which will certainly be qualified as fraud”, continued the judges, whilst adding that the “crime of money laundering is also punishable when the primary offense was committed abroad. COORDINATION OF CRIMINAL ACTION IN THE E. U. In this way , says the group, the judicial work of the Council Chamber of the Court contributes to the coordination of prosecution in Europe in case of unlawful practices committed on the territory of several Member States of the Union. This is a significant breakthrough in the fight against financial crime. Simply put, the reasoning of the judges is as follows: to establish money laundering, which is a secondary offense, we must first establish the primary offense, which may be in France and Spain, where criminal proceedings have been on going for the offence, amongst others, of fraud, false accounting, falsification, forgery, . If these offences are established, it puts the administrator in a very bad light, insofar as she has attempted to realize and has realized in some cases, the proceeds which in the context are presumed fraudulent. Any proceeds realised, resulting from fraud, would constitute presumed money laundering on the part of the administrator. In the circumstances it would be very difficult for Me Hamilius to demonstrate that she was unaware that the loans and guarantees were the proceeds of a criminal offence, in view of the numerous appeals made by the victims, as well as all the investigation procedures opened abroad which should have sounded the alarm bells loudly and led her to lodge a complaint ( something which she has always blankly refused to do so far) instead of stubbornly continued her virulent realisation of dubious assets . The instructing judge could not refuse to instruct the case for the offence of money laundering, said the judgment of 10 July, so reforming the judges Nilles’ order whilst demanding that the instructing judge (...) continue the investigation into the offenses qualified as money laundering (Article 506-1 of the criminal Code), false accounts and balance sheets of Landsbanki Luxembourg (...) and conspiracy in malfeasance. Translated from an article by Veronique Poujol for Paper Jam
Posted on: Tue, 22 Jul 2014 12:42:03 +0000
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