Asean Holdings Inc - Street Wire Asean's Saxena confirms Possino in Austrian fiasco
Asean Holdings Inc
AHI
Shares issued 15,750,552
Thu 21 Feb 2002 Street
Wire
by Brent Mudry
A key player behind Raoul Berthaumieu of Belgium, the front man in
the
fraudulent $1-billion collapse of General Commerce Bank SA in Austria
last
year, was Regis Possino, a disbarred California lawyer who has
been
especially active in controversial penny stock promotions in recent
years.
(All figures are in U.S. dollars.)
According to a lawsuit filed this week in Vancouver, one of
General
Commerce Bank's most notable victims was fugitive Thai financier
Rakesh
Saxena, an alleged key player, along with close associate Adnan
Khashoggi,
the former Vancouver Stock Exchange player, now Paris-based
Iran-Contra
arms merchant, in the fraudulent $2-billion collapse of Bangkok Bank
of
Commerce in 1996.
Mr. Saxena, who claims he lost $10-million in the Austrian bank fiasco,
is
not known for being taken in by frauds of any size. "This is the first
time
it has happened to me," he told Stockwatch. The fugitive
financier,
arrested at Whistler in July, 1996, three weeks after his presence in
the
Vancouver area was revealed by Stockwatch, remains under house arrest
in
Vancouver as he appeals his order of extradition back to Thailand.
Everything looked fine up front at first, according to Mr. Saxena.
"This
guy calls me from a bank in Austria ... I look and see it's in the
banker's
almanac."
Mr. Saxena points out that Austria's banking industry generally has a
good
reputation, and "anything which smells German" usually gives
comfort in
international high-finance circles.
Unfortunately, although Mr. Berthaumieu, alias Lee Sanders, posed
as
General Commerce Bank's chairman, he was not really in control,
according
to Mr. Saxena. "It appears from day one he did not have signing
authority."
Mr. Berthaumieu boasts a credential few bank chairmen possess: a
1991
conviction in Los Angeles for felony bank fraud for writing
$1.6-million in
rubber cheques. The bogus banker was bounced from the United
States in
about 1999, when he was deported to Belgium, his country of birth,
although
he is believed to be a Canadian national, formerly from Hamilton, Ont.
The Thai financier Mr. Saxena, an Indian national, points his finger
partly
at Austrian banking officials for the General Commerce Bank mess. "I
blame
the Austrians. If it was in the Caribbean, you can blame me," says
Mr.
Saxena, noting one does not expect banking frauds in Austria.
While any such loss for a man of Mr. Saxena's stature is disappointing
and
even embarrassing, cushioning the blow is the fact that he lost paper,
not
$10-million of cold hard cash. "I lost a lot of stock. I lost three or
four
million shares of companies I had investments in, not
companies I
controlled." While the victimized financier did not identify these
three or
four companies, he notes he had invested in some of the companies
for
anywhere from two to eight years. The shares were assorted,
including a
quantity of restricted shares.
Mr. Saxena also confirms Regis Michael Possino, who operates out of
Santa
Monica, Calif., was a major behind-the-scenes player at General
Commerce
Bank.
Mr. Possino is one of those colourful characters who suffer
misfortune
after misfortune, but keep bouncing back in big-league cases. The State
Bar
of California disbarred him about 17 years ago, just because of
his
entrepreneurial moonlighting in the marijuana industry, which it
called "a
crime involving moral turpitude," and a few other youthful
indiscretions.
Mr. Possino wasted little time making a name for himself after
being
admitted to the bar in 1972. A mere four years later, in 1976, he
was
privately rebuked for wrongfully causing an employee to make a
false
notarial declaration.
This was peanuts, however, compared to his antics in 1975. In November
and
December of that year, the budding young lawyer attempted to sell
some
marijuana to undercover Los Angeles police officers, a mere 350 pounds
of
the weed. In November, Mr. Possino had offered to sell 1,000
pounds, or
half a ton, of pot to the officers, but they suggested they could
only
handle a smaller amount. During several meetings over the following
few
weeks, Mr. Possino negotiated the deal, delivered samples of
his
merchandise, and calculated that his profit on 350 pounds would be
about
$38,500, which is not bad pay for a struggling young lawyer.
Once Mr. Possino had his buyers on the hook, he sought to up the ante
and
diversify his merchandise. During the marijuana negotations, he
sought to
buy some cocaine from the undercover officers. "He told the officers
that
he was an attorney and was acting on behalf of several groups who
could
purchase eight to 10 kilograms of cocaine twice a month at a price
of
$34,000 per kilo. However, these negotiations ended when one of
the
undercover officers said he would not be able to obtain any cocaine
until
Christmas," states a disbarment document filed in the Supreme
Court of
California.
While these dealings might sound ambitious enough, this was just
the
beginning.
At one of the meetings, Mr. Possino offered to sell $5-million worth
of
stolen treasury bills or bearer bonds to the undercover agents.
"At a
subsequent meeting, the officers brought along an undercover agent of
the
United States Treasury Department, introducing him as a cousin of
one of
the undercover narcotics officers and a dealer in stolen
securities,"
states the document.
Although Mr. Possino and the treasury agent negotiated a purchase price
of
20 cents on the dollar, the young lawyer never came through with the
goods,
and later told the agent he had negotiated a better price with
another
buyer. Through this big-league negotations, Mr. Possino represented
himself
as an attorney and produced identification as a deputy or former deputy
of
the Los Angeles District Attorney's office. (He was a former deputy by
this
time.)
While everything seemed to be going well, Mr. Possino had little
to
celebrate that Christmas. He was arrested on Dec. 23, 1975,
while
attempting to deliver the first shipment of 50 pounds of marijuana to
the
undercover officers, and charged on four counts. Mr. Possino, who was
just
27 years old at the time, took a self-imposed holiday from the
legal
profession in 1976 and 1977.
After his arrest, Mr. Possino was released on his own recognizance
pending
trial. At trial, in late 1977, he was convicted on one count, but
his
troubles were not over.
One evening during the trial, Mr. Possino bumped into one of the jurors
in
a restaurant, where she was waiting for a table. While most lawyers
and
defendants would at least try to play shy, not Mr. Possino. He walked
up to
the juror, started chatting with her, and ended up buying drinks for
her
and her friends.
Mr. Possino asked the juror what she thought of the prosecutor.
Although he
stopped short of talking about the merits of the case, Mr. Possino
also
talked to the juror about himself, others involved in the trial and
the
judge. Once he learned the juror was a religious person, he
began
discussing his own religious beliefs with her. This little chat ended
when
the juror and her companions were called to dinner.
After mulling all this over and digesting her dinner, the
religious
California juror decided she could not stomach what had just gone down.
She
approached Mr. Possino, told him she was upset about their chat, and
said
she felt it was improper. Mr. Possino told her that whatever she did
would
be "all right" with him. Soon after, she reported the restaurant
encounter
to the judge and was excused from the jury.
The trial judge told Mr. Possino his behaviour amounted to contempt
of
court, as he has indirectly attempted to influence her and had violated
his
ethical obligations as a lawyer. The judge revoked Mr.
Possino's
recognizance release, locked him up for the rest of the trial and
sent a
transcript of the juror's testimony on the encounter to the state bar.
Mr. Possino was subsequently convicted in 1978 in the drug case,
given a
one-year term of imprisonment in county jail and put on probation for
five
years with various conditions. The sentence was upheld on appeal on
June
18, 1979.
Although the criminal case was over, Mr. Possino's disciplinary case
with
the state bar was yet to begin. The evidentiary hearings started in
1982
and Mr. Possino was officially disbarred by the state's supreme court
on
Nov. 5, 1984, although he subsequently fought, and lost, an appeal.
In one of the odd serendipities of Howe Street, one of Mr. Possino's
last
clients was John Meier, the controversial former top aide to Howard
Hughes,
the reclusive late legendary billionaire. Mr. Possino represented Mr.
Meier
during one of two extradition fights which ended with the Hughes aide
being
sent from refuge in Vancouver to face justice in the U.S., although
Mr.
Meier claims he was repeatedly victimized in a massive CIA conspiracy.
After a lengthy and controversial investigation by the RCMP and the
FBI,
Mr. Meier had been charged years later with conspiracy to murder
Alfred
Wayne Netter, a business associate and Howe Street stock promoter who
was
stabbed 15 times in his underwear just after midnight on Nov. 29,
1974,
after letting a visitor into his suite at the Beverly Hilton Hotel
in
Beverly Hills, Calif. Mr. Meier was charged as the prime suspect
seven
years later.
Mr. Meier, who first appeared in the Vancouver area in 1972,
was a
consultant for Mr. Netter's penny stock company, Transcontinental
Video
Ltd.
Mr. Netter's murder capped a rough year. The Howe Street promoter
adopted
the alias Alfred Baron to hide his financial affairs from his
estranged
wife, leading to his conviction for perjury in September, 1974,
and
sentenced to four years in jail.
Mr. Netter, out on bail, made his ill-fated trip down to Los Angeles a
few
months later. During the murder trial years later, Mr. Meier
testified he
was far away, having flown that fateful day to Calgary, where he met
with
Ralph Buchmann, a stock promoter for Transcontinental Video.
(In an unrelated deal, a Ralph Buchmann, presumably the same fellow,
showed
up in 1999 as a private placement shareholder of Biometric Security, a
Howe
Street promotion which featured a number of associates of
controversial
expatriate Vancouver promoter Harry Moll but not Nick Masee, the
former
Moll private banker who vanished a few years earlier.)
Mr. Meier was eventually charged, along with Vancouver lawyer
Gordon
Hazelwood, with conspiring to have Mr. Netter murdered to collect
on an
insurance policy, but the high-profile case later crumbled in court.
After a lengthy headline extradition fight, Mr. Justice Samuel Toy
ordered
Mr. Meier extradited to Los Angeles in late 1983. Although Mr. Possino
had
been representing Mr. Meier, he had to hand over the reigns to
another
lawyer due to his own legal troubles in 1984, facing imminent
disbarment.
In another intriguing twist, controversial former RCMP officer Pat
Westphal
took over the Netter murder probe in 1978.
By the time of the murder trial in Los Angeles, Mr. Westphal's own
career
had taken a dive.
Mr. Westphal was one of three sergeants in the RCMP's Vancouver
commercial
crime section who suffered the misfortune of being internal
investigation
targets back in 1982 for their dealings in shares of Ayerok Petroleum
Ltd.,
whose promoter, Norm Newsom, was under criminal investigation by
their
section.
The trio left the respected police force to become penny stock
promoters.
One of the Mounties, James Hirst, quit the RCMP, where he worked, of
all
places, in the market manipulation squad, in March, 1991, to join
Ayerok.
The other two, Sergeant Westphal and Sergeant Ed Gallagher,
were
transferred out to smaller detachments in Vancouver suburbs after
an
internal investigation by an RCMP commercial crime staff sergeant
flown in
from Toronto to review the Ayerok affair. No allegations of wrongdoing
were
made against the trio, who all maintained an officially clean record
with
the force.
Meanwhile, Ayerok president Mr. Newsom, a senior member of
Vancouver's
first family of stock-market violators, was charged with
embezzling
Ayerok's treasury of $692,000 (Canadian) and convicted later in 1982.
Mr. Westphal's former Mountie/Ayerok associate, Mr. Gallagher, has had
his
own troubles with the law lately. Mr. Gallagher, the former
president of
CDNX-listed Global Cogenix Industrial Corp., was arrested and charged
in
September, 2000, with nine counts of fraud, theft and forgery
relating to
fraudulent issuances of 150,000 Cogenix shares through nominees, valued
at
a total of $75,000 (Canadian). The arrest capped a 14-month
criminal
investigation into the ex-cop-turned-promoter's Cogenix affairs.
The Ayerok fiasco was duly noted during Mr. Meier's murder trial, when
it
was brought up by his defence lawyer.
"Ayerok is a company, a Canadian company, Corporal Westphal was
involved
with the company. So is another investigating officer in this case by
the
name of Hirst and Mr. Michael Brenner," lawyer Earl Durham told the
court.
With Mr. Brenner, the prosecutor, protesting, the befuddled judge asked
for
an explanation.
"In addition Mr. Brenner is a stockholder in that company. We are
showing
that the relationship between Mr. Brenner, as the prosecuting attorney,
and
the investigating officers in Canada, as well as witnesses, are
so
incestuous as to create bias in terms of prosecution of this case,"
Mr.
Durham told the court.
While this intriguing line of courtroom banter was soon shut down,
Mr.
Meier much later gained vindication when the murder case crumbled.
As for Mr. Westphal, after leaving the RCMP, he served in
investor
relations roles with a number of Vancouver stock promotions, and
served a
two-year stint as president of the Newsom family's VSE-listed CT
Exploranda
Ltd. from 1984 to 1986. Exploranda's notable alumni include
flamboyant
stock promoter Beverlee Kamerling, then known as Beverlee Claydon, who
was
fined $1.1-million a few years ago by the Securities and
Exchange
Commission.
Mr. Westphal now lives in Henderson, Nev., and heads a Las Vegas
penny
stock promotion called International Star Inc., which features a
holding
company of New York Mafia-linked penny stock rogues Peter Berney and
Robert
Potter as its second biggest shareholder.
As for Mr. Possino, he is obviously off to bigger and better things.
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