draining development.pdf - Khazar University

436 Draining Development?Proceedings in GuernseyNearly three and a half years after BNP’s first refusal to make the payments,in March 2006, Garnet, which Tommy admitted, early on, was hiscompany, began proceedings against BNP in Guernsey seeking declarationsthat BNP was obliged to comply with its payment instructions. 18 InSeptember 2006, the Royal Court of Guernsey ordered that the IndonesianEmbassy in London should be notified of the proceedings and askedwhether it wished to make any claim to the money in Garnet’s accountwith BNP. As a result of this notification, Indonesia took steps to intervenein the proceedings and was joined as a third party in January 2007.Indonesia immediately applied for a freezing order on Garnet’saccount with BNP, which was granted by the Guernsey court. The freezingorder was continued in subsequent applications. However, the courtin Guernsey made it clear from an early date that it did not want to bethe sole focus of Indonesia’s endeavors to recover what were alleged tobe the proceeds of corruption among members of the Suharto family.Tommy maintained that the monies in the account represented the saleof his shares in Lamborghini, the luxury car maker. That may have beenso, but begs the question where the money came from to purchase thoseshares.The Guernsey court said that Indonesia needed to demonstrate thataction was being taken by the authorities in Indonesia against Tommyfor corruption. Ideally, the court in Guernsey would have liked to haveseen a conviction obtained in Indonesia. However, all attempts by theIndonesian government to bring civil claims and obtain a judgmentagainst Tommy failed.Difficulties in IndonesiaIn 2008, the Indonesian courts dismissed the last of the government’sclaims. Indonesia appealed and won, but, in the meantime, the freezinginjunction in Guernsey had been released. This was the result of a decisionof the Court of Appeal in Guernsey in January 2009. The Court ofAppeal’s decision was appealed to the Privy Council in London, which isthe highest Court of Appeal for Guernsey. The Privy Council refusedleave to continue with the appeal, but the Guernsey Financial IntelligenceService, which had originally frozen the funds, has withheld its