Castle Bank & Trust (Bahamas)

Castle Bank & Trust
Industry Banking
Founded 1960s
Founders Paul Helliwell, Burton Kanter
Headquarters Nassau, Bahamas

Castle Bank & Trust was a Bahamian bank that was involved in tax evasion, as well as covertly funneling funds for the Central Intelligence Agency. The bank was founded in the 1960s by Paul Helliwell, a former member of the Office of Strategic Services, and Burton Kanter, a tax lawyer.

The bank was used by the CIA to funnel money for covert military operations, including those at Andros Island (Bahamas), a staging area for anti-Castro activities.

The bank had many clients, including celebrities, organized crime figures and wealthy business owners. Some of the most notable included John Fogerty and other members of Creedence Clearwater Revival, who lost most of their wealth when the bank collapsed, Tony Curtis, Hugh Hefner, Penthouse (magazine),and members of the Pritzker family (owners of the Hyatt hotel chain).[1] Reputed organized crime members that were customers included Moe Dalitz, Morris Kleinman, and Samuel A. Tucker.[2][3][4][5]

In the early 1970s, the U.S. Internal Revenue Service started an investigation into the tax avoidance schemes used by the bank. The investigation was called Operation Tradewinds. The IRS was able to secretly photograph a list of the bank's clients, after being provided with a bank executive's briefcase that was taken from the executive's apartment by an IRS informant.[1] As a result of this information, the IRS launched a new investigation, called Project Haven, into the tax affairs of the people on the client list.[6] A prosecution of one of those clients eventually reached the United States Supreme Court as United States v. Payner. Project Haven was later suspended because the names of the clients obtained from the briefcase was an illegal search. The Department of Justice also dropped its investigation for the same reason.[1]

According to Wall Street Journal reporter Jim Drinkhall, the case was later dropped because of pressure from the CIA, which had been using the bank as a front to fund covert operations.[1]

Burton Kanter was tried, but acquitted in 1977 in a case involving tax evasion on the sale of a Reno, Nevada hotel using an account at Castle Bank & Trust. However, his law partner, Roger Baskes, was convicted in the case.[7] In 1982, attorney Calvin Eisenberg, another of Kanter's law partners, was convicted of advising in the preparation of false tax returns in a scheme using Castle Bank & Trust.[8]

See also

References

  1. 1 2 3 4 Drinkhall, Jim; 1980 (1980-04-24). "CIA Helped Quash Major, Star-Studded Tax Evasion Case". Washington Post. ISSN 0190-8286. Retrieved 2017-07-18.
  2. ↑ Are Bahamas Banks Offering Tax Haven? The Pittsburgh Press December 30, 1975
  3. ↑ Second Bahaman bank goes under Star-News May 26, 1977
  4. ↑ Law Agencies Probing Caribbean Tax Havens Sarasota Herald-Tribune April 25, 1976
  5. ↑ IRS Resumes Probe of Secret Offshore Accounts The Milwaukee Sentinel December 27, 1975
  6. ↑ Conflict at IRS? by Jack Anderson The Telegraph October 25, 1976
  7. ↑ New York Times September 13, 1977 "Attorney is Acquitted of Tax-Evasion Charges"
  8. ↑ Loop lawyer convicted in tax fraud scheme Chicago Tribune February 25, 1982

Further reading

  • Masters of Paradise: Organized Crime and the Internal Revenue Service in The Bahamas By Alan A. Block ISBN 1-56000-971-3
  • The Politics of Heroin: CIA Complicity in the Global Drug Trade by Alfred W. McCoy ; New York: Harpers and Row, Publishers Inc., 1991 ISBN 1-55652-483-8
  • The Crimes of Patriots: A True Tale of Dope, Dirty Money, and the CIA by Jonathan Kwitny ; New York: W.W. Norton, 1987 ISBN 0-393-33665-4
  • In Banks We Trust by Penny Lernoux ; Anchor Press/Doubleday 1984 ISBN 0-385-18329-1
  • CBS Television "60 Minutes" The Castle Bank Caper November 21, 1976
  • "Oversight Hearings into the Operations of the IRS (Operation Tradewinds, Project Haven, and Narcotics Traffickers Tax Program)," Hearings before a Subcommittee of the Committee on Government Operations, House of Representatives, 94th Congress, 1st Session, Oct. 6, Nov. 4 and 11, 1975.


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