King to know extradition fate on March 25

By Observer News - Tuesday, January 26th, 2010

The former head of the Financial Services Regulatory Commission (FSRC) will know in two months if a magistrate will order his extradition.

If extradited, Leroy King will travel to the United States to face charges for his alleged involvement in a US $7 billion Ponzi scheme believed to have been orchestrated by investor Sir Allen Stanford.

King is accused of 10 counts of conspiracy to commit mail fraud, seven counts of conspiracy to commit wire fraud, conspiracy to launder illegal proceeds and conspiracy to obstruct the Securities and Exchange Commission (SEC).

Yesterday, Chief Magistrate Ivan Walters heard submissions from Director of Pubic Prosecution Anthony Armstrong and King’s lawyer, Dane Hamilton, QC, before saying he would announce his decision on March 25.

Hamilton spent over an hour outlining his position to the court. He said his client should not be held accountable for the alleged fraud, as the Stanford International Bank Ltd (SIBL) “operated in an environment in which the laws were lax on how an offshore bank should operate.”

The attorney said King, as the FSRC administrator, did not have a direct hand in scrutinising the reports and balance sheets of the various offshore banks.

“He had never been the Supervisor of Banking,” Hamilton said. “He was never responsible for any examination of any account.”

The senior attorney also added that King was not involved in any cover-up with Stanford, as the charges suggest.

“It cannot be said and should not be said that Leroy King did not cooperate with the SEC (Securities and Exchange Commission),” Hamilton said, as he explained that his client offered to host a meeting between SIBL officials and American regulators after receiving correspondence from the SEC.

“Leroy King had gone beyond the remit of his office to cooperate with the SEC,” he added.

However Director of Public Prosecutions (DPP) Anthony Armstrong disagreed. He contended that King was, in fact, responsible for regulating the offshore banks.

He pushed his case, arguing that the timing in which King proceeded to withdraw funds from his US accounts was cause for concern. According to Armstrong, the withdrawal of money had to be viewed in the context of what was happening at the time.

He upheld a similar view when he noted a series of deposits that were made to Chase Morgan accounts and questioned the timing in which those sizeable deposits stopped in February of last year.

During the course of his submissions, the prosecutor contended that King and Stanford were very good friends and that he, from time to time, produced reports that indicated SIBL was solvent and in good standing.

Should the magistrate order King’s extradition, the former FSRC boss would have the opportunity to file an appeal in the High court.

King remains on house arrest and will continue to report to the St John’s Police Station twice daily, accompanied by one of his two sureties.