By NEIL HARTNELL
Tribune Business Editor
Two Bahamians accused of facilitating an alleged $500m securities fraud and money laundering scheme are celebrating after the courts in Belize quashed the US bid to extradite them.
Kelvin Leach and Rohn Knowles, who were indicted by US prosecutors in eastern New York some four-and-a-half years ago, succeeded in defeating efforts to have them answer the allegations by arguing that Belizean law and their constitutional rights under it were breached.
The duo, both financial services professionals and the principals of a Belize-based broker/dealer, Titan International Securities, had their victory confirmed when the Belize Court of Appeal ruled that US investigators had violated the country’s telecommunication interception laws by secretly recording their conversations.
Their attorney, Eamon Courtenay, argued that this also violated their right to privacy, and not to be subject to arbitrary search and seizure, under the Belize constitution. The procedural errors and irregularities thus doomed the US extradition attempt against the two Bahamians, with the Belize court of appeal ruling in late March 2019 that the matter be “permanently stayed”. That means the US authorities can no longer seek their extradition in this matter.
Messrs Leach and Knowles were arrested by the Belize authorities on September 15, 2014, as they sought to leave the country via private jet. Tribune Business understands the duo were then mulling whether to return to The Bahamas and fight US attempts to extradite them from here.
Financial services industry sources familiar with the duo revealed at the time that Mr Leach once worked as an inspector for the Securities Commission, examining the regulator’s licensees to ensure they were in compliance with all laws and supervisory norms. Once source even recalled Mr Leach “leading” the regulator’s examination of his firm.
Mr Knowles, meanwhile, is understood to have been a former employee at RoyalFidelity Capital Markets, where he worked as a securities trader, before he made his way to Belize. Mr Knowles is understood to have family connections to Sir Garet ‘Tiger’ Finlayson.
Thomas McGuire, a Federal Bureau of Investigation (FBI) agent, revealed in a September 2014 affidavit that a more than two-month ‘wiretap’ of phones belonging to Titan and other individuals/entities in the alleged scheme was conducted. Some 2,000 phone calls were intercepted and monitored.
Both Messrs Leach and Knowles were listened to, confirming wire transfers and taking trading orders, some from clients engaged in tax evasion and money laundering. The indictment against them alleged that they and Titan aided a fraudulent scheme devised by a US citizen, Robert Bandfield, and his Belizean partner, Andrew Godfrey.
The US district attorney for eastern New York, Loretta Lynch, later attorney general under the Obama administration, alleged at the time: “Bandfield and his co-conspirators devised not only a fraudulent scheme but an elaborate corporate structure, based on lies and deceit, designed to enable US citizens to evade and circumvent our securities and tax laws.
“They set up sham companies with figureheads at the helm in an attempt to deceive US law enforcement and regulators, and bragged about their scheme to their clients.
“Today’s sweeping indictment, charging the individuals and companies responsible for this $500 million scheme, closes this fraudulent offshore safe haven and sends a strong message to those who seek to abuse the financial markets in order to enrich themselves that we will investigate and prosecute them no matter where they set up shop.”