It’s A Lovely Place, I Think I’ll Buy Something: How Fraudsters Hide Overseas Assets

Welcome to the June 2017 edition of our newsletter!  In this issue, we’ll examine the intricacies of multi-national asset searches, and look at some of the strange things fraudsters will buy with their ill-gotten gains.

Catch Me If You Can: Tracing Assets Across The Globe

As fraud schemes have grown more sophisticated, so too have the ways in which fraudsters will try to protect the proceeds from being detected.  40 years ago, the most common ideas were to buy real estate in an offshore tax haven, typically using a company, spouse or other relative to do so.  As time has progressed, some areas of the world have increased the level of secrecy available to those willing to pay for it, such as in Bermuda, where companies must maintain publicly available registers of officers and directors, but are not required to disclose shareholders.  This can be made further opaque by having a shareholder be a company from another haven jurisdiction – thus, if a fraudster’s company is compelled to provide information during litigation in one jurisdiction, investigators then having to contend with the rules of a second jurisdiction (or more – we’ve traced a network of companies across 13 countries) to properly identify the individual at the end of the trail.

Strange Toys: The Unusual Places That Fraudster Funds Occasionally Go

Also of note are some of the more unconventional assets fraudsters will acquire with the proceeds of their schemes.  Recent news articles, often citing forfeiture orders issued once prosecutors have succeeded in following the money, have found what amounts to a very strange storage locker of items: awards given to celebrities in the past, which were then auctioned and won by the fraudster; artwork and even proceeds used to finance feature films.  Although some of these records are non-public, and thus only obtainable via discovery proceedings, other items often merit a mention in an article or database, such as when a limited liability company no one has ever heard of – but of which you’ve been made aware during an asset search – suddenly appears in Variety as providing millions in financing for a screwball comedy.

Database records have improved in recent years in terms of providing leads in identifying non-US company officers or directors in many jurisdictions and, while it is possible that all of these persons can be fronts for the true, “silent” owner, most people have to work with someone eventually, and most also only trust a small network of associates.  By following people and their connections around the world, you are likely to find the items they are trying fervently to keep secret.