The most telling evidence that exposed the role of the Keith Mitchell-led government with the collapsed First International Bank of Grenada (FIBG) came from former offshore regulator, Michael Creft in testimony given last December in a Court in Oregon.
Creft was called to give key evidence against four persons who were committed for fraud - Rita Regale, Larry Barnabe, Douglas Ferguson and Robert Skirving.
The defendants each received prison sentences for stealing millions of dollars from funds lodged with the bank by clients mainly in the united States and Canada.
In his testimony Creft disclosed that he collected $100, 000.00 from First Bank to help Mitchell's New National Party (NNP) with its campaign for the 1999 general election.
He said that he personally hand delivered $50, 000 in cash to Dr. Mitchell and another $25, 000 to then Party Treasurer, Tony Joseph which helped the NNP to its 15-0 clean sweep of the polls.
As a public service, GRENADA TODAY has decided to publish verbatim the question and answer session with Creft while on the Witness stand in the court in Oregon in the United States:
MICHAEL CREFT, was produced as a witness on behalf of the Plaintiff, and after having been duly sworn on oath, was examined and testified as follows:
DIRECT EXAMINATION
BY MR. ROBBINS:
Q: Good morning, Mr. Creft. Would you state your name, please, and spell your last name for the court reporter.
A: My name is Michael Creft, C-r-e-f-t.
Q: Thank you. Mr. Creft, where do you presently reside?
A: I presently reside in Manresa, St. George's, Grenada.
Q: Okay. And were you born and raised in Grenada?
A: I was born and raised, yes.
Q: Did you leave Grenada at some point for purposes of your education?
A: Yes.
Q: Where did you go and what was your education?
A: Initially, New York City. I left Grenada when I was 18. Initially, New York City, and then Winnipeg, Manitoba, University of Manitoba.
Q: Okay. And what degree or degrees did you earn?
A: I earned a bachelor's degree in economics, started a master's degree in economics, but I did not finish.
Q: Okay, What was your work history after you obtained your degrees?
A: I first worked with the Federal Department of Transport in Canada, then with the Federal
Department of International Agriculture and
International Affairs in Regina, Saskatchewan.
And then also with Manitoba Department of Highways and Transportation.
Q: What was your job for those various departments?
A: I served mostly as an economist and policy analyst.
Q: How long all together did you work in Canadian government positions?
A: Closely about 22, 24 years.
Q: Okay. Did there come a time when you returned to Grenada?
A: Yes.
Q: And approximately when was that?
A: In August of 1997.
Q: And how was it that you went back to Grenada?
A: Well, I went back because I wanted to, before formally retiring, contribute something to the development of my country, Grenada, the country of my birth.
Q: Okay. Did you have a job lined up when you went back?
A: I had discussions, yes. Yes, I did.
Q: With whom did you have discussions?
A: I had discussions with the then Minister of Finance.
Q: Okay. And who was that?
A: It was then Dr. Mitchell.
Q: Did he hold any other positions in addition to the Minister of Finance?
A: He was the prime minister.
Q: Could I ask you to just pull that microphone
down towards you a little bit and maybe speak up. I'm having a little bit of trouble hearing you. Thanks.
And as a result of those discussions, what job did you get in Grenada?
A: It was the registrar of offshore services in Grenada.
Q: What does that mean? What were your duties? What was the registrar of offshore services?
A: The registrar of offshore services was to regulate the offshore industry, or offshore sector that was just established, and it was contained -- the regulations were contained in an act that was then passed.
In addition to regulating, also promoting the industry to a new industry in Grenada in 1997.
Q: Okay. What do you mean by the offshore industry? What does that mean?
A: Well, that was -- it means that -- Well, first of all, the industry itself, as I said earlier, was new. It means that we had various areas in the legislation, for example offshore banks, insurance, internet gaming, and also Economic Citizenship Program.
These are all programs where people from abroad, Grenadians couldn't sort of take part in that sort of industry.
People -- this was mostly for a tax purposes, use it as a tax savings in most of the Islands that have this similar legislation.
Q: So, is this kind of industry common in other
countries in the Caribbean?
A: Very much so. Caman Islands, Turks & Caisos, Barbados, St. Vincent, St. Lucia, Bahamas, Bermuda.
Q: And why was Grenada moving into this realm?
A: Because it was felt at the time that we wanted a diversified economy. All along we were depending on agriculture and tourism.
We felt that it was an area, seeing that some of these other Islands were doing so well in this particular industry, that Grenada could also reap some benefits from that particular industry.
Q: Okay. And you say your job was to both regulate and promote?
A: Yes.
Q: And what do you mean when you say promote?
A: Well, to -- Since it was a new industry in particular, it had to let people know by entertaining -- by visiting and going to various trade shows and meeting various people in various parts of the world, Europe, Asia, and North America, letting them know about the services that we offer and the prices that we offer. Because at the time, since we were just getting into the business, we had to sort of offer our prices that were for those services that would be attractive to them.
Q: One of the things you mentioned was economic citizenship. Could you explain to us what that
is.
A: Yeah. That is a program which is offered in the United States and Canada and Australia and New Zealand. It's a program where people who are interested in obtaining a second passport and become a citizen of another country, they can apply, and once they apply and they meet the provisions of the act, they will then be given a citizenship and a passport for Grenada.
Q: How much does it cost to get a passport through the Economic Citizenship Program?
A: I cant remember right away, but it was $50,000 U.S., plus you have to contribute another I think it was $200,000 towards development for some particular, a sector of the economy, whether it's infrastructure or something like that.
Q: What do you mean when you say contribute towards a sector of the economy?
A: Well, the applicant will decide. They're given an option of, what they can decide, what particular area they had to -- I won't say contribute, but they had to pay towards obtaining of this passport. Could have been a school or roads or something like that. But it must be -- That's part of the application process, or the approval
process.
Q: Okay. And was Larry Barnabe involved in the Economic Citizenship Program?
A: Mr. Barnabe had a company that was involved in the Economic Citizenship Program, yes.
Q: Well, what do you mean when you say involved?
A: I was going to say that he was an agent There were other people who are agents. There are lawyers who are agents. Mr. Barnabe's company was an agent, applied and became an agent for the company for -- for an agent for the Economic Citizenship Program, yes.
Q: Okay. So what function did his company perform?
A: Well, as far as I know--Well, as far as I know, he would file applications for various applications. File application -- file documents for applicants who would be interested in the program.
Q: Now, you said this is just like programs in the United States? The United States has a program like that The United States has programs for people to obtain citizenship in the United States, but not economic citizenship.
A: Well, I don't think it's called --
Q: Well, okay. What was your role with Economic Citizenship applications?
A: I had to -- There was some procedures that had to be followed in terms of the different -- what can I say, we had -- Excuse me. We had procedures that you had to follow. And after -- the agent had to provide us with the different -- with the -- all the materials.
And after the materials come in, we'd have to review them and do the necessary background checks, do background checks of the persons who was under the name that was submitted.
Following that, we'd have to then, once we sent out the checks to the various organisations, the FBI, Scotland Yard, and other organisations, when we get that back, if it's okay we would then, then forward it to the Passport Office who do their own search. But we would advise them that the passport should be granted.
Soon after that they would then, if they agreed on the basis of their own due diligence, they will get back to me and I will then recommend to the Prime Minister's office that this person be granted a citizen of Grenada.
Q: Was this program subsequently discontinued --
A: Yes.
Q: By the government of Grenada?
A: Yes.
Q: Now, when did you actually start working as
registrar of the offshore sector?
A: I think it was in September of 1997.
Q: Okay. Did there come a time when you began
discussions about the formation of First International Bank of Grenada?
A: Yes.
Q: And how long after you started working there did that happen?
A: I think it was around November, December, that the lawyer from Boston --
Q: Well, let me just stop you right there, and could you take a look at Exhibit 18-3, which is in front of you?
A: Yeah.
Q: Do you recognise Exhibit 18-3?
A: Yes.
Q: And that is the Certificate of Incorporation for First International Bank of Grenada, right?
A: Yeah.
Q: And what is the date on that?
A: That's 1997.
Q: October 2nd, right?
A: 2nd of October, 1997, yes.
Q: So the conversations you were just starting to tell us about happened before that time; is that right?
A: Yes. Yes.
Q: Okay. Now, you were starting to talk about a lawyer you dealt with?
A: Yes.
Q: Who was that?
A: I can't remember his name, The fella from
Boston.
Q: Was it Ralph Sherman?
A: Ralph Sherman. Ralph Sherman.
Q: Okay. And who else did you talk to during the formation stages of First Bank?
A: Gil Ziegler.
Q: And is Gil Ziegler, did he subsequently become known as Van Brink?
A: No. No, not Gil. Not Gil. The other brother.
Zig.
Q: Zig. Zig. Zig.
A: Not Gil.
Q: All right. And was this the first bank you were involved in setting up?
A: Yes.
Q: Was it the first of the international banks in Grenada?
A: Yes. First that I dealt with. I understood there was one before.
Q: Okay. But that was before your time and you don't know that much about it?
A: Yes.
Q: What were the requirements for setting up an offshore bank in Grenada?
A: Well, it was set up to establish -- it was -- I mean, one had to provide capitalisation of the bank, a $250,000 capitalisation.
Q: How much again?
A: I think it was 250,000.
Q: And in what form was that capitalisation supposed to be made?
A: Cash.
Q: Okay. What else?
A: I can't remember. The applicant had to have
some business experience, and I can't remember
the specifics.
Q: Well, they had to set up a corporation.
A: A corporation, which is what is in the exhibit that's here. Because that had to be first.
Certificate of Incorporation had to be first done before we --
Q: Right. Could you take a look now at Exhibit 18-4, which is in the notebook there, and tell me what that is.
A: Yeah.
Q: And what is that?
A: That is a letter I wrote to the Prime Minister in his capacity of Minister of Finance recommending that, that First Bank be, the application be approved.
Q: Okay. And what is Exhibit 18-5?
A: Oh, that's the license itself.
Q: That's the actual license?
A: The actual license, yes.
(To be continued)
