This is like a scene carved out from a Hollywood thriller blockbuster movie, an Asian colluding with a bank to circuvent a court order.
But this is certainly not a Hollywood movie nor a blockbuster hit either, it is a story that is happening in real life and in attempts to construe the facts i was faced with threats of legal litigation and even a verbal threat. Despite the threats, i stoodfast to complete this piece as i’m convinced that the truth must not be held back, it must be revealed as it is.
How the case came about
In 2013, on the island of Kolombangara in Western Province a logging company, Zorutu Development Company (the licensee) was going about doing its normal business. Next to Zorutu Development Co. was another logging company, Poly logging (SI) Ltd (who is the contractor under the license of Viuru Forest Enterprise Ltd), it operated on a different demarcated area, called the Kiuwai land.They were neighbors so to speak, the only boundary that separated them was a customary land mark.
The issue between the two different logging companies came about when Poly logging (SI) Ltd landed its equipments on Kiuwai land and operated into Zorutu land, and it sparked a legal battle where Zorutu Dev. Co. ( represented by James Rizu) took Poly logging (SI) Ltd to court for trepassing. The initial court proceeding involves Zorutu Dev. Co. seeking court orders to restrain Poly logging (SI)Ltd from entering Zorutu land of which the former is the licensee of the disputed land. The initial court by Zorutu Dev Co. was done on ex parte basis, meaning Zorutu Dev. Co. was seeking court orders without the other party (ie Poly logging (SI) Ltd) present to defend themselves. The ex parte order is normally issued by the court for maintenance of status quo in urgent situations, without the presense of the other party so as not to interupt the operation of the applicant, in this case Zorutu Dev. Co. The court upheld the arguments advanced by Zorutu Dev. Co and so a court order restraining Poly logging (SI) Ltd from entering Zorutu land was imposed. A subsequent’ inter exparte’ procedure was held on 4th October 2013 and a judgement was made on the 14th of October 2013 as well. The inter parte hearing gives the opportunity for the respondent, Poly logging (SI) Ltd, to defend itself. The 14th October high court ruling (civil case number. 315 OP 2013), however, upheld the initial decision it made, that so the ex parte restraining order was continued with against Poly logging (SI) Ltd from carrying out any activities within the Zorutu land.
Amongst the 21 orders made by the court, the number two order clearly spelt out that ” all proceeds (less government tax) of logs exported from Kiuwai land be paid into a joint trust account in the names of the solicitors for the parties”.
Fraudulant act
This is the subject of this piece, i have documents in hand that reveal BSP bank has colluded with a person directly involved with Poly logging (SI) Ltd to circumvent the court orders and also in the process breaching the bank’s own policy not to carry loggers’ accounts.
As referred to earlier, the court order number two that stated “all proceeds (less government tax) of logs exported from Kiuwai land be paid into a joint trust account in the names of the solicitors for the parties”, this clause was never honored and upheld by Poly logging (SI) Ltd. The logging company’s (Poly logging (SI) Ltd) General Manager one Yuan Fang Lu instead created a company, ZSI Import and Export Co. Ltd, to go around the order and continues to carry transactions for the Poly logging (SI) Ltd.
According to the online company haus, the director of ZSI Import and Export Co. Ltd is solely Yuan Fang Lu and the address and contact numbers of the company is the same with Poly logging (SI) Ltd as well. To add on the similarities, the account that ZSI Import and Export Co. Ltd has with BSP bank has been in operational with substantial amount of money coming into it. On two separate occasions, an amount of over three million came into the account and raising suspision that the ZSI Import and Export Co. Ltd is in fact a conduit for Poly logging (SI) Ltd. In other words, Poly logging (SI) Ltd has used a hoax company to continue export timbers from the disputed Zorutu land and in that manner, it defies the court order of 14th October 2013 (as alluded to earlier).
According to a BSP’s Telegraphic Transfer (TT) advice dated 28th November 2013, a sum of $3,599,327-90 by order of Nagasaki International Limited was deposited in account number 4000545550, the account name was/ is ZSI Import and Export Co. Ltd. Interestingly, the court orders were effected on October 14th and in an attempt to go around the orders, Mr. Lu has intentionally created the account (as alluded to above) with BSP under the name of ZSI Import and Export Co. Ltd, the same account that Poly logging (SI) Ltd continued to operate under. That same account has an incoming TT just on August 14th last month from the same (buyer), Nagasaki International Ltd, the sum of money coming into it was also in the region of three million. According to loggers, such figure could mean ZSI Import and Export Co. Ltd has exported more than 3000 cubic metres of round logs. I do have a copy of the sale contract between Poly logging (SI) Ltd and Nagasaki International Ltd further confirming that the former (Poly logging (SI) Ltd) is the seller and the latter (Nagasaki International Ltd) is the buyer of round logs.
Responses from Mr. Lu and BSP bank
When a phone call was made to Mr. Lu for him to confirm whether or not the ZSI Import and Export Co. Ltd is in fact Poly logging (SI) Ltd, a defiant “different, different, different” was all that i got as a response. Not long after, a Solomon Islander called my mobile, introducing himself as the Operations Manager and demanded that i gave him the copy of the court order and as they are not aware of it. I told him that the court order was made on 14th October 2013 and i questioned him why he wasn’t aware of it. But the Operations Manager demanded that i should served them the copy of the court order immediately and he repeatedly told me that their lawyer would call me and i should be ready to talk to him (the lawyer).
I waited for a week now and i haven’t received any call from their lawyer as yet. But i do have documents in possession to confirm the facts of this story and i stood by the facts as any other responsible journalist would do.
As for the BSP bank’s response to this allegation, an email from their country manager, David Anderson stated “… unfortunately I cannot give you a statement on something I know nothing about. Funds received by Telegraphic Transfer to credit of account do not say what the funds are for. As stated below we have questioned the company if they are involved in logging and they have denied this. In view of your [information] we will continue to investigate further and if we do discover that they are involved in logging which is in breach of their Foreign Investment Board approval, we will close the account.
I would be happy to receive copies of the evidence you have so we can discuss with customer further and as stated above unless he can prove otherwise we would close their account.”Mr. Anderson also raise a point that if i’m in possession of the TT advice and if i can also confirm that i took it from a bank officer, he strongly stated that it is a breach of confidentiality for a bank officer to facilitate the document.
The facts
As stated in detail earlier, I have the documents that suggests Poly logging (SI) Ltd’s General Manager, Mr. Lu, has created a company, ZSI Import and Export Co. Ltd, to evade the court orders of 14th October 2013 civil case number. 315 of 2013. I also have the document to suggest that Poly logging (SI) Ltd and Nagasaki International Ltd are trading partners, the former being the seller and the latter as the buyer of round logs. Their trading is obvious in the transactions made in the ZSI Import and Export Co. Ltd account held with BSP, it is evident with an incoming TT of 28th November 2013 and another recently on August 14th 2014.
As a news reporter, i have done my part to expose what could be described as an attempt by a logging company to evade an order made by a competent court of law in our country. I urge the Solomon Islands Financial Unit of the Central Bank of Solomon Islands (CBSI), to investigate what is now clearly a money laundering activity.
Unlike the Hollywood thriller movies where the main character often came out victorious in the end, this story is based on facts and the ball is in the courts of the responsible authorities to make the right decision, one that reflects the values of transparency, accountability and good governance.
For the record, my next story will reveal how logging companies operating in Velalavella attempt to evade paying taxes (export duties) to government. Surprisingly another financial institution, the Westpac Banking Corporation, has been facilitating the accounts of these alleged offenders. Stay tune avid readers.
By Charles Rongovata
