SERVICES

Fraud Investigation and Recovery

Warden Consulting has been involved in the investigation of domestic and international fraud cases over the last 10 years with losses to clients totalling in excess of NZ$2 billion. Funds have been recovered and bank accounts frozen in New Zealand, Australia, United States, Austria, Switzerland and Hungary.

The company has conducted investigations regarding domestic frauds totalling millions which have resulted in the successful granting of Mareva Injunctions by the Auckland High Court.

Senior defence counsel have referred to Warden Consulting to undertake inquiries in significant Serious Fraud Office prosecutions.

Fraud Investigations Have Included:

The investigation of a $30 million fraud in Sydney, this fraud operation being a fraudulent equities and futures trading operation. This also promised high returns approaching 100% return. This involved extensive inquiries with receivers and bankers to gather information establishing clearly what had occurred.
Recovery of $900,000 of a $1.25 million corporate fraud perpetrated in Wellington. The recovery was achieved through negotiations with the offender and liquidation of assets.
A fleeing offender involved in fraud upon finance companies was tracked through Australia and subsequently interviewed in South Australia. By negotiation, 90% of the funds lost were repatriated to the victim financial entity within three days of the loss being disclosed.
Warden Consulting personnel were deployed on the investigation of a USD500 million loss on a Swiss bank. This involved steps in Thailand, Malaysia, Switzerland and London. It resulted in a successful negotiated recovery and the subsequent arrest of the offender.
Warden Consulting has given advice in terms of international fraud mitigation which involved liaising with financial entities in Geneva, Switzerland, examining proposals and providing appropriate advice.

Read more about particular cases:

First Equity Enterprises Inc and Evergreen International Spot Trading

This task involved the representation of 322 clients from 30 countries in respect of the loss of USD100 million. The funds were lost as a result of a Russian organised crime fraud operation based in New York. The operation was a traditional “boiler room” in which high net worth individuals from around the world were targeted to invest with the promise of high returns.

Pressure was put on the fraud operation as a result of the September 11th attacks in New York. There was a virtual mini run on the funds as the fraud operation was based in the Twin Towers and another address in New York.

The matter came to light and Mark van Leewarden was instructed in conjunction with Warden Consulting as a result of funds disappearing from a Bank of New Zealand bank account in Auckland. Immediate steps were undertaken to track the NZD2.35 million. It was quickly ascertained the funds had been transferred to Switzerland.

Immediate steps were taken and Mark van Leewarden travelled to Switzerland on 7^th October 2001. He then took steps to freeze funds in a BNP Paribas account in Geneva by virtue of a private Seizure Order.

The Seizure Order from the Swiss Court of Justice was dated 11^th October 2001 as an order from Prosecutor Jean-Bernard Schmidt to BNP Paribas Private Bank (Suisse) SA to freeze the funds on behalf of our client group.

It was subsequently established this account contained USD4.7 million. It was also established that the following day one of the offenders in the boiler room, Gary Faberov, attempted to shift these funds from the account. In the absence of the Seizure Order, Mr Faberov would have been successful. The account was held in the name of Exista Foundation, Gary Faberov and Andre Koudatchev.

Further steps were taken to seize accounts in the name of Buxusa and Raft Foundation. These accounts were subsequently shown to hold approximately AUD1 million. On a number of visits to Switzerland, London and Australia the worldwide investigation and recovery steps were co-ordinated.

Although we had frozen the funds on behalf of our client group, the US Government subsequently took steps by virtue of a Mutual Legal Assistance request from the United States to the Swiss Government to seize the funds. As a result a directive to the Bank resulted in the funds being removed and forwarded to the United States. This occurred without the knowledge of the Swiss Judge who froze the funds on our behalf and was done by BNP Paribas management. The issue arose as to how this could occur with a Seizure Order by us already in place. The legal argument therefore is which order ranks in priority – the private Seizure Order or the Mutual Legal Assistance request. It was determined that no steps should be taken as the funds are now in the US and available for distribution. It is expected that the pro rata proportion of the EFIRG client group, which accounts for some 70% of the worldwide losses, will be forwarded in one lump sum for distribution in New Zealand.

The primary offender in this matter, Andre Koudachev, is known to be somewhere in Russia. The other offenders have been sentenced as a result of criminal proceedings brought by the US Attorney’s Office.

Inquiries were undertaken with the regulatory authorities including the OC of the Vienna Police and the Budapest Organised Crime Unit resulting in the freezing of two bank accounts in Vienna and a further three accounts in Budapest.

Scrutiny was undertaken and evidence gathered regarding the potential liability of banks both in Australia and the United States.

See Media for press associated articles.

Sheridan Leslie Cox

Mark van Leewarden and Warden Consulting were instructed to represent New Zealand and worldwide groups with respect to the fraud offending of Sheridan Leslie Cox. This person is a renowned worldwide fraudster believed to have benefited illegally in the amount of USD400 million. He has also operated “boiler room” fraud operations worldwide including in Europe, Thailand and Taiwan. Steps were taken concerning the Mendes Prior fraud operation run from Thailand and as a result Cox was arrested on passport charges travelling into Taiwan.

On a number of occasions negotiations were undertaken with Cox whilst in custody in Taiwan with a view to a recovery for New Zealand victims and European victims of the fraudulent enterprise.

Part of the negotiation process involved dealing with the Minister of Justice in Taiwan to try and facilitate the process. This process was assisted by the New Zealand Government through the Hon. Peter Dunne who attended the meeting. Further steps with other victims were undertaken in South Africa, Hong Kong, London, Singapore and Malaysia.

See Media for press associated articles.

Derek Turner

Mark van Leewarden and Warden Consulting have acted on behalf of New Zealand victims of a fraud scheme undertaken by Derek Turner, an ex-pat New Zealander. Turner commenced his operation in Australia before moving to the Bahamas. This was an investment system promising high returns and was advanced to victims on the basis of a broking operation. New Zealand victims lost some $2 million. Turner was subsequently apprehended by an FBI undercover operation and is currently serving 20 years imprisonment in a US jail. The assets accumulated as a result of his fraud schemes in Australia and the Bahamas are currently being liquidated with the proceeds distributed to victims.