In the wake of the Bermuda Governor’s rejection of parliament’s request that he set up a Commission of inquiry into historic thefts of land, we at Politica launched our own inquiry into irregular land transfers in contemporary times. This is the first of a series of articles.

Robert Moulder wants to know: How and why did Clarien Bank finance the unlawful transfer of his family’s land?

Gibbons Deposit Company, now known as Clarien Bank, financed an unlawful land transfer when it granted a mortgage to facilitate a property transaction in 1999.

Despite court judgements which determined that some 3,000 square feet of land was wrongly included in the property purchase, the mortgage remains on the bank’s books unchanged and undischarged, documents show.

In October 1999, Paul and Janet Slaughter purchased “Hillcrest”, a two-bedroom, one bathroom cottage with panoramic views of Mangrove Bay and Great Sound in Somerset, Bermuda.

Gibbons Deposit Company helped to finance the $375,000 deal with a $250,000 mortgage on the property. Four years later, the bank – as Capital G – loaned the Slaughters another $100,000 using the property as collateral.

Michael Cranfield, the seller, had inherited the house from his family some six years earlier.

The property bordered land belonging to the Moulder family, one of whom – Robert Moulder – would end up living right next door.

Robert Moulder’s own plans to develop his property came to an abrupt halt when the Slaughters successfully obtained an injunction – prelude to three years of litigation against him.

At issue was the 3,000 square feet strip which had been included in the sale of property to the Slaughters.

In the first of several court judgements,  Supreme Court Judge Norma Wade-Miller  found that the disputed land had not been acquired by adverse possession by Cranfield or his ancestors and belonged to Robert Moulder.

The Slaughters appealed, and lost.

In a subsequent and separate 2006 ruling, Wade-Miller affirmed a claim by the Slaughters that they had a right of way over Moulder property.  But that was overturned on appeal – leaving the Slaughters with no legal right of way or vehicular access to their house.

It is not clear why or how the conveyance could simultaneously show a right of way over,  and ownership of, the same piece of land.

And the bank has refused to provide a full explanation of its role in the transaction. Nor would it say whether it considered itself a victim of fraud or whether it had referred the matter to the police.

According to mortgage records at the Registry General, the mortgage remains undischarged.

Citing client confidentiality, Clarien Bank declined to answer specific questions about the matter.

Your query requests personal information related to a customer of ours (not Mr. Moulder), however, we cannot provide the information requested, unless required to do so by law,” said Clarien Bank lawyer Brian Myrie in an email to Politica.

You should be aware that we provide our services in accordance with our policies and procedures.

Myrie did not respond to further questions seeking to know what policies and procedures were in place to prevent irregular or fraudulent conversion of property using the bank’s mortgage funds.

Moulder, who believes he was the victim of a “well oiled fraud machine”, has been asking similar questions of the bank since the 2005 court judgement.

As part of its due diligence processes, a bank would normally seek assurance that a property has good title before agreeing to a financing deal.

The sales agreement contains clear references to the disputed land with a caution that the seller cannot give good title to the area but states that affidavits provided to the purchasers’ lawyers back his claim to title through adverse possession and a longstanding right of way over the land.

At the end of June, Moulder sent a dossier of documents to Clarien’s then co-CEO Zoran Fotak and demanded to know whether the bank followed normal banking procedures to finance the deal.

Two months later, Clarien’s lawyer wrote back explaining that it had to treat client information as private and confidential.

In a letter to Robert Moulder, the Slaughters say that they were also victimised and insist that “full disclosure” was made to the bank.

We made full disclosure, to Capital G, regarding the possessory land and the presumptive right of way,” the Slaughters assert in the January 2013 letter.

The bank was satisfied with the evidence provided by Mr Cranfield and agreed to the mortgage. The affidavit evidence is on file with the bank. We have kept the bank advised of the legal proceedings and notified them of the judgements in your favour. The bank has recently requested that the property be reconveyed and the deeds are currently with our lawyers who are amending the deeds to reflect the court judgements regarding the possessory land and the presumptive right of way.”

We conducted a search of land transfer records at the Registry General on October 15 and found no evidence of the property being re-conveyed or of the mortgage being discharged.

In their letter, the Slaughters also say that they had not seen a letter from Robert Moulder to Cranfield challenging Cranfield’s claim to Moulder property before the deal was consummated.

“If we had seen it, prior to the purchase, we would not have proceeded with the purchase,” the Slaughters wrote.

Paul Slaughter declined to comment for this story, saying the matter was subject to ongoing litigation.

Judith Chambers, Robert Moulder’s ex-wife, told Politica that they had informed the Police of the matter and requested an investigation into what they believe to be fraud. Police in turn insisted that the bank should make the complaint as  a purported victim of fraud, she said.

The fact that the mortgage remains on the books unchanged, and that the bank has not, apparently, filed a criminal complaint means that the bank is guilty of collusion in wrongdoing at some level, Chambers told Politica.

The bank has turned a blind eye to it,” she said.
It would appear that the bank is prepared to do nothing at all as long as the Slaughters are prepared to pay their mortgage. They seem to be satisfied with that, and there are false documents at the Registry General. Either the bank colluded on giving out mortgage funds on property they knew the Slaughters  did not have good title to, or the bank was deceived into giving out those mortgage funds and are not prepared to do anything about it.
Even if they weren’t in it, initially, their hands are dirty now.

Police did not respond to a query on the matter.

Banks do not, as a rule, conduct independent title searches when deciding whether to finance a property transaction. Instead, they rely on the assurance of the purchasers’ lawyers.

In 2010, Robert Moulder filed a $4 million lawsuit against the lawyers involved, Cranfield and the Slaughters claiming fraud, misrepresentation and negligence. But the action was dismissed by then Chief Justice Richard Ground.

This article belongs to Politica ! The original article can be found here: ‘Stealing’ Bermuda – Bank financed unlawful land transfer

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