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Friday, July 19, 2024 | Back issues
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Joint Venture Called $2 Billion Fraud

MANHATTAN (CN) - A New York-based LLC claims that a private Swedish bank made off with 1.7 billion euros ($2.3 billion) in an "enterprise" whose "anticipated" returns were 300 percent per week. Plaintiff E-Global Alliances sued E-Trust Clearing House and its managing director Robert S. Anderson in Federal Court.

E-Global says it introduced the two defendants to clients who were interested in trading financial instruments, hoping to raise capital through the "joint venture" for its own projects.

E-Trust was to use the 1.7 billion euros in loans to trade on international money markets, but conspired not to make the payoffs, which were due in September 2009, according to the complaint.

"it was anticipated that the enterprise would return 300 percent per week," the complaint states. E-Global and E-Trust were supposed to split 60 percent of the immense profits equally, with the other 40 percent going to (nonparty) Uniti Capital, of Canada, to whom E-Global had introduced E-Trust.

"Although the transaction is under way, no funds have been transferred to the attorney trust account and EGA has therefore not received any portion of the profits to which it is entitled," according to the complaint.

E-Global says its managing director Richard Yaha asked Anderson in December 2009 why no money had been received in the attorney trust account.

"Anderson explained that [Uniti managing director Louis] Muro had closed the Uniti trading account and had fled with the funds to Italy," according to the complaint.

It adds: "Yaha's requests to Anderson for the transaction codes related to the leverage of the bank guarantees, and Yaha's attempts to communicate with Anderson regarding the status of joint venture funds, have been met with silence."

E-Global says E-Trust claimed that its corporate attorney was Lonnie D. Collins with Collins, Hensley and Wynn of Madison, Ind., but that Collins says he is not representing E-Trust in the joint venture.

"Anderson's false statements and concealments on behalf of himself and of ETCH were made with the intent that Yaha and plaintiff would not find out about defendants' theft of millions of dollars from plaintiff so defendants could perpetuate their fraud against plaintiff on a continuing basis, which continues to this day," according to the complaint.

E-Global seeks an accounting, 1.72 billion euros in compensatory damages, and $1 billion in punitive damages for fraud, breach of contract, breach of fiduciary duty, bad faith and conversion.

It is represented by A. Jared Silverman of West Orange, N.J.

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