From left: Fred Kaiser, Peter Turnquest and Captain Randy Butler.
By NEIL HARTNELL
Tribune Business Editor
nhartnell@tribunemedia.net
The deputy prime minister on Thursday night branded claims that he “conspired” to defraud Sky Bahamas’ financier of almost $27m via sham loans as “categorically false”.
K Peter Turnquest hit back at allegations levied by two companies controlled by Fred Kaiser, a Canadian businessman with whom he previously enjoyed a long and close relationship, by saying he was “appalled” his name had been dragged into a dispute with another “former business partner”.
That business partner is Captain Randy Butler, chief executive of Sky Bahamas, which was forced to cease flying last year after the Bahamas Civil Aviation Authority refused to renew the air operator certificate that was required to carry fee-paying passengers. Mr Turnquest, though, noted that he is not named as a defendant in Mr Kaiser’s statement of claim - only Captain Butler.
Implying that the dispute has nothing to do with him, Mr Turnquest said: “The Writ does not name me as a defendant but makes several allegations in its statement of claim that are categorically false.
“I deny these false claims. I am appalled that my standing as a public servant made calling my name in this dispute between my former business partners worthwhile. There is no room for that kind of misuse of our judicial system in our society. I am confident that the facts will defend my integrity once presented.
“My record of transparency and accountability in my private and public life is a matter of record and reputation. My focus remains on further deepening our democracy by enacting legislation to reform and modernise the management of our economy and public finances as we work through this very challenging period in our country.”
It is unclear why the action brought by Mr Kaiser’s companies, Alpha Aviation and Advanced Aviation, does not also include Mr Turnquest as a defendant given that it calls the deputy prime minister’s name repeatedly.
It also notes that he acted as “a director and manager” of both entities, as well as “owning and/or controlling and/or managing the two companies listed as defendants, Sky Bahamas Airlines and Aviation Oversight Group. The latter is understood to be a Sky Bahamas affiliate.
Mr Kaiser, whose main business interest, Alpha Technologies, agreed in 2004 to pay some $36m to the Internal Revenue Service (IRS) after pleading guilty to tax fraud, is alleging that Captain Butler and Mr Turnquest engineered a decade-long conspiracy that lasted until 2017 “to enrich themselves” by defrauding his companies while concealing their activities.
The statement of claim, which has been seen by Tribune Business, claimed that the duo “dishonestly caused” Alpha Aviation and Advanced Aviation to “pay away” $20.68m and $5.917m, respectively, to Sky Bahamas via “some kind of bogus loans”.
No particulars were given to describe how the scheme worked, although Mr Kaiser’s companies alleged that Mr Turnquest and Captain Butler then used “some 39 fraudulent invoices and/or book entries, and for no adequate consideration”, to drain away some $3.8m paid by Alpha Aviation to Aviation Oversight Group via 39 separate cheque payments between February 2008 and July 2016.
A further $3.026m was also alleged to have been siphoned off by the duo “as at December 31, 2017, to AOG Maintenance Ltd, a company that owned Sky Bahamas’ maintenance hangar at Lynden Pindling International Airport.
“In breach of their duties of honesty and fidelity as directors and/or managers of both the plaintiffs (Alpha Aviation and Advanced Aviation) and of the second and third defendants (Sky Bahamas and Aviation Oversight Group), and their duties to act in the best interests of the companies, Turnquest and Butler failed to keep or to ensure that the companies kept any, or any adequate, financial books of account or financial records recording and/or documenting the companies’ financial transactions, failed to maintain or keep any proper or any proper management accounts or bank or cheque or wire transfer reconciliations and failed to put in place any or any adequate financial controls or systems,” the statement of claim by Mr Kaiser’s company alleged.
Further claiming that “none of the payments were documented properly, or at all”, the statement of claim alleged: “At all material times, Butler knew or must have known that the receipt by Sky Bahamas and Aviation Oversight from Alpha and Advanced were paid away by Turnquest in breach of his fiduciary duties and dishonestly, and were received by Sky Bahamas and Aviation Oversight... on behalf of Alpha and Advanced and held by them on resulting trust for the plaintiff.”
Kaiser and his companies, making it clear that they have come for the monies they believe are due and owing, are seeking a Supreme Court Order that an accounting be done to determine what is outstanding and that this money subsequently be paid to them.
Several observers on Thursday privately told Tribune Business they thought the nature of the allegations, consisting of financial irregularities and accounting improprieties, would make it difficult for Mr Turnquest to remain in his post as minister of finance - effectively the nation’s chief financial officer.
There was no sign of any such moves last night, though, as Mr Turnquest effectively sought to disassociate himself from a dispute that he sought to pin on Captain Butler and Mr Kaiser. This newspaper understands that senior members of the Free National Movement (FNM) were briefed that the lawsuit was imminent some weeks before it was filed.
However, Captain Butler, when contacted by The Tribune on Thursday, pointed the finger of blame at Mr Turnquest and denied any knowledge of the latter’s financial dealings with Mr Kaiser. While he “absolutely, categorically” denied the allegations against himself, the former Sky Bahamas chief questioned whether there was an effort “to protect” the deputy prime minister by not naming him as a defendant.
“Don’t forget I am not his director of finance,” Captain Butler said in reference to Mr Kaiser. “I don’t have any access to his money; never did. I think you could see whose name he called in all those places. He’s naming the of two of his companies who was his accountant, director and managing director.”
He acknowledged that it may look odd, when pressed by The Tribune, that as a shareholder and chief executive he “knew nothing” about Sky Bahamas’ finances, but said he had always insisted he was the “technical guy” who ran the airline’s operations and left the finances to Mr Turnquest before the latter left for government.
“I had nothing to do with money and that kind of stuff; the accounts and all that. I didn’t have anything to do with that. They go in every paragraph to the money man, and say I should know. How do you make allegations against him [Mr Turnquest] and protect him at the same time? Fred has put out there death by 1,000 pieces for me.”
Legal sources suggested that Captain Butler and his attorneys will likely apply to the Supreme Court to add Mr Turnquest as a third-party defendant, but the Sky Bahamas chief did not confirm that on Thursday.
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Comments
ThisIsOurs 3 years, 4 months ago
"The Writ does not name me as a defendant but makes several allegations in its statement of claim that are categorically false."
thing is this isnt some foreign entity filing in our courts. Michael Scott filed the claim, they both from Grabd Bahama. Michael Scott working on the Lucayan deal, a big item for Turnquest. wouldn't it be extremely strange for him not to know this?
Why the denial take so long. This is very strange. And "senior FNM officials knew for weeks"? And they didnt have a rebuttal prepared?
Its also odd that Butler says he didnt handle the finances but only he is named. Who handled the finances?
It's also strange for this much money to flow through the company and only Butler knows about it. As Director and a professional accountant it seems like questions should have been asked. That in itself is bad enough how does someone like that look after the county's finances.
tribanon 3 years, 4 months ago
All excellent questions and observations.
ThisIsOurs 3 years, 4 months ago
would be interesting to find out if Mr Kaiser has been attempting to get any other business dealings going in the Bahamas that have been denied.
"Sky Bahamas’ financier "
It's weird how the narratives over the years made this company seem like a bootstrap company when millions were flowing to it from an intl investor. the whole thing is just plain weird
John 3 years, 4 months ago
This is a tangled web. Was Turnquest named to cause embarrassment or is his hand in deep pit? It was strange that as the second highest ranking man in the country, he couldn’t get Sky Bahamas back up and flying. So are the plaintiffs attempting to force certain actions in a last ditch effort to recover? And what if Turnquest is complicit? Remember he just borrowed $1.3 Billion on behalf of the people of The Bahamas ( and the financial secretary is acting). Should these loans now be microscopically scrutinized? And what is Turnquest has to resign... will this put irreparable damage on the Minnis Administration do much so that there has to be early elections? And is the main opposition house in order,at least to the point that the Bahamian people will have enough confidence to put them back? Remember it is not business as usual in government and in government and economies stouthearted world. Will it be a matter of allowing more Lito on a sinking ship already under drive?
IslandWarrior 3 years, 4 months ago
Press Statements and denial will not change the fact that the Deputy Prime Minister and the Minister of Finance, of the Commonwealth of The Bahamas, is the subject of this level of corruption-probe that is now a matter before the Supreme Court of The Bahamas and now reported internationally. The alligations are stating that while as a sitting Member of Parliament and Deputy Prime Minister, Mr Turnquest siphoned off $3.026m "as at December 31, 2017". The court documents also allege that the Minister and his business partner "dishonestly caused" Alpha Aviation and Advanced Aviation to "pay-away" $20.68m and $5.917m, respectively, to Sky Bahamas via "some kind of bogus loans". As this shameful development unfolds, it should be an honourable gesture from an Honourable Minister and member of the government in as high an office as the Deputy Prime Minister to vacate his Public Office immediately until such time that this matter is adjudicated by the courts of the Commonwealth of The Bahamas. For many years, successive PLP Administrations, led by now-deceased Prime Minister Sir Lynden Oscar Pindling, and his government that maintained a dark cloud of suspicion in the global business community, where it was widely believed by many that The Bahamas was a nation for sale because of corruption at many levels of government that eventually caused its downfall and ushered in the Ingraham Administration with its Government of Transparency, Government in The Sun Shine mantra. The Minister along with former Minister Wells with responsibility for transport (who himself is named in a 'multi-million dollar waste to energy deal that went bad while he was a Minister of State under the past PLP administration) also recently submitted to the House of Assembly, budget approval for 900,000 dollars worth of Vanity License plate printing equipment that is listed by the manufacture for just $95,000.00.
http://thetribune.media.clients.ellin...">SOLO UV Inkjet Printing The DigiTagTM SOLO UV Inkjet Printer by IslandWarrior
shonkai 3 years, 4 months ago
Why was Mr Turnquest a "business partner" anyway? Could it be for his expertise in aviation or for his connections? Doing business in the Bahamas is easier when you have a hgh-ranking official on your side.
Honestman 3 years, 4 months ago
This is serious and the very last thing this FNM administration needs right now.
tribanon 3 years, 4 months ago
Are you kidding?! The amounts here are chump change compared to the staggering sums that are the subject of other very devious shenanigans involving corrupt members of our current political ruling elite.
happyfly 3 years, 4 months ago
Bahamian lawyers and politicians are all so so happy to make huge fees putting their 'honorable' name on the line as a director or shareholder when these investments are going well..........and so so quick to go hide under a rug when things get squirmy. And yet another example of a foreign investor thinking he had some rock-solid partners managing his investment in the country, only to be thrown under the bus and labeled an evil foreigner when the time comes to pay anything back.
tribanon 3 years, 4 months ago
The fix may already be in if Minnis has steered this court case to Justice Winder who somehow ends up hearing just about every case that could possible cause serious damage of any kind to a sitting government, whether of the PLP or FNM persuasion. We all remember just how instrumental Justice Winder was in looking after Vomit Christie, Baltron "Bag Man" Bethel and The Wicked Witch of The West Maynard-Gibson in The Baha Mar ownership matter.
And just think, as bad as KP Turnquest has proven to be in handling our country's finances, Minnis is probably relishing the idea of replacing him with someone like Brent symonette or Dionisio D'Aguilar. LOL
birdiestrachan 3 years, 4 months ago
I am with Mr: Turnquest on this one. He is not that foolish
tribanon 3 years, 4 months ago
You clearly don't know KP as well as many of us do.
Kalikgold 3 years, 4 months ago
This comment was removed by the site staff for violation of the usage agreement.
BONEFISH 3 years, 4 months ago
This situation was bubbling below the surface for some time. It just hit the media now.
TalRussell 3 years, 4 months ago
Usually, the injection of $27 million handed over to any we natives is right up there that even if were to concede this early out the golden finger pointin' gate in favor of the now embattled MOF, still at the barest of minimumsshouldn't there still the minimums must be unpussled if but to soothe over a nosey PopoulacesOrdinarey at large POAL?
Shakehead once for upyeahvote the watch clock now ticking how long before the colony's MOF's hair dye, starts streakin' down, twice for not?
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