Isle of Man financier faces ban over role in US scam (Observer)

Isle of Man financier faces ban over role in US scam
Conal Walsh and Adrian Gatton
The Observer, Sunday 8 September 2002

An Isle of Man financier is facing disciplinary action after details of his role in a huge money-laundering scam emerged in a US court.

Peter Bond, who denies wrongdoing and has not been charged by the US authorities, could be disqualified from company directorships following a legal move by the Financial Supervision Commission (FSC), the island’s regulator.

He managed the personal fortune of Robert Brennan, a notorious American fraud ster who used the Isle of Man’s banking secrecy laws to stash a fortune away from his creditors.

Brennan was sentenced to nine years in jail last year by a New Jersey federal court. Bond, who was unavailable for comment this weekend, gave evidence against him under a guarantee of immunity from prosecution.

The two men met after Brennan’s high-profile broking firm, First Jersey Securities, collapsed in 1995, leaving him with debts of $75 million.

Brennan held $4m of non-traceable bearer bonds, which he did not declare to creditors and detectives in the US. Instead, he placed this money with Bond, who invested it in the stock market via Bank of Scotland accounts and shell companies.

The fortune quickly swelled to $20m. Brennan used the money to fund a lavish lifestyle, including gambling trips to Monaco and Sun City, a 450-foot yacht and several luxury homes.

Bond, who lives in Douglas, the Isle of Man’s capital, told the court of an elaborate system of passwords and covert meetings, which Brennan devised to have cash delivered to him in hotel lobbies and homes.

Brennan’s lawyers claimed Bond was an unreliable witness in the case, accusing him of involvement in laundering Russian money.

But Bond rejected the allegations and insisted that he had not been aware that Brennan was defrauding creditors. He was backed by US prosecutors.

John Apsden, head of the Isle of Man’s regulator, confirmed that a disqualification application was filed against Bond at the island’s High Court last week, but declined to comment further.