ringing a Cayman Islands money-laundering case to a sensational conclusion, Chief Justice Anthony Smellie freed four officers of Euro Bank Corporation because of an 'abuse of process' in which, said Justice Smellie, the Islands senior anti-money laundering official had deliberately destroyed material evidence after a tip-off by the UK Government.
Justice Smellie acquitted Donald Stewart, Brian Cunha, Ivan Burges and Judith Donegan and and accused Brian Gibbs, Director of the Cayman Islands Financial Reporting Unit, of destroying evidence that, among other things, may have shown he was bugging the judge's telephone. Allegedly, Gibb destroyed records after he was tipped off by an unidentified UK Government agency that his home was about to be raided.
In throwing out the money laundering charges because of an "abuse of process", Smellie said: "Gibbs deliberately failed to disclose and knowingly destroyed that evidence which he was aware was highly relevant to this trial."
The full text of the Chief Justice's statement on the affair is as follows:
'On Wednesday 5th November 2002, more than 5 months after this trial began and more than 6 weeks ago, I acceded to an application by the defence for an enquiry upon voir dire into the evidence of the witness E. W. (hereinafter "W").
'By then W’s evidence in chief had been marshalled by Crown Counsel Mr. Mitchell and his cross-examination by Mr. Hill on behalf of Mr. Stewart, completed.
'Being aware of W's central importance as a witness of fact to the prosecution’s case and of earlier concerns expressed by the defence over his true status as a witness; I allowed his cross-examination upon the voir dire by Mr. Cox; that is, in the absence of the jury.
'The question of W's status as a witness, that is whether he was an informant to the director of the Financial Reporting Unit (FRU) Mr. Brian Gibbs, (hereinafter "Gibbs") whilst working as an assistant manager at Eurobank Corporation (“EBC”); had been earlier pointedly raised by the defence in open Court. The FRU is the local investigative agency directly responsible for the investigation of this case. The defence had also, on at least two separate occasions outside of Court, raised the same question with the prosecution. It has now come to light that despite these enquiries, the full nature of W's position had not been revealed.
'The non-disclosure of this fact persisted notwithstanding the fact that W had given three witness statements and had also earlier testified at the preliminary enquiry.
'In the event, as the direct result of answers which W gave under cross-examination upon the voir dire; it became apparent that his relationship with Gibbs was more involved than had been revealed. Of even more immediate concern, this non-disclosure had persisted despite a memorandum of 3rd July which purported to set out Gibbs' recollection of that relationship. This 3rd July memorandum became Gibbs' and thus the prosecution's response to an Order of the Court on 26th June 2002 following on Mr. Cox’ and Mr. Hill’s request for full disclosure of the details of any contact which Gibbs had had with any employee of EBC. The 3rd July memorandum was therefore intended to influence the conduct of this trial. Certain answers given by W upon the voir dire also suggested that the Gibbs' 3rd July memorandum was not correct or complete.
'It then became apparent that the enquiry commenced upon the voir dire had to be taken further.
'I directed that Gibbs be available to be interviewed, with a contemporaneous tape recording of his interview to be kept. The subject-matter would be like that required by the Order of 26th June. Mr. Mitchell suggested that Gibbs was then away on important Government business and so would not be available within the time limits which were then set. I indicated that the matter involved the rights of the defendants to a fair trial and that the interview must be given by Gibbs by the time of the resumption of the trial.
'The trial was then adjourned.
'On resumption of the trial on 18th November, a transcript of Gibbs' interview was made available. He had been interviewed in the meantime by Mr. Talbot. Compared to what has subsequently come to light about his relationship with W, that interview must also be described as an inaccurate and misleading account.
'Having seen the transcript of his interview, the defence properly insisted that Gibbs be presented for cross-examination. I directed that he give a formal witness statement before being presented for cross-examination. A statement was presented in draft on 25th November and formally on 26th November. It then came to light, as reported by Mr. Mitchell, as informed by Gibbs that Gibbs, acting upon the direction of an agency of the United Kingdom Government (“UKG”), had destroyed certain records relating to his contact with W which were among documents which could reveal any connection between Gibbs and the particular agency of the UKG. The reason given for this course of conduct will be examined below.
'Amongst the material destroyed, Gibbs says was material relating to his relationship with W and to this case. This was material which had been returned to Gibbs from the UKG agency for the purposes of this case under what has come to be termed “the London Plan”. According to this plan for disclosure also to be considered below, Gibbs was made responsible for disclosing this material to the defence.
'This material had been compiled and kept in London derived from information Gibbs had sent to London during the currency of the investigation against EBC and the defendants. Amongst other things, it contained a memorandum of a report dated 15 March 1999 which recorded an important meeting that day between Gibbs and W. This report was sent electronically by Gibbs and kept in London in the form of a memorandum.
'Gibbs has since testified that he destroyed the material on the instructions of his controlling agent of the UKG when, on 2nd July 2002, he was telephoned and told by that agent that a search warrant was to be executed at the FRU and at his home by the Commissioner of Police. This search was to be in relation to an investigation arising from suspicions of interference with the judiciary's telecommunications.
'Tangential though that investigation remains to the present enquiry, I will return to comment on it below.
'Gibbs' account of those instructions, upon which he acted so completely and unquestioningly, has been supported by the agent of the UKG who also testified upon the voir dire, under the name of “John Doe”.
'Mr. Mitchell and the Attorney General have stated that Gibbs' actions of 2nd July first came to their attention on or about 18th November 2002. This was when Mr. Mitchell was required as senior prosecuting counsel to "sign off" on Gibbs' interview, for the purpose of accepting that Gibbs had disclosed all that he was required to disclose under the London Plan. Not being comfortable about doing so, Mr. Mitchell pressed Gibbs for confirmation that the material, amongst that returned from the UK, had been disclosed as planned. Then it was that Mr. Mitchell was told about the destruction of material which related to this trial. This was, moreover, in the context of confirmation being sought according to Mr. Mitchell, for the third time by him since May 2002, that the disclosure had been done.
'This alarming turn of events did not end there.
'On 19th November Gibbs, in varying accounts, informed the Attorney and Mr. Mitchell that he held a disc which contained, in electronic form, the relevant material which he had destroyed. He is reported as having told Mr. Mitchell on 19th November, that this material had arrived electronically overnight from the UKG.
'In contrast, he is reported as having told the Attorney also on the morning of the 19th, that he had "discovered" a redacted version of the material which had been destroyed. He is further reported to have said to the Attorney, that it had been put in a safe place, such a safe place that he had forgotten its existence.
'I accept what Mr. Mitchell and the Attorney said about this and it follows that Gibbs lied to one of them. Gibbs has in fact admitted this deception.
'In his evidence upon the voir dire, he said that the account he gave to the Attorney was the correct one. That he had lied to Mr. Mitchell. His reasons for lying at that stage, even after the destruction had been admitted and after some of the material had been recovered will also have to be considered.
'It became apparent from an interrogation of the disc itself, that it held material and that Gibbs saved information on it on 22-23rd May and 20th November 2002; The 23rd May was the date on which information was last saved before as he stated he had destroyed the documentary material which showed any connection to the UKG agency. The material found on the disc was a reduced version of the material which had been brought from the UKG – the material which had been entrusted to Gibbs for disclosure.
'Later, in his responses of the 28th November to requests of the defence for further and better particulars to his witness statement, Gibbs gave the impression that the material on the disc had indeed arrived electronically from overseas overnight the 18th November. He was then confirming the account he had given to Mr. Mitchell – the account which he later impugned in his evidence upon the voir dire. This written response of 28th November he admitted in his testimony on the voir dire was a further lie, this time deliberately included in answers which he knew were intended to be put before the Court. His explanation, which I immediately regarded as implausible and unacceptable from so experienced an operative as Gibbs, was that he was so embarrassed to have discovered the disc and its contents among his records, that he lied about it.
'Not surprisingly, the prosecution not having been content with what they were being told by Gibbs on 19th November, had required the material to be resent by the UKG agency from London. Contrary to the view being then expressed to them by Gibbs to the effect that the agency no longer had it; the UKG agency confirmed that they still held this material among their records. It was sent by secure facsimile arriving on 20th November. Following a Public Interest Immunity (“PII”) application on 19th and 20th November, this material which was recovered once more and brought from the UKG agency in London, was ordered to be disclosed to the defence. It was disclosed in two forms which I will refer to as the "sanitised" version on 20th November and later the "fuller" version on 28th November. The sanitised version was as presented to me by Mr. Mitchell and the Attorney on the PII application on 20th November. It is in a redacted form – again I regret to note - the product of a redaction process entrusted to Gibbs notwithstanding all that had by then become known about his conduct in this case. The defence, with clear justification, cite this as an ongoing delegation without supervision of the prosecution’s important duty of disclosure. This is of some significance because as the defence have submitted and as I accept, this sanitised version must be seen as representing the extent of the redaction of the material which the prosecution would have intended to put before the Court, in any event.
'The basis upon which approval was sought for the disclosure of the sanitised version to the defence when it was presented upon the PII application on 20th November, was that that four page version presented a full record of contacts between and W apart from other evidence of contacts already disclosed such as SARs. Mr. Hill found reason to question this even at the very end of the arguments. That said, it must however be noted that by the time of a further PII application on 27th November, the prosecution had accepted that the fuller version should be disclosed and so it was Ordered to be and disclosed on 28th November.
'A still further form of the same material as recovered from the disc revealed by Gibbs, was later provided on 3rd December ("the disc version").
'When the sanitised version and the fuller version later came to be compared to the disc version, the considerable extent of the redactions and changes which Gibbs had carried out in late May, became discernable. Earlier redactions which even now are not fully explained from the fuller version, had been insisted upon by the UKG agency and done in London even before the material was first brought to Cayman in late May.
'It is an issue whether the redaction process as undertaken in London and by Gibbs here in Cayman in late May was intended to mislead or deceive this Court.
'Abuse of Process application
'The foregoing set of circumstances has given rise to an application by the defence for the stay of this trial on the grounds of abuse of process of the Court and unfair manipulation of the prosecutorial function by the Crown.
'Obvious questions have arisen for determination as issues of fact.
'Depending on how these are determined, I will next hear submissions and arguments as to whether the application for the stay is properly founded in law.
'The first main issue is one of mixed fact and law and is as to whether the London Plan - agreed as between the prosecution and the UKG agency for disclosure of relevant material including that relating to W's status as a witness - was acceptable or whether it was unacceptable and inherently flawed. That is the arrangement that led to material being returned from London by John Doe of the UKG and handed over to Gibbs in late May. As noted above, this issue will require an examination of the process of redaction expressly or implicitly involved in the arrangements.
'The second issue is whether Gibbs knowingly attempted to mislead this Court in the context of the currency of this criminal trial, when he issued his memorandum of 3rd July 2002.
'Related to this, will be the question whether Gibbs deliberately destroyed relevant material, knowing that it was required for disclosure in the trial, when he acted on the instructions of his UKG controlling agent, John Doe, on 2nd July 2002.
'The London Plan
'The evidence now reveals that the prosecution in the person of Mr. Mitchell was aware since August 2000, that material which was relevant to this trial was held by the UKG agency. This is material which had been sent to that agency by Gibbs as derived from his enquiries and conversations with persons in Cayman. It was sent in part electronically and in part in document form. No records or copies were retained in the Cayman Islands. This material included information provided orally and in writing by W (hereinafter the "W material"). Included in the W material was an 18 page report of his meeting of 15 March 1999 with Gibbs, as well as documents provided to Gibbs by W from within the records of the bank. An aspect of the present difficulties is that the documents disclosed to Gibbs as part of the W material are no longer identifiable as such. Apart from hard copies of Gibbs’ electronic reports kept by the UKG agency, the W. material has been destroyed.
'For reasons not fully explained and although aware since August 2000, the prosecution did not examine any of the material held by the UKG agency until April 2002 when Mr. Mitchell and Mr. Talbot were given access to it in London.
'The Attorney General also examined the material when he was subsequently given access in May. The prosecution team were then allowed to make notes of what they saw and allowed to sort it into bundles which they labelled by categories, but were not allowed to take copies from the building. Notwithstanding that all the material had originally emanated from the Cayman Islands, the UKG agency asserted ownership and control. It was in those circumstances that the London Plan for disclosure to this Court was reached by agreement with the UKG agency in May 2002. It is mainly expressed in a three-page document containing seven clauses. Statements made by Mr. Mitchell and the Attorney have provided further details of it.
'They explained that the material was examined as to whether it might contain anything relevant to these proceedings and if so whether any of that relevant material, if not to be disclosed to the defence, might be properly made the subject of a PII application to this Court.
'Mr. Mitchell has stated that the prosecution was told by the UKG agency that they would not be allowed copies of the material unless first redacted to remove all references to the agency. Acting on Mr. Mitchell’s advice, the Attorney agreed. Had he not agreed, I am told the alternatives would have been to apply in London for Judicial Review of the UKG agency's decision, or to abort this trial.
'With agreement reached, redactions were made by the UKG agency itself to meet its requirements, even before copies were released to the prosecution. This Court has not been able to ascertain the extent or full nature of those redactions.
'It has however become an even more troubling aspect of these proceedings, the extent to which the subsequent redactions made by Gibbs here, were conceived as a part of the London Plan.
'The evidence of John Doe and the statements of the prosecution proffered by Mr. Mitchell and the Attorney are to the effect that after the initial redactions to meet the requirements of the UKG agency, the material was next selected and placed into categories by the prosecution - eg: "prosecution witnesses" -; under which category the W material was placed.
'The plan was that this selected material would be taken by Doe to the Cayman Islands and handed over to Gibbs. This was done. Gibbs was then to be responsible for ensuring that it was disclosed to the defence by entry into the FRU computer database. There was however this important further rider placed upon disclosure: Disclosure was only required if the material was not already in some other form disclosed to the defence through the FRU database, such as in the form of suspicious activity reports ("SARs"). Further, even if not otherwise disclosed, the material was not to be disclosed if it was thought to be subject to PII. This outcome Gibbs was to achieve by - according to Mr. Mitchell - “replicating” the disclosable material in the database of the FRU such that it would appear that it had been kept there all along, not stored in London for the past three years and not returned from London. Quite apart from the obvious concerns whether this plan was in law or principle right, no explanation has been given as to how Gibbs was to be able, as a non-lawyer, to determine those issues for disclosure and fulfill this important duty without the direct supervision of counsel.
'Indeed, Mr. Mitchell came to admit that as the lead Counsel responsible for the conduct of the case, in retrospect he should not have left this sensitive and important duty to Gibbs, but should have checked himself to ensure that it was done.
'What is nonetheless apparent, is that some evaluative assessment of the material must have been undertaken by counsel for, on 24th May 2002, I heard a PII application brought by Mr. Mitchell on behalf of the Attorney, in respect of some of the material obtained pursuant to the London Plan.
'That application related to the material which had been categorized as “transcripts” in the London Plan but none of the W or other material described as "intelligence".
'These transcripts were held to be of only marginal relevance to the trial and protected by PII.
'This Court was not then informed about the existence of any material other than those transcripts, nor about the London Plan itself.
'The first time the London Plan was brought to the Court's attention was on 6th December 2002, in the context of a further PII application which sought leave for the disclosure only of certain aspects of it, with the three page document itself redacted to conceal the rest. This was on the basis that the rest related to the material which was the subject of the earlier successful PII application in May. Although the PII application on the 6th December was granted, it later became clear that the London Plan was itself relevant to the present enquiry and so it was ordered to be fully disclosed to the defence; (subject to minor redactions consistent with the May PII ruling).
'The document is not precisely worded. As already observed, much about it had to be explained by Mr. Mitchell and the Attorney in statements read in open Court and in answers to requests from the defence.
'Paragraphs 1 - 4 refer to “transcripts”. In the London Plan that is said to be a reference to material which all accepted had to be brought to the attention of the Cayman Court in any event.
'These I am told were the transcripts which came to be considered by me in the PII application on 24th May 2002. While it appeared to all concerned in the London Plan that that material was potentially relevant and would have to be disclosed unless PII was granted in respect of it by this Court, subparagraph 3a nonetheless appears in the document. That subparagraph expresses a concern or reservations about this Court being made aware of this sensitive material in any event. An explanation has been offered about this by Mr. Mitchell in his written response to requests for further and better particulars of the London Plan: He says that it records the UKG agency's initial concerns regarding the sensitivity of that material and whether its confidentiality would be maintained even by this Court. I am, however, told that eventually the prosecution's perseverance and insistence in this regard prevailed and it was reluctantly accepted by the UKG agency, that this material had to be brought before this Court. Mr. Mitchell urges me to take that into account in two respects. First as being indicative of the obstacles with which the prosecution were presented by the UKG agency's assertion of ownership and control over all the material.
'Second, as being indicative of the prosecution's recognition of and insistence upon the fulfillment of their own duties of disclosure. I am told they insisted that, however sensitive the material, it had to be brought to the attention of this Court if relevant or even potentially relevant to the trial. Only if this Court then upheld an application for PII, would the prosecution have been prepared to agree with the UKG agency that it might not be disclosed to the defence. That is so far as the transcripts were concerned.
'As all other relevant material including the W material was to be disclosed by Gibbs, said Mr. Mitchell, there was no need to bring any but the material for which PII was sought in May, to my attention as the trial judge.
'Equally, he insisted, there was no need to bring to my attention the London Plan itself. This meant that from the prosecution's point of view, there was then no need to seek this Court's approval for the redactions carried out by the UKG agency, nor of even more significance, any redactions which expressly or implicitly Gibbs was authorised to carry out in order to place the remaining material, including the W. material; upon the FRU database so as to give the intended impression that it had been kept there all along.
'The material upon which Gibbs was to carry out this exercise is described in paragraph 6 of the London Plan as “the intelligence” and as the "W. material" in paragraph 7.
'The extent to which these processes of redaction became an integral part of the London Plan and came to define the prosecution’s duty of disclosure under it, will be examined in more detail below.
'The exclusion of Brian Gibbs as a witness
'Mr. Mitchell has confirmed that part of the agreement with the UKG agency though not written into the London Plan, was that Gibbs was "not to be involved as a witness in the case because of his role with the UKG agency". Thus, that it was "always intended that Gibbs would not give evidence in order to protect his relationship with the UKG". It seems this was the understanding reached as far back as August 2000.
'It is now in my view established beyond argument, that because of his relationship with W, who was always seen as an important witness; Gibbs should have been regarded as a necessary witness in this case from the outset.
'As the investigating officer responsible for intelligence gathering against EBC particularly from W, leading up to the controllership of EBC and the prosecution of the defendants, it was highly likely from the outset that the would have relevant evidence to give in the trial. Equally important and obvious, because of the nature of his functions, the extent of his knowledge could not have been known to the defence without full and frank disclosure.
'The full extent of his knowledge and nature of his functions could have been known only to Gibbs. The full extent of his relationship with W. could have been known only to them. By agreeing that Gibbs was never to be a witness for the sake of protecting his relationship with the UKG agency, the prosecution shut itself out of those avenues of enquiry.
'The prosecution never did require of Gibbs a witness statement telling everything of relevance within his knowledge about the investigation.
'It has been suggested instead, that the defence could have required a proof of statement from him. Their reticence about that is more than justified as events have unfolded. Gibbs was not likely to have been forthcoming and candid to the defence.
'It is now plain from his 3rd July memorandum and interview that in his capacity as director of the FRU, Gibbs had had contact not only with the defendants, but also with witnesses while they were employees or board members of EBC.
'Apart from the misleading inadequacies of his 3rd July memorandum so far as contacts with W were concerned; (about which more below) that memorandum also failed to reveal at least one other important and specific contact. This is as between Gibbs and the defendant Cunha about an important aspect of Cunha's and 'defendant Burges' defence; relevant to the pivotal “Taves” count of the indictment.
'The decision to keep Gibbs away from this case is said to be justified by the UKG agency's insistence that his involvement with that agency was "upstream" the investigation of this case. By this, I understand it was their view accepted by the prosecution, that Gibbs' involvement with the UKG agency was extraneous of and therefore irrelevant to any issues related to the innocence or guilt of the defendants.
'This hypotheses is now shown to have been flawed in my view in at least one important respect: The fact of Gibbs' relationship with his interlocutor in London, though unknown to W, is shown in detail in the report of the 15 March 1999 to have affected the manner in which Gibbs deployed W. as a contact within the bank. Gibbs’ own involvement was thus certainly not "upstream" the investigation against the defendants and EBC.
'For instance, it is now apparent that the information which W. reported back to Gibbs about the defendants’ conduct within the bank, would have affected the investigative approach to the defendants and almost certainly the manner in which they and the bank were to be treated. This may likely even have impacted upon the prosecutorial decision.
'Thus, the decision to keep Gibbs out of the case affected not only the non-disclosure of his relationship with the UKG agency; it also impacted upon the view to be given of the true nature of the relationship between W and Gibbs and of the role they both played in this case. As a central prosecution witness W’s true involvement and role is highly relevant to the view a jury might properly take of him and the evidence he gives.
'Mr. Mitchell's response that the relationship could have been explored through W. as a witness is besides the point.
'As was to be expected, W's perception of that relationship and his ability to recollect and recount the details of the contacts, meetings and disclosure of confidential information to Gibbs, would naturally be different from Gibb’s. Gibbs was the trained policeman, investigator and intelligence gatherer. As events have transpired, W. has still not managed to reveal the full details.
'This is despite having been asked to clarify and expand on any contact he had had with the FRU during the time of his employment with EBC. This W attempted to do in his third witness statement taken in September, since this trial started. As often happens, recollections fail and W, in giving his third statement, has said on the voir dire that he simply then responded to specific questions and issues raised with him. The real mischief may well have been the fact that those questions and issues were prompted only by Gibbs’ account of the contacts he had had, as given in Gibbs’ 3rd July memorandum. This, it seems, was what guided Crown Counsel in her attempts at interviewing W to obtain W's third statement. The obvious concerns are now bourne out by the full details of W’s relationship with Gibbs and of the information he provided to Gibbs.
'In this regard, Mr. Mitchell’s admission during the arguments, that he was “astonished” at the details contained in the W. material when the 15th March 1999 memorandum was brought to his attention again on the 19th November, is very telling. That its real impact and significance must have escaped his and the rest of the prosecution’s attention when the material was categorized in London in May, I am invited to accept.
'The observation I make here is that the W. material had been selected as being relevant and to be disclosed. It should have been carefully read and considered by the prosecution. The prosecution should have ensured that it was disclosed.
'Finally at this juncture as to Gibbs’ position as a witness: The decision to allow Gibbs to inhabit the shadows without having to appear in the searching light of this case, encouraged and indeed in my view, emboldened him in his misplaced sense of priorities for his relationship with the UKG agency to the point, as the examination of the circumstances will show, of placing his own position and that of the UKG agency above his duties to this Court. And above his duty to ensure that the defendants received a fair trial.
.
Network Tweets
Network BlogsContent
provided by
|
Archive | Resources | Partners | Site Map | Links | Newsletter Archive | Contact | RSS Feeds | About | Syndication | Advertising & Marketing | Recruitment | Terms & Conditions | Privacy & Cookies
Copyright © 2012 - All Rights Reserved - Tax-News.com
IMPORTANT NOTICE: Tax-News.com has taken reasonable care in sourcing and presenting the information contained on this site, but accepts no responsibility for any financial or other loss or damage that may result from its use. In particular, users of the site are advised to take appropriate professional advice before committing themselves to involvement in offshore jurisdictions, offshore trusts or offshore investments.
Write a comment