The Royal Court of Jersey has dismissed outright the case brought against Nedbank’s Jersey bank and trust management divisions by 84-year-old widow Dorothy Brakspear and her two adult children, Ian and Alison, in their capacity as beneficiaries of two offshore trusts set up and managed by the banking group.
In a shocking judgment that seemingly shamelessly ignores the facts and covers and condones the banking group’s misdeeds and mismanagement, the Jersey court granted the banking group’s application to have the Brakspears’ Order of Justice (Jersey’s equivalent of a summons with particulars of claim) struck out, without the case having to go to trial for the hearing of evidence.
The facts are so elaborate and the arguments so convoluted that it would have taken more time than was available to compile an intelligible report for this issue of Noseweek.
Suffice to say, at this stage, the Jersey court struck out all the Brakespears’ claims either because they had allegedly prescribed (were out of time) or the issues had already been adjudicated upon by a South African court – which found the Nedbank trustees and bankers’ actions to have been truthful and correct. The Jersey court ignores all the evidence that the Brakspears produced which supports their claim that Nedbank repeatedly produced false evidence under oath to achieve a fraudulent outcome.
A central example involving both these legal issues:
Readers will recall that Ian Brakspear sold the farm – which had been partially funded with money originating from the family’s offshore trusts – in a very profitable deal, for R37 million. But the deal fell through when the Nedbank Jersey trustee carelessly let the buyer know that it was a distressed sale. Taking advantage of this information, the buyer pulled out and waited for the inevitable emergency auction that did in fact follow – where the same buyer again bought the farm, for just R18m.
Nedbank representatives admitted that their trustee had been recklessly negligent, but argued that Brakspear should have sued for the R19m damages suffered as a consequence within three years of the event.
The court agrees, ignoring all the evidence produced by the Brakspears to show that the damages claim accrued to the company that owned the farm, not the Brakspears directly. And that the trustees had contrived, by means of a false claim, to fraudulently put the farm company into liquidation, thus disabling it from claiming the damages in time. (The liquidator was beholden to the Nedbank trustee – fraudulently set up as the largest creditor.)
While the Brakspears already had several reasons in 2008 to believe that the claim advanced by the Nedbank trustees to justify the liquidation was false, incontrovertible proof only became available earlier this year when they were granted access (by another judge) to the Jersey trust’s banking records – and when they found relevant documents amongst the leaked so-called Panama Papers. The Jersey court chooses to ignore all this evidence.
Many readers might find my negative assessment of the Jersey court outrageous. Why would a Jersey court brazenly want to cover for a bank over a plaintiff who has so clearly suffered great injustice?
Some passages from the Tax Justice Network’s recently published Financial Secrecy Index 2018, and in particular the section titled “Narrative Report on Jersey” should explain why that might be, and help clarify some of the issues at stake.
Jersey is ranked at 18 position on the 2018 Financial secrecy Index. [It] has been assessed with 65.45 secrecy points out of a potential 100, which places it at the lower level of what might regarded as the ‘extreme danger zone’ for offshore secrecy.
Despite its tiny size (population 100,000,) Jersey trusts are reported to control an estimated £1 trillion (R17,000,000,000,000) in assets, with
£400 billion in private trusts… Anecdotally, Jersey practitioners are on record as having said that “over 90% of their business concerns discretionary trusts” – recognised as highly problematic and open to abuse.
Six of the nine offshore law firms identified as being members of the so-called “offshore magic circle” operate in Jersey…
With its oversized financial services sector, Jersey is politically captured by offshore finance. The island’s political and judicial arrangements are peculiarly unsuited to hosting an offshore financial centre, lacking the necessary separation of authority between judiciary and legislature, and with wholly inadequate independent political oversight of the financial services sector. In 2017 an inquiry into child abuse going back over 50 years revealed a culture – known locally as “the Jersey Way” – that inhibits independent thought, scrutiny and accountability.
This is an island culture with little respect for the laws and mores of other countries and generally subservient to ‘enterprising merchants’ engaged in criminal activities.
In 1998, then New York assistant district attorney John Moscow was quoted saying: ‘The Isle of Man authorities see their job as keeping the bad guys out. Jersey sees its job as co-operating with the criminal authorities when the law requires it – without necessarily keeping the bad guys out.’
There is little indication that the authorities are willing to require basic information about settlor and trustee information to be made public.
“…the revelations in 2017 on child abuse… at a more profound level… shines a spotlight on an island culture that enforces conformity, tolerates official perjury, ignores the perversion of the course of justice, allows extensive conflicts of interest throughout the judicial and political systems…. This culture flies under the name the “Jersey Way”.
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