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A Good Look at the Massive Fraud of the FAKE Somali International Financial Center (SIFC), First Oceanic Bank, SomaliaWeb.biz, SomaliaOffshore.com, and More

In the quest for privacy, and especially financial privacy, and particularly on the internet, you tend to run into a lot of scams and dodgy stuff. I don’t believe I’ve ever seen one so intriguing as the case of the Somali Offshore Banking Scam one however. Somalia is an unusually odd country. It is the only one in the world that I know of with no central government to speak of. The areas within its former borders are controlled by tribes. The Western press calls the tribal leaders “war lords” over and over, and some even are.

Somalia: The perfect offshore banking safe haven for your life savings

It has been this way since 1991 when the Somali people overthrew the regime of their then oppressive government called the “Somali Democratic Republic.” After a lot of drama, bloodshed and civil war, February 2004 brought a UN-recognized Transitional Federal Government, called the “Republic of Somalia,” chartered to establish a central governing body over the Somali people. See Wikipedia’s page for more on that.

Enter the Somalia International Financial Centre via SomaliaWeb.biz

SomaliaWeb.biz was, until 2007 the only website touting the Somalia International Financial Centre (SIFC). It had information about the SIFC, and was supposed to be a government-run website. It displays the so called International Banking Act 2003 claiming to have been “passed in June 2003 by the government of the Somali Democratic Republic, which aims to develop the financial and business services infrastructure and to stimulate foreign investment in Somalia.” But wait a minute! The Repbulic of Somalia now claims sovereignty over Somalia. The Somali Democratic Republic was the old government that got overthrown. They are able to get away with this offshore financial center scam because people do not understand that. They might even be members of the old regime, and thus claim this is legitimate! Who knows? Nobody outside of Somalia – that’s for sure.

As you can plainly see, SomaliaWeb’s domain was registered with a privacy service out of the US Domains by Proxy, Inc. (DomainsByProxy.com). Why would they do that if they were in any way linked to a government? Have you ever known a government to hide their domain registration name and address? They list the headquarters of the International Financial Centre at the Central Bank of Somalia’s building in Mogadishu. Never mind that the Somali Bank building was last reported YEARS AGO as possibly destroyed in the crossfire of the ongoing street warfare raging there! Wikipedia’s Somalia Central Bank entry says “Since the collapse of the political system in 1991, it is unclear whether the Central Bank is still working. There is no active website and news about this bank is rare.” However, this is not true, although it may have been when it was written. The current Central Bank of Somalia website is located at http://somalbanca.org.

SomaliaWeb was registered 05 January 2006, and it seems to me that it was setup by the now (apparently) defunct Star Trust Company. The Star Trust Company, who’s website (www.SomaliaOffshore.com) was registered through a domain privacy service around April 2006, claimed to be able to facilitate Somalia offshore bank licensing, and citizenship / passports, among other services. Their address was (presumably a maildrop) in Liechtenstein.

Something isn’t quite right about this though… Why are there no independent company registrars / registered agents? Why doesn’t the so called SIFC promote IBC registration, Insurance or anything else aside from bank incorporation? They even display insurance licensing legislation, but they don’t promote insurance company formation. They don’t display or promote IBC formation legislation, but obviously, you need that to form bank or an insurance company… right? The same goes for Trust Companies. They display a definition of a Trust Company, but do not require licensing, apparently. Jama Ali Jama, at the time (2004) a presidential candidate for the Somali Republic and President of Puntland, wrote the following about this whole boondogle:  “No new legislation has been enacted since the collapse of the Central Government in 1991.  The publication of the “International Bank Act 2003″ would therefore appear to be a misguided attempt to give credence to the existence of Somali offshore banking and the registration of Somali offshore companies.”

Furthermore, the SIFC’s “legislation” was copied, almost word for word from the Mwali International Services Authority (MISA). How do I know this? I can’t verify that because MISA seems to have disappeared and taken the text of their legislation with them. But this is evident due to one glaring problem with the supposed Somali International Banking Act 2003 that makes me suspect it was never written on paper at all: it says “Mwali International Services Authority” write there in the text! And I quote article 7.2 from the DECISION OF THE SOMALI INTERNATIONAL FINANCIAL CENTRE section:

“In the event of the application being refused by the Mwali International Services Authority he shall not be required to give or assign any reason for such refusal to the applicant or any other person.”

From the looks of it, they failed to see that one instance and substitute it with the words “Somali International Financial Centre”. Wow. You lose!

Furthermore, this was all noted as early as July 17, 2004 in THE INDIAN OCEAN NEWSLETTER in an article entitled, “Offshore Banking or Fraud?” …and I quote:

Internet sites are boasting of the merits of a Somali International Finance Centre in an approach that reeks of a scam.

For some months, Internet sites specialised in offshore banking have been advertising a certain Somali International Finance Centre (SIFC) which claims to have been instigated last year by the Transitional National Government (TNG) of Mogadishu. SIFC’s purpose is to offer foreign finance companies an instant access to tax free offshore status in Somalia. This SIFC claims to have been created following the passing of an impressive series of bills (International Bank Act, Anti-Money-Laundering Law) and the creation of a Department of Anti-Money Laundering (DAML) by the Somalian TNG.

This same government may have mandated the company Star Trust Co. Ltd to provide the promotion for this SIFC and sell offshore licences to foreign banks and insurance companies, along with accommodation addresses for casinos and even, according to the Star Trust web site, Somalian passports. The Star Trust web site gives a contact address in London and the name of a certain Mark Anderson, while nevertheless informing its potential clients that contact via e-mail is preferable. In fact, Mark Anderson, who registered the Star Trust web site on 10 October 2003, has an address in North York in Ontario (Canada).

All this looks very much like a fraudulent operation, since none of the acts mentioned have been passed by Somalia. In any case, the is no central bank in Somalia, nor has there been a representative government at a national level for over a decade. Furthermore, according to a specialised web site, OffshoreBankingIndex, the texts of the acts which are supposed to have created the SIFC are similar to those in a similar type of operation on the site Mwali.org concerning the island of Moheli (Comoros). This site was registered in October 2002 by a certain Jean Michael Jasques on behalf of a Mwali International Services Authority (Misa), supposed to be domiciled in Fomboni in the Comoros Islands (BP nDEG724) and represented by a Mwali Trust Company which claims to have already provided addresses in Moheli for offshore companies, apparently with no legal basis.

FIRST OCEANIC BANK LTD

It seems that the first bank “licensed” by these Somali “authorities” was First Oceanic Bank (FOB) in 2005 with the website (www.firstoceanicbank.com/) launched around March 2006.

FOB incorporated a company in the UK named “FIRST OCEANIC BANK UK LIMITED” (Company No.: 05869161). It was not a bank, and it is legal in the UK to have the word “BANK” in your company name for any purpose – unlike in most jurisdictions. The UK only requires a business OPERATING as a bank to have a banking license. Then, these FOB guys draw up essentially fake papers saying Somalia licensed the bank, and apply for a correspondent account with those papers to a small bank in the Turkish Republic of Northern Cyprus. Northern Cyrpus is a small break-away state on the island of Cyprus supported by the Turkish military but not officially recognized as a sovereign state by any other country’s government. (It is interesting that states such as the UK will put sanctions on Northern Cyrpus all the while saying it doesn’t exist… but that’s a story for another day.) The appearance of legitimacy of their Somali bank was bolstered by the appearance that a UK bank by the same name is the holding company this Somali banking subsidiary, a claimed they made on the first version of their website. Alternatively, it is possible that to get the correspondent account, they skipped the whole fake Somali papers act and somehow convinced the North Cyprus bank that they were a London bank. The Star Trust Company put it this way in trying to get people to buy a Somali offshore banking license through them:

Opening Representations in Europe

Although your bank will of course have its registered office in our capital Mogadishu, it is often helpful for internationally-oriented banks to maintain a verifiable presence in another country. To this end, Star Trust Company is able to guarantee opening of a representative subsidiary which is fully authorised to use the full title of the company including the word bank for all operations within the European Union.

Therefore you can legally open an office and display the full bank name within the European Union. You will have a verifiable local presence through an incorporated subsidiary which can obtain a local credit/finance company licence (of course not a full bank licence) subject to status.

The Frenzy Leading To FOB’s Popularization

First Oceanic Bank advertised on LowTax.net who was apparently conned into believing the SIFC existed and Somalia was the latest offshore banking haven with the best privacy. They even added Somalia to their low tax jurisdictions list for a time, but removed it citing instability around the time that the Ethiopian army invaded Somalia. FOB ads remained on their site however! Even the idiotic, globalist, freedom hating Tax Justice Network got in on the action decrying the horrible new money laundering potential created by the recent secrecy-laden offshore banking laws inacted by the Somali government! A “Strategic Assessment” was written about African diaspora and remittances mentioning offshore banking in Somalia. The blog that eventually became DigitalMoneyWorld.com even covered it, moslty because FOB was, as far as they could tell, a bank that accepted digital gold currencies! FOB accounts were opened for financial privacy seekers by the sometimes less-than-diligent “introducing brokers” (“IB”) like Offshore-Manual, PTClub, PrivacyWorld, PT Shamrock,  Chesterfield-Offshore.com, ExecutiveMaildropServices.com, Global Virtual Offices, Switzerland Mail Drop, Panama Depot Virtual Offices, OffshorePrivacy.org, WorldOffshoreBanks.com, Conexion.cc, sk-business.com, FinancialPlanning-SPO, Banca-Europea, Holland Office, H.H. Prince Jamal Al Noaimi Crown Enterprises, and others for anywhere from $99 to €2,999. Most of these IB’s have seen the error of their ways, once FOB “turned turtle” and they got a barrage of customer complaints, but I imagine they did not give back one red cent in refunds.

In the beginning, First Oceanic Bank had a correspondent account with Renfrew Security Bank & Trust Ltd. (Offshore), which requires a $100,000+ minimum initial deposit. Apparently, their account was closed, because they are now using another correspondent account at Northern Cyprus’ RAHIM Bank (a bank which doesn’t reply to potential client e-mails, by the way).

I guess during that time, their virtual offices found out what they were doing and kicked them out as well, because their maildrop / virtual office address changed several times, from their original UK registered address (BCM Drawbridge Apartments, 27 Old Gloucester Street, London, not applicable WC1N 3XX – which was also shared by the Star Trust Company, mentioned previously), then to 80-83 Long Lane, London, EC1A 9ET, England, and then ending up in Liechtenstein (in early 2009) – the same place the Star Trust Company claims to hang its hat. Currently (May 2009 – UPDATE 3), their “Support Call Centre in London, UK” is at the following address with corresponding phone and fax numbers:

87 Sloane Avenue
Chelsea, London, SW3 3DX
TEL: +44 (0)20 3286 1227 or +432-663-248-615
FAX: +41-4-4567-19-23

Around late 2006, the complaints about First Oceanic Bank started to roll in heavily. Most reported First Oceanic claiming correspondent bank problems or technical errors, delaying wire orders, not responding, deleting client accounts, not funding cash cards or rarely funding them, even blatantly not carrying out orders and generally failing to deliver. I guess they just couldn’t keep things going any longer charging €300 here, €150 there, €900 over there, €75 for a wire transfer, and otherwise raping their clients with ridiculous-sized fees, so they reverted to outright theft it seems.

Some reports of their fraud are here:

http://www.antifraud-agency.org/fob.htm
http://members5.boardhost.com/ruchihealth/msg/1206093377.html
http://www.business-podium.com/boards/banken-stiftungen-trusts/3268-warnung-warning.html
http://www.talkgold.com/forum/r136110-.html
http://www.talkgold.com/forum/r113017-.html
http://www.talkgold.com/forum/r130822-.html

http://www.talkgold.com/forum/r196505-.html

http://www.talkgold.com/forum/r199013-.html

http://www.talkgold.com/forum/r113017-.html

http://www.complaintsboard.com/complaints/first-oceanic-bank-c82493.html

http://forum.reserve-bank.com/viewtopic.php?t=70&sid=fb4f55e976b589a9b8f33104bcf94abd

http://www.talkgold.com/forum/r256457-.html

With that cash cow taking flack, the fraud spreads…

ENTER THE SFIC WEBSITE, BANCA RE MIDA, ATLANTIC SWISS BANK & OTHERS

The Somalia International Financial Centre website was created on 19 March 2007, claiming Corso Somalia 55, the Central Bank building, as it’s address. It is linked-to by SomaliaWeb.biz and has essentially taken over.

There were at least two other banks that are currently accepting accounts that claim to be licensed by the Somali International Finance Centre (SIFC). The SIFC also claims that these banks are all licensed (or were licensed, as they claim to have revoked BancaReMida’s license). BancaReMida’s website domain was registered on 07-Sep-2006. So, I guess they “bought” their license from the SFIC when it was still exclusively at www.SomaliaWeb.biz. Their address is listed as Dubai Airport Freezone, 3rd East Wing, 4th Floor, P.O. Box 54620, Dubai, United Arab Emirates. As of March 2009, the UK’s Financial Services Authority says Banca Re Mida is not authorized by them to be a bank in the UK, but they seem to think that the Somalia International Finance Centre is real just because it has an internet site. Wow.

The Royal Swiss Investment Bank (with their affiliated Royal Investment Company) made a brief appearance, even on the SIFC site, but they aren’t displayed there anymore for some reason. There was also the United Central Trust Bank (www.uctbank.com) that claimed to be licensed in Somalia, but their url never appeared on a SIFC-related page.

The latest and most prominent one now is the Atlantic Swiss Bank, registered on 31-Mar-08, whom the SIFC claims to have incorporated on 01/Mar/2007. Who knows, maybe the Atlantic Swiss Bank proprietors think their license is real and run things on the up and up. Like I said though, who knows? Maybe they don’t!

Moral O’ Tha Story: As you can see, this has all been one big imbroglio and will probably continue to be. So, next time a doubious website is claiming to have setup a government operated offshore financial center in a country that hasn’t had an official government for 15+ years and offers banking licenses for $22,000, perhaps you should sit that one out.