Olint money search - US prosecutors on the hunt for funds, assets
Published:Sunday | August 14, 2011 | 12:00 AM
... Local investors escape probe
Arthur Hall, Senior Staff Reporter
With the sentencing of David Smith, the mastermind behind the failed Ponzi scheme Olint, out of the way, United States prosecutors will now turn their focus on finding the money defrauded from thousands of persons.
But Jamaicans, including politicians who might have received payouts from Olint, will not be targeted.
"The judge (Mary Scriven) made it clear that the US will not go after persons across borders," attorney-at-law Professor David Rowe told The Sunday Gleaner.
Rowe - the US-based Jamaican attorney representing nine persons burnt by Olint - pointed to documents filed in court by prosecutors in which they made it clear that they would not be going after Olint investors who made a profit from the scheme.
not enough evidence
"First, the United States simply does not possess sufficient evidence and business records of the defendant to identify all the investors who made a profit and calculate how much profit was received," the prosecutors said.
"Second, most, if not all, of the investors who made a profit reside outside the United States, and thus, are beyond the jurisdiction of this court," added the prosecutors.
They noted that going after persons outside the US would require applications using mutual legal assistance treaties and would have to be supported by sufficient admissible evidence to prove the claims.
Instead, the prosecutors are going after assets which they believe Smith might have stashed away.
Already, the prosecutors have identified a house in Florida, which, they say, was purchased with a US$159,881 down payment traceable to Smith's wire-fraud proceeds.
The prosecutors have also seized more than US$5 million, which was in accounts held by Smith as part of US$128 million, which he has admitted to acquiring through wire fraud.
Substantial assistance
Smith has agreed to help US prosecutors in their further probe into Olint and to identify any assets that could be used to repay its investors, and Rowe told The Sunday Gleaner that if he provides significant information to the authorities, his 30-year prison sentence could be reduced.
Smith's lawyers have already disclosed that he has been providing assistance to Jamaican investigators dealing with "certain highly sensitive and confidential investigations" and the Turks and Caicos (TCI) Special Investigations and Prosecution Team in relation to a probe into possible corruption or other serious dishonesty by past and present members of its legislature.
"If that assistance is substantial, Smith could benefit from a Rule 35 Motion," Rowe said.
"This is a motion filed by a prosecutor under the authority granted by Rule 35 (b) of the Federal Rules of Criminal Procedure. It asks a court to reduce a previously imposed sentence based on substantial assistance by a defendant provided after sentencing," added Rowe.
He noted that "substantial assistance" is a matter of prosecutorial discretion as some prosecutors do not consider information to be "substantial" unless it leads to something specific such as an arrest, indictment, or conviction of a co-conspirator.
"I do not think David Smith will get Rule 35 consideration from the Middle District unless major figures in the public corruption investigation in the Turks and Jamaica are arrested and convicted," Rowe added.
US authorities had invited Olint investors to file claims for the amount defrauded them, and while there is no indication yet of how or when any investors would be reimbursed, the search for Smith's hidden assets is now on in earnest.