Andrew Mitchell QC
On Wednesday, day twelve of his opening statement on behalf of the prosecution in the criminal trial of former Turks and Caicos Islands (TCI) premier Michael Misick and others on various corruption and money laundering charges, Andrew Mitchell QC continued summarising a resort development on East Caicos, a comparatively remote, under resourced and undeveloped island.
The developer in this case was Richard Padgett, a citizen and resident of the United Kingdom and, according to Mitchell, the important piece of land in this transaction is known as Breezy Point, covering about 92 acres. On 24 January 2005 there was an agreement to sell that land to Padgett, notwithstanding that at that point there were three competing interests in this area.
The sale of the land to Padgett was confirmed by an “Agreement of Sale” between the TCI government and Padgett dated 24 January 2005, signed by then Governor Poston for the government and Padgett on behalf of himself trading as Caicos Sol Ltd.
The stamp duty due on the sale was waived by ministerial decree issued by former deputy premier Floyd Hall. The value of the stamp duty lost to the TCI government by this ministerial decision was over $200,000, Mitchell pointed out.
“If a minister makes a proper decision to remit stamp duty pursuant to statute, that can be a properly sensible and compliant decision – he is empowered to do so. But if, on the other hand, the decision is made because of a relationship that has developed between the politician and the purchaser … then that is a factor the court takes into account. The authority to remit stamp duty is a power contained in statute that needs to be exercised in compliance with the ministerial code and with integrity. It needs to be done responsibly, and because it is justified in the context of the transfer. If there is evidence that it is being done because the person who benefits is in a secret financial relationship with the minister, then that casts it in a different light,” he continued.
On 25 February 2005, Padgett paid $200,000 into the Progressive National Party (PNP) account. $150,000 of the $200,000 was immediately transferred in the form of a cheque from the PNP account to the Belize Bank.
On the same day $100,000 of this money was transferred to Michael Misick’s Belize Bank account and $50,000 was transferred to Floyd Hall’s personal account.
“The position is that of the $200,000 sent, $150,000 is taken straight out and goes to [Floyd Hall] and [Michael Misick]. We remember that this is around four weeks after [Floyd Hall] issued the remission for the stamp duty,” Mitchell said.
However, Padgett purchased Breezy Point without conducting a survey and access across other land was potentially restricted.
On 7 February 2006 Floyd Hall wrote to Padgett stating that at a meeting of Executive Council (ExCo) on the 2 November 2005, it had been agreed that an easement would be granted. The minute reveals that the issue was raised by oral mention. It did not record that the person affected was Padgett and did not include the references of the parcel.
The way that it was presented to ExCo was that this was an oversight by government and that an easement should have been registered earlier.
“So in the end [Padgett] gets his easement, he gets the land at Breezy Point, he buys the land for $4.2 million and he doesn’t have to pay stamp duty. Other developers, one of whom was keen to go ahead and was funded, lose out. [Padgett] makes a payment to the PNP, three-quarters of which are distributed to [Floyd Hall] and [Michael Misick],” Mitchell concluded.
He then turned to the Third Turtle Club, a proposed development of land in Turtle Cove, Providenciales, purchased by Padgett from the Omani Royal family for $6 million in March 2004.
On 8 August 2005, Padgett applied to the Physical Planning Board for permission to erect buildings above five storeys in height. On 3 October 2005, this application was refused. On 11 October 2005, Padgett lodged an appeal against the Board’s decision.
On 14 December 2005, Floyd Hall acting as chief minister in the absence of Michael Misick, in the face of objection from adjoining landowners, allowed Padgett’s appeal.
On 7 February 2006, $250,000 was transferred by Padgett’s company to the account of Paradigm Corporate Management, a TCI-registered company owned by Floyd Hall that the Crown allege was used by him to channel corrupt payments.
“There was an invoice in relation to this credit which we can see here dated 6 February 2006, it references [Third Turtle Club] property, negotiation of the purchase of the freehold development, success fee relating to the accomplishment of outline planning permission and the appeal against the determination of the [Physical Planning Board] – fees due as per heads of term of engagement letter, $375,000,” Mitchell noted.
On 14 February 2006, $125,000 was transferred from Padgett to Paradigm’s account, with the reference ‘Third Turtle Club, Providenciales’.
By 14 February 2006 therefore, Padgett had transferred $375,000 ($250,000 and $125,000), the amount of the invoice, to Paradigm’s account.
“As blatant, we submit, an attempt to disguise a payment to ministers as one might see,” Mitchell said.
Following further interaction between Padgett and government ministers in relation to the land at Breezy Point, on 27 March 2006 Padgett paid $75,000 to the PNP account at Belize Bank.
On 11 December 2006, Padgett paid $100,000 to the PNP account at First Caribbean International Bank and, on 24 January 2007, a further $125,000 was paid to the same PNP account by Padgett.
On 17 July 2007, Floyd Hall sent an email to Padgett under the subject of ‘Loan’. In that message Hall officially requested a loan that had previously been discussed. Hall stated the funds used would be to assist his brother but he would undertake responsibility to make full repayment.
“We make an observation about the ministerial code, about ministers declaring if they have a financial relationship or interest with anyone who may be doing business with the Crown, and we highlight that this was something which was not known to the government,” Mitchell said.
On 17 August 2007, Padgett made a payment of $200,000, through Miller Simons and O’Sullivan to the account of Stanfield Greene with the description ‘MM Loan – MA’.
The payment was credited to the client account maintained by Stanfield Greene in the name of Whale Watchers Limited, a company owned by co-defendant Clayton Greene but also associated with Floyd Hall and his brother Quinton Hall, another co-defendant.
“Whale Watchers was a front, we suggest, for [Floyd Hall],” Mitchell said.
According to Mitchell, these payments were intended to act as inducements for the ministers to act in a way inconsistent with their duties.
He then turned to another proposed development on South Caicos, an island of just eight square miles with an estimated population of 1,500.
However, from a straightforward development agreement between the TCI government and the developer, a group of ten Belongers was inserted into the process.
$900,000 was to be paid to the Belonger shareholders upon the signing of the development agreement and the transfer of the initial tranche of Crown land, with a further $100,000 when the remainder of the Crown land was transferred.
On 18 April 2008, a bankers draft for $900,000 was sent from the developer to the client account of Chalmers & Co.
On 30 April 2008, ten cheques, each for $50,000, were drawn on the Chalmers & Co account, payable to the Belonger shareholders.
As to the remaining $400,000, Mitchell said this appears to have been utilised by co-defendant Thomas Chalmers Misick for the benefit of people not connected with the transaction.
“We can see some of the conspirators at work using Cabinet and their ability to influence decisions to make [the TCI government] a victim of future loss. The money laundering is plain – the $900,000 is not the product of any honest transaction but was a means of getting money that was applied for the benefit of [Thomas Chalmers Misick], and also used to pay off unsuspecting Belongers,” Mitchell said.
The full day’s text of the opening statement on behalf of the Crown may be found here: http://tci-sit.org/category/opening-notes/