In one of the largest fines ever to be handed down in a common law jurisdiction, over $45 million of the Bermuda-based IPOC International Growth's British Virgin Islands holdings were confiscated after the fund pleaded guilty on Wednesday to perverting the court of justice and furnishing false information.

In a sentencing hearing yesterday morning Hodge M. Malek, QC, a UK-based consultant acting on behalf of the Crown, listed the evidence against IPOC and its subsidiaries, Lapal Limited, Albany Invest Limited, and Mercury Import Limited, all BVI incorporated IBCs (international banking companies).

Lapal and Mercury Import were each ordered to pay $600,000, and fined $100,000, both to be paid within seven days. Albany Invest was sentenced to pay $1 million and fined $100,000, also to be paid within seven days. All three IBCs were fined a total of $2.5 million dollars.

Mr. Malek told BVI High Court Jusice Indra Hariprashad-Charles that in answer to allegations of money laundering, Michael North, president of IPOC, and Jeffrey Galmond, the fund's beneficiary owner, produced a report authored by the accounting firm Ernst & Young detailing consultancy agreements in 2004.

But those documents allegedly contained misleading information, including forged signatures. Ernst & Young never independently verified the information in the documents, but relied on the information given to them, according to Mr. Malek.

The five documents were the basis of two charges of perverting the course of justice and furnishing false information, which all four companies plead guilty to earlier this week.

In the BVI High Court yesterday, Andrew Mitchell, QC, who represented IPOC, told the Court there was no dispute that IPOC received pecuniary benefits from the illegal actions, which according to Mr. Malek, tied up MegaFon stakes to the advantage of IPOC.

The Russian telecom provider MegaFon is reportedly worth around $10 billion.

Mr. Malek advised the court to confiscate all of IPOC's holdings in the jurisdiction, which amounts to a little over $45 million — held by the High Court since 2004 — and invited the court not to impose an additional fine.

He also asked that the three BVI-domiciled IBCs pay a part of the Crown's "substantial" legal fees, which have surpassed $2 million, and suggested a fine of $150,000 for each company.

In mitigation, Mr. Mitchell told Justice Chares that IPOC has settled the entire course of its global civil litigation and plead guilty at the earliest possible opportunity.

Richard Kovalevsky, Q.C., who represented Lapal, Albany and Mercury, said his clients were soon going to begin the liquidation process in the BVI, and that they had no interest whatsoever in being traded. Lapal, Albany and Mercury are all holding companies, and Mr. Malek requested that the companies not be traded in the interim before they are wound up.

Mr. Malek also commended the work done by the Bermuda Police and Royal Virgin Islands Police Force and the Attorney General's office of the BVI and Bermuda, saying that well over a half million pages of documents were produced during the two-year investigation.

The Court broke for around half an hour, during which time lawyers prepared the legal documents. Ultimately, a sum of a little over $45 million was confiscated from the Bermuda-based fund.

BVI Director of Public Prosecutions Terrence Williams said this was the first time he recalled a corporation be tried in criminal court during the nine years he has served as a prosecutor in the territory.

Justice Charles that she would deliver a written judgement, customary in BVI criminal proceedings, soon after.

It is "not envisioned in the BVI or Bermuda there will be future allegations" against IPOC said Mr. Malek. "So really this is the end of the IPOC saga in every case."