Zane DeSilva discussed loan for Savvy while in Cabinet
Zane DeSilva discussed giving a private loan to Savvy Entertainment while he was in Cabinet, according to evidence contained in a police document newly obtained by The Royal Gazette.
The document reveals that Mr DeSilva, along with fellow ministers Lieutenant-Colonel David Burch and Jamahl Simmons, received an e-mail on December 4, 2017 from Danilee Trott, Savvy’s chief operating officer, thanking them for “our meeting” the evening before and outlining the funds the firm was seeking from the public purse for two projects.
One was a music studio at Dockyard, for which Savvy was eventually lent $800,000 of taxpayers’ money, and the other was an extreme watersport contest called the Poseidon Games.
Nine days later, Savvy founder and CEO Anthony Blakey e-mailed Mr DeSilva bank account details for Savvy, stating: “Thank you for the loan of $200K. This will be used for Poseidon Games and will be give back upon receiving funds from Government.”
Mr DeSilva, the construction boss bidding to become deputy leader of the Progressive Labour Party this week, was the Minister of Social Development and Sport at the time, so was barred by the ministerial code of conduct from entering into a financial relationship with anyone negotiating or seeking a contract with the Government.
Jerome Lynch KC, Mr DeSilva’s lawyer, e-mailed the Gazette a statement on Friday in response to questions about the messages, in which he explained: “Blakey is thanking our client for ‘offering’ to loan him — it must be an offer because he includes the banking details, having not yet received it.”
The lawyer insisted: “There is no evidence that our client loaned Blakey any money at all and he did not.” Mr Lynch added: “There was no breach of the ministerial code. There was no financial relationship.”
The Bermuda Police Service-headed document states that Mr DeSilva transferred $200,000 to a third party on January 8, 2018, and the same third party transferred $150,000 to Savvy the day after.
Police believed Mr DeSilva used the third party, whom the Gazette is not naming, to obscure his financial dealings with Savvy, but once he quit Cabinet he let Mr Blakey pay part of the debt directly back to his personal bank account.
Mr Lynch described that hypothesis as “unworthy and pejorative”.
The e-mails show that at one point, while waiting for his $200,000 to be repaid, Mr DeSilva told the third party: “Please remember I have HEAT because of this to begin with — now I will have additional heat.”
The 12-page police document also reveals that former premier Ewart Brown warned Mr DeSilva and Mr Simmons against lending money to Savvy, and that the company sponsored a table at the PLP’s banquet in 2017 and was asked to do so again in 2018 by Mr DeSilva.
The company received the $800,000 loan for the studio from the Ministry of Economic Development and Tourism on April 4, 2018, and it has not been repaid, as first revealed by the Gazette in July 2019.
The police document contains a memo from former Accountant-General Curtis Stovell describing the “extreme pressure” he felt he was under to pay out the funds.
Mr DeSilva, according to the police document, transitioned “between his government e-mail address and his company's e-mail address” during discussions he had with Mr Blakey.
The e-mail exchanges (see sidebar) show how the minister quizzed Mr Blakey about Savvy’s sources of funding as he considered whether to lend money to the company.
Mr DeSilva wrote on December 21, 2017: “Can you confirm you will be receiving substantial [I think I remember you saying $5 million] end of February from Singapore and if nothing transpires between you and BDA Government, loaned funds would be reimbursed from Singapore payment?”
Mr Blakey reassured him the same day: “We are not solely relying on BDA. If nothing transpires from BDA Government, the loan will still be repaid back at the end of February.”
Mr DeSilva resigned from Cabinet on January 21, 2018. The police document shows that he e-mailed Mr Blakey his personal bank account details on April 6, 2018 — just two days after Savvy was given the $800,000 studio loan.
Mr DeSilva followed up three days later with a message asking him: “Did you transfer funds?”
Savvy paid Mr DeSilva $100,000 on April 27, 2018, according to a court document reported on by the Gazette last Monday.
Three further payments of $20,000 from Savvy’s corporate account in the United States were made to Mr DeSilva in July and August 2018, according to the police document.
The document states: “The investigation reveals that Zane DeSilva, who was a member of Cabinet, never disclosed his personal/financial interest in William Anthony Blakey/Savvy Entertainment Ltd.”
Mr Lynch said his client had no need to disclose a financial relationship because he didn’t provide a loan to Savvy, and the Government entered into a contract to loan funds to the company only after he resigned from the Cabinet
“Our client was not in government when [the $800,000] loan was made and had no knowledge of the circumstances or the arrangements.”
The police document shows that in October 2018, Mr DeSilva asked Savvy to sponsor a table at the PLP banquet and Mr Blakey’s brother, Tim, replied: “Yes, we will sponsor, just as we did last year.”
The politician, who became the new Minister of Housing and Municipalities on February 25, paid $100,000 he got from Savvy back to the public purse after he was charged in court in October 2022 with money laundering.
Mr Lynch did not respond to a question about why the additional $60,000 was not repaid to the public purse. He said that the third party and Mr DeSilva having “managed to obtain a further $60,000 … before [Mr Blakey] disappeared is unremarkable”.
Prosecutors dropped the criminal case against Mr DeSilva in August 2023 on the grounds that pursuing it was no longer in the public interest. Mr DeSilva insists he did nothing wrong.
After prosecutors decided to drop money-laundering charges against Zane DeSilva, the Southampton East MP issued a written statement in which he said: “On January 8, 2018, I loaned my lifelong friend …$200,000, some of which he invested in what turns out to be a wholly spurious project advanced by Blakey/Savvy.
“When Blakey defaulted on the loan, [the friend] asked me to recover it for him: I threatened to sue Blakey and he repaid $100,000.”
He repeated that to reporters outside court the next day, on August 21, 2023, telling them: “I lent a good friend of mine some money a couple of years back.
“He invested with the Blakey guy and he [Blakey] was supposed to repay my friend. He didn’t. [The friend] asked me to chase Blakey. I chased Blakey.”
Mr DeSilva’s lawyer, Jerome Lynch KC, gave the same account to the Gazette on August 23, 2023 and maintained his position on Friday, stating that his client “refused to provide any funds to Blakey” and instead provided the friend with $200,000 as a short-term loan, then the friend gave Mr Blakey a loan.
The silk said the $100,000 was paid back to Government after prosecutors provided evidence that the money “must have come from the Government’s $800,000 …”
The police document — a summary of the criminal case against Mr DeSilva, which was passed to prosecutors — contains an e-mail to Mr DeSilva and fellow Cabinet ministers Jamahl Simmons and Lieutenant-Colonel David Burch, which refers to a meeting held with Savvy on December 3, 2017 to discuss the company’s proposal for a government-funded music studio and a watersport contest in Hamilton called the Poseidon Games.
The police document contains further e-mails, including one dated December 13, 2017 from Mr Blakey to Mr DeSilva with the subject line “Poseidon Loan”.
Mr Blakey addressed the minister as Zane, writing: “Thank you for the loan of $200k. This will be used for Poseidon Games and will be give back upon receiving funds from Government. Should the funds not be received from Government, we will reimburse you on February 28, 2018.”
He shared bank account details for Savvy Entertainment, before adding: “Thank you so much. It’s greatly appreciated.”
On December 21, 2017, the two men discussed over e-mail how the loan would be repaid, with Mr DeSilva asking if money that Savvy was due to get from Singapore would be used in the event that “nothing transpires between you and BDA Government”.
Mr Blakey assured him Savvy wasn’t solely relying on Bermuda and had “funds coming in from various avenues”.
He wrote: “If nothing transpires from BDA Government, the loan will still be repaid back at the end of February.”
Mr DeSilva replied: “OK just need to [know] where the funds will be coming from bro.”
The Savvy boss told him: “The funds will be coming from Savvy. We will have the capital. Will it be transferred today?”
Mr DeSilva then replied: “Excuse my ignorance/bluntness, don’t want to sound rude (u know how e-mails are) but I don’t know Savvy from hole in the wall, who is Savvy? Where is Savvy getting funds from.”
Mr Blakey told him Savvy was a “global international production company” that he owned, adding: “I myself will guarantee the loan”.
Mr DeSilva then e-mailed his friend and business partner Ewart Brown, former premier, and Dr Brown’s wife Wanda, about the loan, noting in that message that Butterfield Bank had refused a loan to Mr Blakey, despite the millions of dollars he was supposedly due to receive from Singapore.
The Browns warned Mr DeSilva against the private loan and against the PLP government giving any money to Mr Blakey.
The police summary states that a cash transaction of $200,000 was transferred from Mr DeSilva’s personal bank account to the personal account of a third party on January 8, 2018.
“The next day … a sum of $150,000 was transferred from [the third party’s] personal account to Savvy’s corporate bank account with the note ‘LOAN PAYMENT’.”
On March 13, 2018, Mr DeSilva e-mailed the third party: “I’m writing to ask WHEN the 200K will be transferred? As you know, I jumped thru hoops to make this happen and we AGREED on the repayment date of March 12.
“You promised this date WOULD NOT be missed and even stated that you would more than likely pay off sooner than agreed repayment date. Please remember I have HEAT because of this to begin with — now I will get additional heat.”
The third party — described by Mr DeSilva as his “lifelong friend” — replied: “I am very sorry, Mr DeSilva. I have copied Mr Blakey on this e-mail. I will revert back to you as soon as I can give you an answer that will satisfy your e-mail.”
On April 6, 2018 — two days after a Government of Bermuda loan of $800,000 was paid to Savvy — Mr DeSilva e-mailed his bank account details to Mr Blakey. He asked him on April 9 and April 26 if the funds had been sent.
On April 27, 2018, Savvy transferred $100,000 to Mr DeSilva. The police document states there were three additional payments of $20,000 — on July 20, 2018, and August 6 and 27, 2018 — from Mr Blakey’s corporate account, Savvy Entertainment Ltd Inc in the United States, to Mr DeSilva’s personal account.
Mr Lynch said in his statement on Friday: “There is no evidence that our client loaned Blakey any money at all and he did not.”
Mr DeSilva e-mailed Savvy and the third party on October 13, 2018, to ask if “notwithstanding the other agenda” they would sponsor a table at the PLP banquet.
Mr Blakey’s brother, Tim, who was involved with Savvy’s purported charitable foundation, replied: “Yes, we will sponsor, just as we did last year.”
Mr Lynch said: “The e-mails for table sponsorship of the PLP dinner is unremarkable as people, businesses and others connected or unconnected with government are solicited for taking a table at the annual PLP banquet.
“We do note that sending a joint e-mail to [the third party] and Blakey does demonstrate that our client lumped [the third party] and Blakey in together as being jointly responsible for the debacle that was the project they embarked upon.”
In a new twist to the long-running Savvy saga, the police document reveals that Dr Brown warned both Mr DeSilva and Mr Simmons, who was the Minister of Economic Development and Tourism, about Mr Blakey after he and his wife, Wanda, did some online detective work.
Mrs Brown told Mr DeSilva — or “Zaney-baby”, as she addressed him — in a December 21, 2017 e-mail: “This guy is as slippery as an eel … I would suggest that you not engage further re loaning him $200K and let him know that.”
She added: “This guy may have had some success with events. But money is something you nor the PLP Government should let get close to his hands.”
Later that day, in an e-mail to Mr Simmons and Mr DeSilva, Dr Brown flagged up worrying information he had discovered about Mr Blakey, writing: “Be forewarned. Please learn from this. Due diligence is not a bad thing to do, especially with people who NEED $200K before a lick of work is done.”
Mr Lynch said his client heeded the Browns’ advice and did not give a loan to Savvy.
Instead, a few weeks later, he transferred $200,000 to the third party.
Mr Simmons, along with David Burt, the Premier and Minister of Finance, and their Cabinet colleagues, approved the $800,000 government loan to Savvy about three months after the Browns’ warning.
Both Mr Burt and Mr Simmons, now a backbencher, have apologised for their role in giving Savvy the loan, while insisting they acted on advice from civil servants.
Mr Simmons, PLP MP for Sandys South, said last week: “I have apologised to the people of Bermuda and I do so again without any reservation.”
Mr Burt told the public in a Facebook post on September 24, 2020: “Government ministers cannot release monies from government accounts. Public officers are the only persons who can authorise monies to be sent and they must be satisfied that all is according to financial instructions.”
The police document obtained by the Gazette shows Mr Stovell, the Accountant-General when the government loan was issued, raised concerns with Randy Rochester, then the Permanent Secretary at the Ministry of Economic Development and Tourism.
Mr Stovell wrote in an April 4, 2018 e-mail that, despite the Cabinet’s approval “this is an unusual transaction, as the Govt is not typically in the business of making commercial loans to private enterprise”.
He wrote: “The quick turnaround requested created a high risk, as it potentially did not allow me sufficient time to exercise my responsibilities under the Public Treasury Act and financial instructions.
“It is in haste that lapses often occur, particularly when there is extreme pressure being placed on the ACG [Accountant-General] to execute immediately.”
He added that the loan agreement was signed on April 2, 2018, the same day he was made aware of it, noting that the “closeness of execution and the requested funds transfer is a cause for concern”.
A government spokeswoman, in response to questions for the Premier, told the Gazette last month: “No breach of the ministerial code has been identified to the Premier and, in circumstances where breaches are noted or alleged, matters are addressed pursuant to the code.”
David Burt, in an interview with The Royal Gazette last week, referred to good governance measures implemented by his administration, stating: “There are a number of things that were advanced; we said we would advance the ministerial code of conduct, we did.”
The Premier, who was not being interviewed about Savvy, said he did “not believe that our democracy is functioning as well as it should because I do not believe that there is enough oversight that is happening from the House of Assembly or the Senate, the legislative branch which is there to provide oversight for the action of the executive”.
Mr Burt said the one thing his government had “not been able to advance is matters related to campaign financing and elections” but there was potential for a bipartisan committee to tackle the issue.
He said he hoped for “more robust oversight from the legislative branch because it is important for the accountability matrix of the Government”.
• Chief Reporter Sarah Lagan contributed to this report
The Royal Gazette asked Mr Burt, the PLP and the Browns for comment for this article but there was no response by press time.
Questions to Andrew Murdoch, the Governor, prompted an e-mailed statement from Government House which said it could not comment on documents it “could not possibly verify”.
It added: “For reference you will note that the Bermuda ministerial code is a document produced by the elected government and that it states that ‘The Premier is responsible for upholding the requirements of the code of conduct’.”
A BPS spokesman said on Wednesday: “The Bermuda Police Service can confirm there is an ongoing investigation into the $800,000 public loan to Savvy Entertainment.”
Mr DeSilva, who told the Gazette last April that he may throw his “hat in the ring to be premier of the country” next year and will take part in the PLP’s deputy leadership contest on Tuesday, denies any wrongdoing.
Cabinet minister Zane DeSilva was introduced to Savvy CEO Anthony Blakey by a third party to see if he could personally assist with funding a sporting event, according to a statement issued by his lawyer on Friday.
Jerome Lynch KC said: “Blakey claimed a need for immediate liquid cash, which he asked our client to consider loaning.
“Our client was ostensibly willing to loan Blakey the money, subject to being able to satisfy himself that there was a route to repay it.
“There was correspondence between them, some of which you have. Blakey was unable to satisfy our client that he could or would repay it, following all manner of blandishments that he was to get significant funding from Singapore … and a variety of other sources, yet no contract or other document evidencing same was produced and as a result our client refused to provide any funds to Blakey.”
The lawyer said the third party was willing to invest in Mr Blakey’s plans and asked Mr DeSilva to lend him the money so he could do so. The minister then gave the third party a short-term loan, Mr Lynch added.
He said: “When Blakey failed to repay the loan to [the third party] giving him all manner of excuses, [the third party] had to tell our client that he was not in a position to repay the debt as promised.
“Our client was obviously peeved and contacted Blakey direct telling him he had better repay the loan or he would be sued.
“Blakey paid part of the loan, $100,000, direct to our client on behalf of [the third party]. Thereafter, Blakey made himself scarce and our client sought to initiate proceedings against him on behalf of the Government for the entire $800,000 [taxpayer-funded studio loan].”
Mr Lynch said once Mr DeSilva was shown evidence by the Department of Public Prosecutions that the $100,000 repayment must have come from public funds, he “immediately sought to return the money”.
The lawyer did not explain why another $60,000 paid to Mr DeSilva by Savvy, according to a police document obtained by the Gazette, was not returned.
Mr Lynch said Savvy sponsoring a table at a Progressive Labour Party banquet in 2017 was "unremarkable, as people, businesses and others connected or unconnected with government are solicited for taking a table at the annual PLP banquet“.
He added: “Nothing [Mr DeSilva] has said here is different from that which he told the police at the time when being interviewed.”
He wrote that the DPP had “all the same information that you have (and more) and chose to” drop the criminal case for money laundering against Mr DeSilva.
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