In his judgement of February 4, 2010, HHJ Hardy in deciding to go ahead with the James Ibori case at the Southwark Crown Court, London said his decision had to base on the answer to the question: whether Justice Awokunlehim decision of December 17 can be said to be a final decision seeing that the EFCC has appealed against the Judgement.
The relevant Nigerian law is Section 286 and 301 of the Criminal Procedure Act which provides as follows:
286. If at the close of the evidence in support of the charge it appears to the court that a case is not made out against the defendant sufficiently to require him to make a defence the court shall, as to that particular charge, discharge him.
Dismissal and Acquittal
301. (1) Where a complaint is dismissed and such dismissal is stated to be on the merits such dismissal shall have the same effect as an acquittal.
(2) Where a complaint is dismissed and such dismissal is stated to be not on the merits or to be without prejudice such dismissal shall not have the same effect as an acquittal.
Justice Hardy noted that James Ibori was only discharged in Nigeria but not acquitted and then concluded:
“I have read the ruling carefully and also the notice of appeal and I am influenced by the fact that the dismissal was not during the course of a trial where evidence has been heard by the Judge and cross-examined, and by the learned Judges final comment, following his criticisms of the investigation itself “that his ruling was based on the evidence before this court”. It seems to me I can infer the learned Judge’s ruling was not one based on the merits and that therefore in accordance with Section 301(2), it does not amount to an acquittal. Accordingly I find that the Asaba ruling is not determinative of the proceedings in the United Kingdom and there is no Abuse of Process”.
This outcome is not totally unexpected. Firstly, the Economic and Financial Crimes Commission had basically come at the same conclusion and lodged an appeal based on the same premise that Ibori was only discharged but not acquitted.
Secondly, the lower courts have made some errors that they are not ready to admit now. I mean, would it make sense to hold on to Ms. Udoamaka Okoronkwo for months, only to release her now saying there is no case against her?
Thirdly, by arguing that Ibori was merely discharged but not acquitted in Nigeria, he successfully distinguished and avoided the bar to Ibori’s further prosecution in RvRoche 1773 1 Leach 134, R, where it was held that an acquittal by a foreign court is a bar to an indictment of the same offence in England
But would the appellate courts give Ibori and his associates favourable judgement as the defence lawyers have already filed their appeal?
It is significant that in the February 4, 2010 judgement, HHJ Hardy also said:
“one of the ironies of this case is that as a result of the defendants earlier successful submissions, the so-called LR2 submissions from Nigeria have been discounted, and the crown have been compelled to go down on the so called Anwoir root, relying very little on the evidence from Nigeria but on inferences the crown say are to be drawn from the circumstances in which the property was handled”.
The charges against Ibori and his associates that include his wife, Theresa Nkoyo; his sister, Christine Omatie Ibori-Ibie; his former secretary, Adebimpe Pogoson; his mistress, Udoamaka Okoronkwo; his lawyer, Bhadresh Gohil, and others include allegations that he conspired and grossly inflated prices and invoices of government contracts all arranged to benefit him. In effect, he was defrauding the state government that he headed, for private gain.
Other charges state that following a conspiracy concocted while Mr. Ibori was governor, his accomplices manipulated UK financial institutions, its law, and investment structures, with the intent to defraud.
Mr. Ibori, his mistress, Udoamakaa Okoronkwo faces four charges of money-laundering, just as does his wife, Theresa, while Bhadresh Gohil faces four counts of money-laundering.
The charge sheet also showed further allegations against Mr. Gohil and two associates: Daniel McCann and Lambertus De Boer.
There are new charges that relate to the sale of V-Mobile telecoms shares by Akwa Ibom State and Delta State, in which about $37.8 million (N5.7 billion) was allegedly stolen.
Grave charges these!
Yet in the words of Justice Hardy, the “crown have been compelled to go down on the so called Anwoir root, relying very little on the evidence from Nigeria but on inferences the crown say are to be drawn from the circumstances”.
In other words, as I pointed out in Part 1, the Nigerian evidence having been discarded earlier, and because of the paucity of available evidence, the court would have to rely almost solely on inference and circumstantial evidence.
Before going into the nitty-gritty of the evidence supporting the above charges, it might be correct to say that the greatest victim of the Ibori saga is Ibori’s UK lawyer, Bhadresh Gohil.
Bhadresh Gohil of Arlingtons Sharmas was one of the numerous lawyers involved in handling the due diligence and corporate governance over the Ibori transactions. Yet his firm is the only one targeted.
His crime? His law firm allowed Ibori and his wife to use the firm’s client account and to make payments on their behalf – a common practice for international lawyers when dealing with high value overseas client but could also indicate that money has been laundered. The Met police alleged that certain due diligence documents were backdated.
The Met Police said his firm did not do any due diligence on Ibori, however a perusal of the Court documents show documents to prove his firm carried out not only normal due diligence actions but in fact enhanced due diligence as Ibori was a politically exposed person.
It is a matter of regret that the police failed to mention that not one but two independent expert computer forensic reports contradict this police allegation. His firm’s accounts and financial records are independently audited by the British Law Society yearly – and to date no query has ever been raised. Moreover, the documents establish that he has the backing of the Law society on the matter.
The second allegation against him relates to the purchase of the property in Dorset on behalf of Ibori; that a company was used to hide the true identity of the owners/beneficiaries.
Nearly 35% of all properties bought in the UK are purchased in the name of the overseas companies whereby the beneficial owners are behind the Company but could also indicate hiding of ill-gotten money.
There are a variety of reasons for using overseas vehicles to buy properties on behalf of beneficial owners including tax, inheritance and structuring. But in this transaction there is evidence to show payment for the property was by a cheque from a UK bank and not cash. Also the police – same Police officer has sworn witness statements that confirm the property belongs to the Ibori’s. And that the funds can be traced back to Ibori, so is the identity really hidden?
The third charge relates to the purchase of a Challenger 300 Jet by Erin Aviation Limited, in which Ibori was one of several investors. This for Arlingtons Sharmas was an ordinary everyday commercial transaction.
The issue here is that the movement of funds from Ibori’s PKB Geneva bank to the joint venture partner Parabola’s bank at Schroders in Geneva is described as “layering”. It was a simple transfer of funds which incidentally identified the purpose of the funds for the Challenger purchase and going into a shareholders account.
On this particular case a Swiss judge, Mr Justice Dumatheray, later reviewed the transaction and the various companies involved and found nothing wrong.
The other charge is with regards to $4.7 million received from Shell/Chevron as contract payments to MER Engineering and two key British Police Officers MacDonald and Gardiner, in sworn witness statements both independently confirm the funds legitimacy.
The fourth charge relates to the filing of a suspicious activity report. The Met police say that Gohil should have mentioned Ibori in this document. He only mentioned the recipient account of the $4.7 i.e. Parabola, in that obligatory filing.
Legal experts say such filing simply cannot result in criminal charges otherwise it would make every person filing a SAR worldwide capable of becoming criminally liable.
The final charge relates to the opening of a bank account for Mrs Ibori, with a US bank called AIDT. Financial experts are dumbfounded as the referring of a client to open a bank account in their own name is simply not a crime.
I was told: “The source of inflow of funds into the account was properly verified by the US bank. They were satisfied. Indeed the opening of a bank account in the US itself is not criminal. It is one of the most regulated environments, and money launderers hardly open accounts in their own name”.
Then recently the Met police made allegations against Ibori’s UK lawyer Gohil and others in respect of African Development Funds Inc – in respect of the sale of Delta and Akwa Ibom states’ shares in V-mobile. This transaction was also investigated in Nigeria by the EFCC and nothing came out of it.
This is because, M.S. Hassan (Head of Legal, Lagos) wrote a LEGAL OPINION CR NO 10357 07 on that same case and concluded in a document dated 26 November 2008 viz; “I humbly recommend that based on my answers to the issue for determination, the ADFI money temporarily frozen from account can be released to them and also the charges that were filed at the High Court which was purely to prevent the account from being de-frozed by the court should be abated, the case was adjourned by the court sine die pending when the issues are resolved.”
The EFCC under Ribadu himself found no reason to continue with the case against the accused, as the Mr. Hassan’s legal opinion quoted above testifies.
Gohil has stood resolute against the Met Police intimidations. It must appear to any independent observer that he is simply being attacked because he is Ibori’s UK lawyer.
A senior lawyer from his firm stated: “We have complied with all requirements in respect of the money-laundering regulations. Mr Gohil has done absolutely nothing wrong. All allegations including ADF matters are completely baseless. It is an unfortunate political witch hunt against one of the firm’s clients. We continue to remain firmly behind and support Mr Gohil, we will continue to fight for what is right without fear and favour.”
The case against Ibori’s lawyer in London appears to be based upon normal, non-suspicious everyday commercial transactions. All transactions funds were not in cash but in reputable and established banks in accordance with international standards.
Bhadresh Ghohil is regarded as highly experienced high value transactional lawyers that apparently have ensured that the various transactions have complied with international regulations. It was his attention to detail that helped progress the transaction to closure. Yet he is now guilty by association.
The London files do not show stolen money. They show as would be expected, a Law firm’s detail of a complex commercial international transaction, which the UK Law Society have reviewed and found nothing wrong.
“The London Police and their Nigeria’s agents have merely created mischief and mayhem, distorted the facts and turned a genuine commercial transaction into criminality”.
A UK Lawyer expressed amazement at the level of mayhem and the media furore generated by the Ibori trial.
He said he has seen cases from several jurisdictions including India and South Africa, but the vehemence of the Ibori trial, the extent of the allegations and the mind-boggling figure involved surprised him.
“What are all these about”, was his constant refrain.
Part of this amazement was the amount and the allegation being bandied about.
Well, the information the London Police depended on was being provided by the EFCC. And Ribadu said in the PUNCH newspaper of 12/09/2009.: “The UK authorities are treating it as an internal investigation. They attended the office of Ibori’s lawyers and the various financial institutions involved and part of what they found there was evidence of money stolen from Nigeria to the tune of $37.8m. They then suggested that the offence was committed in the UK. That is what they are investigating”
By my discovery it appears Ribadu was wrong to say that “$37.8 million was stolen from Nigeria”. The amount involved is $38.5m representing primarily the 5% agreed agent’s fee, under exclusive arranger agreements, which were both only entered into after extensive negotiations.
My sources say each state received well over $350m after the shares sales and profited handsomely. “To have charged a 5% fee on a success basis was in accordance with international norms in telecoms transactions”, I was told.
This key fact has been omitted. These sales were not guaranteed and all the numerous parties involved in the deal were fully aware of the charge as they were also the subject of international litigation and a whole number of other issues. A 5% fee was the only money paid out to ADFI for having successfully pushed the faltering deal to closure and protected the States’ interest. Had no deal been concluded, no fee was payable.
The total value of the V-mobile transaction was over $1.6billion, as there were numerous shareholders, including another State and Banks.
What Nigerians are not aware of is that this transaction was extremely well documented and ADFI and under the auspices of the Central Bank of Nigeria.
“ADF paid its accruals into Access Bank here in Nigeria. In fact all aspects of the transactions are transparently present in media archives, thus explaining why the EFCC found no problem in arriving at the truth and clearing all involved”.
Turing back to Ibori, the London police claim that Ibori had no other source of income except his salary as former Governor of Delta State from 1999 to 2007 and that such money was not enough to purchase the landed assets, and the invested $4.7 in a jet charter company.
Now, the Met police talks about unspecified and unaccounted enrichment. The inference that Ibori could not have arrived at his wealth evidenced by his acquired properties in London from his salary as a governor of Delta Sate.
But in a paid newspaper advertisement in several newspapers last year under the heading, “The Ranting of a Serial Liar”, Ibori said:
“Ribadu should know that before I became Governor, my collective wealth was substantial. Even the London Metropolitan Police have admitted in their own witness statements filed in court that one of my private companies earned in excess of $5 million annually. I have been the most investigated Governor in Nigeria and the EFCC and London Metropolitan Police are in possession of my bank statements from the Bank of Austria, Merrill Lynch, Citibank (I was a CitiGold member—a club of high networth customers) and Barclays Bank before I became a Governor. As it is usual with police tactics all over the world, both the EFCC under Ribadu and the Metropolitan Police have refused to exhibit these bank statements, because they do not support the dubious “rags to riches” picture they want to paint of me. In fact, every politician in Nigeria knows that I contested elections in 1998 with my personal resources, with no contributions from any quarters whatsoever. These facts can be verified, unlike Ribadu’s tales”.
The true figure of Ibori’s assets restrained to date is about £6m in physical properties, made up of the three London houses. The rest is the $21m in respect of the Challenger purchase, of which $4.7 is linked to Ibori.
Ibori says the remainder $16.3 in the cost of the jet does not belong to him, and can be identified as having been paid by Erin Aviation.
In 2008, Met Police officers travelled to Mauritius and verified the source of Erin’s funds and found them to be clean. Other claims that the British Police have seized significant cash sums could not be verified.
What therefore is exactly the REAL value of Ibori’s assets under contention? It now appears that this figure had been taken out of all context.
The first issue which has been taken out of all context is the valuation of the assets restrained. When the initial restraint order was attached, media accounts were suggesting figures in excess of £80m to £120m.
However, it appears that Ibori’s three properties could not have been worth more than £5m at the time – and indeed the Defence claims it would show that these properties were all legitimately purchased and over a period of time.
On the Challenger jet: Both the London Metropolitan Police and EFCC have long discovered, having received the Swiss banking file from PKB Bank, a payment of $4.7 million from Ibori’s bank in Geneva (PKB), the real status of Ibori’s funds in the money for that aircraft that was supposed to be used for commercial charter flights and not as a private jet.
These funds – $4.7 – were then used as an investors shareholder account into a company called Parabola, which in turn invested these funds into the jet under a joint venture agreement. This is the extent of Ibori’s investment in the jet.
Also, the source of the funds invested in the jet have been verified by EFCC and the London Met Police to have emanated from payments oil companies such as Shell and Chevron made to another company owned by Ibori; MER Engineering.
It’s baffling therefore that the EFCC and the Met police announced to the whole world that Ibori laundered money through some oil majors operating in Nigeria. Even the Financial Times of London published such a story in late 2007.
But the Financial Times of London had published denials from both Shell and Chevron that they did not launder money for Ibori but had paid a company linked to him for genuine commercial contracts.
The one-sided and factually inaccurate story on the web: “How James Ibori bought a Challenger Jet” thus appears ill-founded.
In his Federal High Court Asaba ruling Justice Awokulenhin said this of the money laundering charges against Ibori and the oil companies:
“In counts 107-122, the 1st and 2nd Accused/Applicants are charged with transferring various sums to the account of the 1st Accused and that of Stanhope Investments Limited, a Company beneficially owned by 1st Accused/Applicant which sums were derived from an illegal act with the aim of concealing the illicit origin of the sums and thereby committed an offence punishable under section 34(1) of the Money Laundering (Prohibition) Act, 2004. The evidence in respect of these counts are Statements of accounts of 1st and 4th Accused/Applicants, account opening forms and various instructions for transfer of sums in accounts issued by the 4th Accused/Applicant’s company (signed by ADEBIMPE POGOSON). The Prosecution referred to a letter from the Crown Prosecution at pages 791 of the proof. I have carefully read the letter and the letter confirms that large payments were paid into the 4th Accused/Applicant’s bank accounts by Venture Lagos and Chevron Nigeria. The letter also confirms that the said funds in the 4th Accused/Applicant’s account were transferred on the instructions of POGOSON.
The statement of accounts of the 4th Accused/Applicants (MER Engineering) also shows that several regular payments were made by SHELL NNPC CHEVRON and CHURCH OIL AND GAS and VENTURE LAGOS. There is however, no witness statement in the proof from any staff or official of these companies in respect of these payments. There is also no evidence from any witness statement that those were illegal payments.
I find that the evidence in the proof does not disclose any prima facie case against the 1st and 4th Accused/Applicants in respect of these Counts to justify their being tried in respect of these counts. I consequently, quash the said counts.”
So the judgement made it abundantly clear that the funds did not emanate from Delta State. Where then did the balance of the funds for the jet come from, if they did not come from Delta State?
I was told they came from Erin Aviation Limited and not from Ibori.
So the entire London case could depend upon these points. What then is the “circumstantial evidence” on which the court would rely to come to a definitive judgment? In view of this evidence, could the prosecution prove the money laundering allegations?
Now, the Met police talks about unspecified and unaccounted enrichment, despite Ibori saying there is irrefutable evidence that establishes his significant wealth prior to his Governorship.
He, who asserts, proves. But an inadvertent import of the trial and the prosecutions strategy is that it has effectively shifted the entire burden of proof upon the defence, which is effectively changing the whole basis for criminal law. It is always up to the prosecution to establish their case beyond reasonable doubt.
Predicate offences to prove money laundering
The new principal money laundering offences are now found in sections 327, 328 and 329 of the Proceeds of Crime Act 2002. The legislation is set out in (Archbold 2006 33-8).
Money laundering is defined as an act which constitutes an offence under S.327, 328 and 329 or a conspiracy or attempt to commit such an offence. Money laundering includes counselling, aiding or abetting or procuring.
It should be noted that convictions for money laundering under sections 327 and 328 attract the use of the lifestyle assumptions under S.142 and schedule 2 Proceeds of Crime Act 2002.
Under the Proceeds of Crime Act, the Crown has to prove that the laundered proceeds are “criminal property”, as defined in S.340 of the Proceeds of Crime Act: that is to say that the property constitutes a person’s benefit from criminal conduct.
“Criminal conduct” is all conduct which constitutes an offence in any part of the United Kingdom (which means that an “all crimes” approach is adopted in respect of predicate crimes committed in the UK).
Offences which were committed abroad are relevant predicate crimes if laundering acts are committed within our jurisdiction where the predicate offence committed abroad (from which proceeds were generated) would also constitute an offence in any part of the United Kingdom if it occurred here (S.340 (2) b) (Archbold 2006 33-29).
Proving that property is “criminal property”
To prove that property is “criminal property” (i.e. the proceeds of crime) the prosecutor must show the property:
• Constitutes benefit from criminal conduct or that it represents such a benefit (in whole or part and whether directly or indirectly) and;
• The alleged offender knows or suspects that it constitutes or represents such a benefit [section 340(3)].
Property is obtained by a person if he obtains an interest in it.
Because of the definition of criminal property, there is no distinction between the proceeds of the defendant’s own crimes and of crimes committed by others (see S.340 ). Thus laundering one’s own proceeds is just as much money laundering, as similar activities performed by someone else, notably professional launderers on behalf of the authors of the predicate or underlying offences.
Own proceeds laundering applies to all 3 principal money laundering offences.
Proving that proceeds are the benefit from criminal conduct in money laundering prosecutions (proving the predicate offence).
Proving that proceeds are the benefit of “criminal conduct” will usually be done by circumstantial evidence.
Where money laundering offences are proceeded with on the same indictment as the underlying crimes, the underlying criminal conduct will be proved as part of the proceedings to the requisite standard. Where the money laundering proceedings are “stand alone” it is necessary to prove the underlying criminal conduct in the money laundering prosecution.
It is not necessary in “stand alone” money laundering prosecutions to wait for a conviction in relation to the “criminal conduct” (i.e. the underlying or predicate offences giving rise to the criminal property).
Prosecutors are not required to prove that the property in question is the benefit of a particular or a specific act of criminal conduct, as such an interpretation would restrict the operation of the legislation. The prosecution need to be in a position, as a minimum, to be able to produce sufficient circumstantial evidence or other evidence from which inferences can be drawn to the required criminal standard that the property in question has a criminal origin.
Typically evidence of the criminal origin of proceeds may be provided in money laundering proceedings by:
• Accomplice evidence;
• Circumstantial evidence and/or other evidence;
• Forensic evidence (e.g. contamination of cash with drugs) from which inferences can be drawn that money came from drug trafficking;
• Evidence of complex audit trails, from which an accountancy expert may be able to conclude that the complexity of the transactions indicate that the property was the proceeds of crime. (Archbold 2006 10-66). While this was not a money laundering prosecution, by analogy, it would seem permissible for a witness to give expert evidence that the facts lead him to the conclusion that the property was the proceeds of crime);
• Evidence of the unlikelihood of the property being of legitimate origin – Where the prosecution proves D has no legitimate explanation for possessing the property in question a jury may be willing to draw an inference that it is proceeds of crime;
• Criminals often attempt to launder proceeds through a cash intensive business. Where the cash flows appear too large or the profit margins too high this may be capable of giving rise to expert evidence that the business will usually give rise to a particular level of profit and the profits are clearly excessive which together with other available evidence can be sufficient to prove the underlying criminality. See (R. v. Boam 1998 Cr. Law Bulletin).
The above are what the Crown will have to prove “beyond reasonable doubt” against each of the defendants otherwise they will be acquitted.
Note that, Justice Awokulenhin said this of the money laundering charges against Ibori and the oil companies in his Federal High Court Asaba ruling:
“I find that the evidence in the proof does not disclose any prima facie case against the 1st and 4th Accused/Applicants in respect of these Counts to justify their being tried in respect of these counts. I consequently, quash the said counts.”
Would HHJ Hardy of the Southwark Crown Court arrive at a different conclusion?
Why would Ibori allow himself to be conned by, Tony Baldry, a well known crooked politician, in the name of getting him off the hook through extra-legal means with the help of London lawyer Sarosh Zaiwalla?
Indeed, how did Tom Baldry get to know Ibori?
To be continued
see part 1 Ibori: Why the London case may collapse (1)