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The First International Bank of Grenada is one of the crudest ever examples of financial crime.
In a nutshell, a former bankrupt - Gilbert Allen Ziegler - with no prior banking experience, no money and a 'passport' issued by a country that does not exist - Melchizedek - was allowed to capitalize a bank by a photograph of a ruby the bank did not own
or possess and take in more than $100 million of deposits by offering annual interest of up to 250 per cent that was "guaranteed" by a sham insurer incorporated in a jurisdiction - Nevis - that does not even license offshore insurers.
Among those who participated in the scam, either knowingly or due to naiveté, were Azie Taylor Morton, who was the 36th Treasurer of the United States, appointed by former President Jimmy Carter, and Professor John Hogan, the Director of Material
Science at Beth Israel Deaconess Medical Center, which is attached to Harvard University.
Both Morton and Hogan were directors of companies which listed shares on FIBG's sham Internet stock exchange, known as the World Investors' Stock Exchange, which promised stock investors that they would make money even if the company in which they bought
shares collapsed - due to something WISE called a 'Stock Value Bank Guarantee'.
One of the saddest parts of the FIBG scandal is that both OffshoreAlert and FIBG's initial auditor, Grenada accountant Lauriston Wilson, exposed the bank in early 1999 - long before it took in most of its funds and approximately two years before it went
into liquidation.
In return for pay-offs, Grenada's government allowed FIBG's controllers to do as they pleased.
The island's then chief offshore regulator, Michael Creft, took an active part in the crime. He even swore an affidavit in favor of FIBG that the bank submitted to Federal Court in Miami, Florida in February, 1999 as part of its failed application for
an injunction to prevent OffshoreAlert from continuing to expose its fraudulent activities.
While he was a regulator, Creft doubled up as a "private consultant", soliciting and receiving fees from the island's banks. He left office in 2000 and began overseeing the construction of a new home in a desirable area of Grenada with access
to its own private beach.
Incredibly, shortly before FIBG went into provisional liquidation in January, 2001, the Grenada government granted a new banking license to the same people who were seeking to operate the same scam all over again. It typified their lack of shame over the
misery that they had caused around the world.
Grenada passed its Offshore Banking Act in 1996 and licensed its first offshore bank, Grenada International Bank & Trust Corp., on April 15, 1997. GIB&TC, which was controlled by habitual U. S. conman Alfred Zent and a 'nun' known as 'Sister' Susan
Walsh, actually collapsed in scandal before it even officially opened for business.
Grenada's foray into offshore banking is reminiscent of another Caribbean island, Montserrat, most of whose 300 or so banks were closed down in 1989/90 due to fraud.
At its peak in or around 2000, Grenada had licensed approximately 40 offshore banks. By May, 2003, virtually all of them had collapsed or been closed down with estimated losses of several hundreds of millions of dollars owed mainly to North American depositors.
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