By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Opposition yesterday demanded an “immediate investigation” after a New York judge ruled Baha Mar’s contractor sought to “curry favour” by paying $2.3m to a firm run by the son of Perry Christie’s top adviser.

The Free National Movement (FNM) inexplicably called no names in its statement but Judge Andrew Borrok, in awarding Sarkis Izmirlian some $1.6bn in damages over his fraud and breach of contract claim, said the “evidence establishes” that the payments by China Construction America (CCA) were designed to “gain access” to Sir Baltron Bethel and the final Christie administration’s decision-making core.

Sir Baltron was not at home when Tribune Business sought to contact him yesterday, and a message detailing the nature of this newspaper’s inquiry was not returned before press time. However, he nearly two years ago denied any impropriety when Tribune Business first exclusively revealed on November 8, 2022, that CCA had paid $2.3m to Notarc Management Group, where his son, Leslie Bethel, was chief executive.

The payments were made between December 2014 and January 2016, when the dispute between Mr Izmirlian and CCA was at its peak, but both Sir Baltron and his son denied they influenced the former’s stance towards the dispute and its participants, or his advice to the Government and its actions. 

Sir Baltron, who was the Government’s ‘point person’ in dealing with the Baha Mar controversy, said he had acted “with complete integrity and objectivity” on the Government’s behalf and there was no connection or interaction between himself and Notarc “at that time”. Leslie Bethel, meanwhile, asserted that claims of anything untoward over the $2.3m payments were “political mischief”, and they were “unrelated” to Baha Mar. 

However, Judge Borrok appeared to reach a slightly different conclusion. “The defendants actively worked to curry favour with the Bahamian government and behind the back of Baha Mar,” he ruled in reference to CCA, adding that this was another way in which they had breached their investors’ agreement with Mr Izmirlian.

“Through the end of 2014 to the beginning of 2016, the CSCEC Bahamas Board member had CCA Bahamas pay the consulting company, Notarc, belonging to Leslie Bethel, son of Sir Baltron Bethel, a senior advisor to the Bahamian Prime Minister, approximately $2.3m, purportedly for consulting services related to business opportunities in Panama,” the judge confirmed.

CSCEC is China State Construction and Engineering Corporation, CCA’s parent which is also owned by the Beijing government. “The record evidence establishes, at the very least, that the defendants relied on their business relationship with Leslie Bethel to gain access to Sir Baltron Bethel and, by extension, the Bahamian government,” Judge Borrok concluded.

Pointing out that Sir Baltron and the Christie administration “co-ordinated” with CCA during the unsuccessful negotiations to resolve the Baha Mar dispute, the judge added: “For example, while CCA Bahamas was in negotiations with the Bahamian government over a Head Of Agreement in relation to the British Colonial development, Mr Liu forwarded an e-mail communication from Sir Baltron Bethel to his son, Leslie Bethel.

“Mr Liu confirmed in his deposition testimony that he did so because he was ‘looking for help’ from Leslie Bethel, and wanted Leslie Bethel to speak with his father, Sir Baltron Bethel, about proposed edits made by Sir Baltron Bethel to the Heads of Agreement.

“Leslie Bethel reassured Mr Liu that ‘Sir B is one of CCA’s biggest supporters’ and promised to provide further help with the defendants’ interactions with the Bahamian government. Mr Liu reciprocated the sentiment, saying: ‘I am sure about Sir Baltron and yourself as our best friend’.”

Judge Borrok also picked up on e-mail exchanges between Daniel Liu, CCA’s senior vice-president, and Sir Baltron over how Baha Mar’s financier, the Chinese state-owned China Export-Import Bank, could push for a new “equity partner” to be brought into the project. Sir Baltron urged that this idea come from the bank as the Government did not want to be seen as forcing Mr Izmirlian out.

“Later on, after the March 27, 2015 deadline had been missed and in advance of a planned negotiation meeting with Baha Mar, Sir Baltron Bethel asked Mr Liu for advice as to the ‘[m]anner in which you would wish negotiations to proceed’,” the judge said.

“Later, in a July 22, 2015, e-mail, apparently inadvertently copying representatives of Mr Izmirlian, Sir Baltron Bethel proposed ‘[o]ne way of making up the equity shortfall of Baha Mar would be for the bank to advance the idea of an additional equity partner with hotel and casino experience being brought in within say 90 days’.

“He was careful to add that ‘[s]uch a suggestion should preferably come from bank and not Gov’t to prevent Baha Mar taking the position Gov’t is trying to push lzmirlian out’.” Tom Dunlap, Baha Mar’s former president, told the two-week New York trial over Mr Izmirlian’s claim that he found Sir Baltron’s e-mail “ghastly” when he inadvertently received it.

“I think the polite reaction is I don’t think I am supposed to be copied on this. But it is a pretty ghastly thought because it appears exactly as what he is saying he is trying not to appear. It looks like they are trying to work up a back room deal to replace the developer with another hotel and casino operator,” Mr Dunlap testified.

Probing further, Judge Borrok noted how Mr Liu recommended to his CCA colleagues that the Chinese contractor ‘take advantage of The Bahamas government. If the Government, the Export-Import Bank of China and CCA join forces, that can turn passive into active’.

“This e-mail chain also references apparently bilateral meetings between the defendants and the ‘Prime Minister’s Senior Advisor’,” Judge Borrok said. “This e-mail chain is a clear endorsement of the strategy of pushing BML Properties and Baha Mar out of the project, and contemplates having the Bahamian government’s assistance in doing so.”

Michael Pintard, the FNM leader, in a statement, while not naming Sir Baltron, said: “This court document presents a compelling case for an immediate investigation by the Bahamian government into payments made by foreign actors to Bahamian officials to influence government policy and decisions. Such allegations tarnish the reputation of The Bahamas as a credible and legitimate place to conduct business.”

Voicing doubt that this will happen, he added: “Nonetheless, the gravity of this situation demands that the Prime Minister act responsibly and ensure an immediate investigation by credible and independent parties into the claims that officials of the administration - where he served as Deputy Prime Minister - may have been influenced in their decisions and recommendations regarding the Baha Mar matter.

“The Prime Minister must rise above his instincts to protect members of the PLP and demonstrate that The Bahamas is a country of laws, where no one is above justice.” The Prime Minister’s Office, for its part, said Philip Davis KC had instructed Ryan Pinder KC, the Attorney General, to review the judgment’s findings but declined to comment beyond that.

“Prime Minister Davis directed Attorney General Ryan Pinder to conduct a review of the recent ruling issued by the Supreme Court of the State of New York in the case of BML Properties versus China Construction America,” it added.

“The Prime Minister has stated that the Government will await the advice of the Office of the Attorney General and Legal Affairs before making any further comments or decisions regarding the findings of the ruling.”

Judge Borrok, meanwhile, also referred to the minutes of a September 28, 2015, meeting between CCA and China Export-Import Bank officials in Beijing, where they discussed ousting Mr Izmirlian by placing Baha Mar into liquidation and finding a new owner that was preferably Chinese - which is exactly what happened.

“After the US bankruptcy case was dismissed in favour of a liquidation proceeding filed by the Bahamian Government, BML Properties [Mr Izmirlian] offered to ‘match the price’ of any other offer to buy the project’s assets out of liquidation, but did not receive a response,” Judge Borrok said.

“The project was sold out of liquidation to Perfect Luck, a subsidiary of China Export-Import Bank, and then subsequently bought by another Chinese entity, Chow Tai Fook. Thus, the failure to get the project back on track after the March 27, 2015, deadline was missed was due to the defendants’ (CCA’s) conduct.”