By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A Bahamian bank is accusing a payments provider of exploiting FTX’s collapse and related unproven claims to trash its reputation in revenge for launching a $35m damages claim against it.

Deltec Bank & Trust, in legal filings with the south Florida federal court this Wednesday, asserted that Ibanera and its principal, Michael Carbonara, have resorted to smear tactics and a campaign to undermine its integrity amid allegations that they have “unlawfully withheld” $20m belonging to the Lyford Cay-based institution and its clients.

Arguing that it has “a valid claim for defamation” over allegations posted on the payment provider’s website, Deltec is claiming this was nothing more than a “blatant attempt” to undermine its business reputation by trying to tie it to FTX’s November 2022 implosion as it continues to pursue the return of the “misappropriated” funds via the federal court system.

While Deltec provided banking and other facilities for Alameda Research, the private entity owned by FTX’s now-jailed founder, Sam Bankman-Fried, no court has ruled that the Bahamian institution had a role in the fraud that led to the crypto exchange’s failure. And, while it has been named as a respondent/defendant in several class action lawsuits launched by FTX investors, no wrongdoing has been proven.

“Deltec alleges that Ibanera published a public statement on its website, purporting to be a response to this lawsuit against Ibanera, but which in fact was a blatant attempt to invoke the specters of ‘fraud’ (including ‘the FTX fraud’), ‘money laundering’ and ‘illicit financial activities’ with the intention of causing harm to Deltec’s reputation and business, resulting in damages to Deltec,” the Bahamian bank alleged.

“Deltec alleges that the statement contains false information and also juxtaposes and omits selected facts to create a false impression. Deltec has clearly put Ibanera on notice of the claim against it. Ibanera claims that the statement is ‘true’ or simply ‘opinion’ or ‘hyperbole’.

“Yet the only explanation for Ibanera to mention FTX in a statement purporting to respond to Deltec’s entirely unrelated complaint against Ibanera is that Ibanera intended to retaliate against Deltec for filing this lawsuit by harming Deltec’s business operations,” it continued.

“Damage to Deltec’s business and reputation is also the only plausible reason for repeatedly associating Deltec with ‘fraud’, ‘money laundering’ and ‘illicit financial activities’ when Deltec has engaged in none of these activities... Ibanera’s assertion that its statement is simply pulled from the ‘public record’, or inactionable ‘opinion’ or ‘hyperbole’, rings entirely hollow.”

FTX is not the only controversy that Deltec Bank & Trust has been embroiled in. Earlier this year it confirmed it was close to resolving its dispute with the US Justice Department over the ownership of $13.475m that was seized by the federal authorities for allegedly being generated by a massive fraud. However, no charges or accusations of wrongdoing were brought against the Bahamian institution.

Deltec is presently seeking an emergency freeze and injunction from the south Florida court to prevent Ibanera from moving or dissipating the disputed $20m. The defamation accusation has become the latest stage in the two sides’ escalating legal battle over Deltec’s claims that Ibanera has effectively stolen funds which belong to the Bahamian bank and trust company and its clients.

The Bahamian bank is asserting that Ibanera published the claims with “actual malice” given that the two sides’ relationship did not start until after FTX’s collapse. It added that the latter event has nothing to do with their dispute over the $20m retained by the payments provider plus Deltec’s demand for an additional $15m in damages.

“Ibanera knew exactly what it was doing when it published that statement, and its token disclaimer that it takes ‘no position on whether any impropriety by Deltec has actually occurred’ amidst four paragraphs connecting Deltec with money laundering, fraud, illicit financial activities and the FTX scheme is entirely disingenuous,” Deltec added in its legal filings.

“Finally, Ibanera accuses Deltec of being ‘two-faced’ and of having ‘acted with ill will in addressing other litigations’ because Deltec alleged that it ‘has since learned that Carbonara and a prior company he formed were sued for similarly stealing and dissipating millions of dollars’ worth of funds they were entrusted to transmit’.

“This accusation is inappropriate as it has nothing to do with the sufficiency of Deltec’s defamation claims against Ibanera, and the allegation in the complaint is both true and directly relevant to Deltec’s claims that defendants have now engaged in the very same conduct here.”

Ibanera has also threatened to use US anti-corruption legislation, the Racketeer Influenced and Corrupt Organisation (RICO) Act, which was intended to target organised crime as the statutory basis for bringing a claim against Deltec although it has failed to detail the precise grounds it will use.

The Bahamian institution, in a previous statement to Tribune Business, also asserted that it “categorically rejects” allegations in a report commissioned by Ibanera which claimed it “misrepresented” that all the $410.206m sent to them were its own monies.

And the Lyford Cay-based operator dismissed the report’s suggestion that there were “undue delays” in its response to Ibanera’s requests for information, which the latter alleged left it exposed to Singapore financial institutions shutting down its bank accounts.

Deltec, though, told this newspaper that it has supplied the south Florida federal court with evidence proving its average response time to Ibanera’s requests was just 1.5 days. And Lanecia Darville, its in-house attorney, in court-filed documents accused the payments provider of “gamesmanship” and seeking to place Deltec “under duress” with requests that were vague and featured tight deadlines.

Ibanera’s counter-attack had alleged it was unaware that $203.45m, or close to half, of the $410.206m it received and processed on the Bahamian bank’s behalf belonged to the latter’s clients.

The report, produced by Nizam Ismail, founder and chief executive of Singapore-based Ethikom Consultancy, asserted that outbound money transfers belonging to Deltec’s clients totalled $288.896m - a sum $85.445m greater than what came in. He suggested that the latter figure, or difference, was made up by Deltec’s own funds, of which Ibanera received some $266.756m.

Deltec alleged to Tribune Business that Mr Ismail is not the “independent expert” that Ibanera made him out to be. “Instead, they relied on an undated report authored by their own former global head of legal and compliance, who did not appear in court or testify regarding his findings,” the Bahamian bank alleged.

“The report, prepared by a former Ibanera employee and lawyer, offered opinions about contractual matters but did not provide any substantiated examples of alleged delays or material inconsistencies. The claim of ‘material inconsistencies’ regarding the originator or beneficiary of funds was entirely unsupported by any factual evidence.”