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U.S FTC – Builds Case Against A.I.B.L

U.S FTC – Builds Case Against A.I.B.L
June 21
10:55 2019

Friday, June 21st. 2019 –

The United States Federal Trade Commission (FTC) case against the principals of the Sanctuary Bay real estate scam, which defrauded American consumers of over $100 million, has progressed with the agency depicting Atlantic International Bank Ltd., which was forced to close down amid the scandal’s fallout, as central to knowingly facilitating the scam.

“Atlantic International Bank played a key role in assisting the Sanctuary Belize scam…For years, Atlantic helped Sanctuary Belize sell its worthless plots, in return gaining access to the only customers it was legally entitled to serve,” a recent FTC court filing said. “Sanctuary Belize lured consumers to buy properties in its phantom resort community through a multi-step process; Atlantic was there the whole time,” it added.

The FTC says the pitch began with television ads and internet marketing, followed by calls from Sanctuary Belize telemarketers. “After making sure the marks could afford a substantial down payment, Sanctuary Belize’s California-based telemarketers pitched lots in the Sanctuary Belize development as a low-risk investment that would quickly appreciate in value,” the FTC outlined, noting that Atlantic was a key part of the sales pitch.

“By partnering with Atlantic, Sanctuary Belize convinced consumers that they would be able to obtain construction financing, which was often essential to closing sales,” the FTC said. It added that by partnering with Atlantic it made Sanctuary Belize appear more legitimate to consumers.

Atlantic benefitted from the partnership by gaining access to wealthy American depositors, a point the FTC emphasized, noting that the company by Belizean law was not permitted to serve Belizean customers – making foreign depositors, primarily American, its focus target. The FTC says Atlantic drew in consumers by developing a “special package: for Sanctuary Belize customers, giving them higher interest rates on deposits and offering construction loans with lower interest rates and more favorable terms. “The latter offer, however, was largely illusory – Atlantic financed very few loans for construction in the doomed development…One way Atlantic helped to close sales was by providing an appraiser to say that Sanctuary Belize lots were worth more than their sales price. But the bank refused to rely on those appraisals when consumers sought construction loans to build on their lots.”

The FTC argues that Atlantic availed itself to US consumers when it sent a team, including its CEO Ricardo Pelayo, to California to help telemarketers sell its services along with Sanctuary Belize lots to US residents; established long-term banking relationships with US residents via an online banking system, and made extensive use of US correspondent banks to facilitate more than 100 money transfers between Belize and the US on Sanctuary Belize’s behalf.

The FTC also maintains that Atlantic understood Sanctuary Belize’s sales process and knew about the promises it made to consumers as well as knowing those promises were false. “As years and months went by, Atlantic could not have avoided noticing that the rapid development of Sanctuary Belize was always a promise but never a reality,” the FTC said in its filing. The agency also noted an article written in 2014 by a disgruntled consumer detailing the “sorry state of development in the project,” which Pelayo allegedly emailed to Luke Chadwick, one of the principals of Sanctuary Bay, inquiring what steps were being taken to address the negative article. Pelayo, according to the FTC, even offered to send an email from Atlantic expressing continued support for the project.

Government Senator Aldo Salazar, who represented Atlantic as its attorney but is also a business partner with Pelayo, previously told the media that the allegation against the bank was for violating a US Telemarketing Sales Rule, and while that is ultimately accurate, the FTC’s filings depict Atlantic as an integral part of the scam which swindled over $100 million from US citizens. Salazar, it had been reported, was questioned in connection with the investigation, however, he denied those reports. Prime Minister Dean Barrow also announced that GOB had discussed a possible settlement with the FTC and when further questioned, Financial Secretary Joseph Waight, explained that the settlement Barrow alluded was more to repair reputational damaged caused by the Sanctuary Bay fallout rather than opening GOB to risk of covering any liability for which Atlantic may be found liable.

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