wmlro.com - Jersey money laundering defendant alleges "racial discrimination."

What is so far unclear is precisely why the Nigerian armed forces needed a middle-man to negotiate a deal with TATA, one of India's largest corporations. It's exactly the kind of purchase that the military, knowing exactly what it wants and how to specify it, should have been perfectly able to place itself through direct procurement channels.

The deal, in 1996, was for a total of just over USD180 million. But Nigerian authorities began to investigate the deal. In or about October 2000, it is alleged, Bhojwani transferred USD44 million out of Nigeria and into the Bank of India in Jersey.

Bhojwani's lawyers have released a series of statements, picked up by a single Indian media outlet, Press Trust of India, but largely overlooked elsewhere, in which they make a series of claims.

One, if it is true, displays a disturbing lack of understanding of money laundering laws on the part of the Nigerian government: the lawyers claim that, on 29th December last year, the Nigerian government (the department concerned is not mentioned) wrote to the British High Commissioner in Abuja saying that Jersey has no jurisdiction over Bhojwani because the contract and the alleged offences took place outside Jersey and that there was no contact with Jersey "except that he maintained his accounts in Jersey and routed his payments through those accounts."

But under both Nigerian and Jersey law, the principle of "commonality of offence" operates. Under that principle, says Nigel Morris-Cotterill of The Anti Money Laundering Network (the ultimate parent of BankingInsuranceSecurities.com) the situation is clear: "if criminal conduct is committed in country A and the proceeds laundered in country B then, provided the conduct would have been an offence if committed in country B, a laundering conviction can be sustained in either country A or country B. If the letter is genuine, then the person who wrote it clearly did not do proper fact-checking with the Nigerian FIU, the EFCC. Had he done so, the only advice which could have been given to him is that his premise was wrong."

Bhojwani is charged with three offences, one of which is that the funds were moved to avoid a prosecution or confiscation order - that's the essence of money laundering, says Morris-Cotterill and money laundering is an offence in both Nigeria and Jersey. It is not necessary for the wording of the offences to be identical. Further, says Morris-Cotterill "money laundering is a predicate offence for money laundering purposes, so a money laundering prosecution can be sustained without the need to prove the original offence, merely the subsequent laundering. Few people recognise that but it is clear in the law of both countries."

Bhojwani is reportedly trying every way his lawyers can think of to get the trial stopped: it is claimed that Bhojwani has been "unlawfully detained" in Jersey and as a result, they have written to Monmohan Singh, India's Prime Minister and his External Affairs Minister SK Krishna. The plan is, reportedly, to get the Indian government to try to move the case from India to the International Court of Justice "to ensure a fair trial." This, too, is a deeply flawed argument for the ICJ, as an organ of the United Nations, is "to settle, in accordance with international law, legal disputes submitted to it by States and to give advisory opinions on legal questions referred to it by authorized United Nations organs and specialised agencies." It is emphatically not a venue for disputes between individuals and a state and it is not an alternate venue for criminal procedings. It does deal with matters relating to extradition.

The hook for the asked-for reference to the ICJ is an allegation that Jersey is racially motivated in its actions against Bhojwani: the ICJ does deliver opinions on Conventions including The International Convention on the Elimination of all forms of Racial Discrimination." Bhojwani claims he is being picked on because he is Indian.

The Nigerian government letter is also said to claim that Jersey's evidence against Bhojwani was obtained unlawfully and to request that the case be transferred to Nigeria for trial.

Next, it is argued, that Jersey is seeking to give retrospective application to laws, including the civil confiscation regime which came into force in 2007. Again, says Morris-Cotterill, this is flawed "money laundering is a continuing offence. If a person launders today the proceeds of yesterday's laundering, then it's a current offence. Very few people realise that this is not retrospective effect even though it allows the court to reach back to the proceeds of criminal conduct committed before the effective date of not just confiscation laws but counter-money laundering laws themselves. It is an extremely potent provision that over-rides even specific statutes of limitation where they exist in relation to criminal cases."

Bhojwani was arrested in London on 8 February 2008 and taken to Jersey the next day.

The case was expected to start in May 2008 but in fact started on 26th January this year.

Bhojwani, it turns out, owns (or owned) a Nigerian company called TATA Sales and Services SA. It is alleged, in Nigeria, that there were, in fact, two orders - one valued at USD149 million and one valued at USD29 million, in August 1996 and August 1997 respectively. It is alleged that the orders were placed by or at the direct instigation of General Abacha, then the military president of Nigeria and famous for stealing money from the country. An investigative journalist in Nigeria publishing in SaharaReporters.com, alleged that there were a number of payments relating to those contracts including one to the account of Ocean Queen Universal Corporation with Canadian Imperial Bank of Commerce in Geneva and another to the account of Ashar Limited with Trans-National Bank in Nairobi, Kenya. The report alleges that that bank was owned or controlled by the family of Daniel Arap Moi who has been widely implicated in Abacha's laundering schemes. A further account with CIBC Bank and Trust Company in the Cayman Islands was also identified - the account there was said to be in the name of Tiger Investments Limited and no beneficial owner designated.

Other banks alleged to have been connected with the deal are Bank First, Oklahoma City (account: Insured Escrow Service re Albarka Airlines - Alhaji Muhammed Buba), various banks holding accounts in the name Whitewhale Investments and Ethel Finance Inc, Private Investment Bank Ltd, Nassau (account Mohammed Buba with the code name 301260 LEOPARD).

Several of these accounts were set up by or at the direction of Colonel MB Marwa, whose involvement came to light when Jersey asked the Cayman Islands for mutual legal assistance in its investigation into Bhojwani.

The deal, it is alleged was for the delivery of 1,500 vehicles for the armed forces and the police. But the armed forces received only 751 and the police "about" 285. The prices were, it is alleged, inflated so that there was a double hit - high prices and short delivery - under the contract.

Central to much of the money movement was one MB Marwa. Coming under investigation by the EFCC, he wrote to Abacha's successor, Obasanjo, confessing to a corrupt deal and money laundering, claiming that he had no choice but to do as he was told because he was a serving officer in the military. The EFCC also identified, it is alleged, a transfer of USD17 million by Marwa from the Nigerian UN mission in New York to a private account held by Abacha in Kenya.

The investigative journalist produces what he says is an extract from an EFCC report which says ""He must have known too well that the money went to Abacha’s private account for his personal benefits. It became more glaring and incriminating since Buba Marwa himself has benefited from the proceeds of this crime. This is because the accounts from where some of the laundered proceed rested in the Cayman Island turned out to be what was used to finance the establishment of Albarka Airlines under a shabby loan arrangement which no repayment has been made to date."

Jersey wants to confiscate the money and to enter into a sharing arrangement with the government of Nigeria. So far, Nigeria does not appear to have sought to trace the funds into the Bank of India's hands and secure it all as proceed of corruption.