The Government of Grenada says it is taking legal action against KYC News for an article published by Offshore Alert on April 30, 2004 about Prime Minister Dr. Keith Mitchell.

This was disclosed on Monday in a release sent out to media houses on the island by the Government Information Service (GIS).
The release was issued within hours of the holding of a press conference by the parliamentary opposition National Democratic Congress (NDC) in which it called on the Grenadian leader to clear the air on the allegations made in the article.

The publication made allegations of a certain financial transaction involving Prime Minister Mitchell while on a trip to Switzerland in 2000 in connection with the appointment of German fraudster Eric Resteiner to a diplomatic position.

It made mention of the exchange of a briefcase containing $500, 000.00 and of the transaction being secretly video-taped. In the Offshore Alert article, Dr. Mitchell is quoted as saying that he did meet with Resteiner.

"There was nothing improper about it", Dr. Mitchell allegedly told Offshore Alert. "It was payment for expenses incurred by our delegation during a trip to promote Grenada and pursue possible economic benefits for the country". "We were there because Mr. Resteiner led us to believe that he could benefit Grenada's economy. He offered to pay our expenses and since we are a small country with limited resources, we accepted.

"This was approved by the Cabinet and it is a common occurrence that businessmen help with expenses incurred on the country's behalf. The Offshore Alert article identified Resteiner as a defendant in a lawsuit alleging securities fraud that was filed by the Securities Exchange in Massachusetts in the United States.

A default judgement was entered against him on August 19, 2002 when he was fined $US4.4 million and ordered to disgorge $US15.9 million in ill-gotten gains. The SEC alleged that Resteiner and others defrauded at least 50 investors by selling bogus "risk-free" investment products that purported to pay monthly interest of between four and five percent.

According to Offshore Alert, the German trickster is a former resident of the Bahamas, where he lived in a luxury house purchased from another suspected fraudster Viktor Kozeny (The Pirate of Prague), a former envoy with the Mitchell government.

Kozeny is under indictment in Manhattan in the United States on charges that he stole $US182 million from clients of an investment firm. Kozeny was once associated with the multi-million dollar project to develop the Lagoon marina and Butler House, the former offices of late Grenadian marxist leader, Maurice Bishop.

The Mitchell Government has issued a press release in which it seeks to advise the public of the following facts:

*Dr. Eric E. Resteiner was appointed by Cabinet as Trade Counsellor for Grenada in 1999.

*In 2000, as Trade Counsellor, Dr. Resteiner offered to cover the expenses for a trip by the Prime Minister to travel to several countries in Europe, as part of a promotional and investment tour to France, Austria, Leichtenstein and Switzerland, as well as Kuwait.

*The matter was considered by Cabinet. Cabinet agreed that the offer should be accepted.

*Dr. Resteiner provided the Government's delegation with the necessary financial support to cover the expenses of the promotional visit.

*The method by which this offer was provided, deliberated upon and transacted was transparent, as Trade Counsellors, Ambassadors at Large and similar representatives of Grenada often provide Government with financial support to assist in travel and investment promotion abroad, as well as certain economic, social and other activities in Grenada.

*The appointment of Dr. Resteiner as Trade Counsellor was revoked by Cabinet in 2001.