Government is set to receive a multi-million-dollar windfall as its share of $45 million confiscated from the Bermuda-based IPOC International Growth Fund following a criminal conviction against the Fund in a British Virgin Islands court.

Sentencing took place yesterday in a case which saw IPOC and three of its BVI-domiciled subsidiaries, Albany Limited, Mercury Import Limited and Lapal Limited, plead guilty to furnishing false information and perverting the course of justice.

Bermuda and BVI authorities cooperated in the case, compiling evidence comprising half a million documents.

Finance Minister Paula Cox revealed that the two British Overseas Territories had agreed a deal on the confiscated cash, but did not say how much of the $45 million Bermuda would be entitled to.

"This confiscation is one of the largest in a common law jurisdiction," Minister Cox said yesterday. "The agreement between the Government of Bermuda and the Government of the British Virgin Islands sets out how the confiscated assets will be shared between our two jurisdictions. "On behalf of the authorities in Bermuda, I wish to thank and congratulate the authorities of the British Virgin Islands for their excellent cooperation in this very necessary and vital regulatory enforcement action."

The BVI High Court ordered the three BVI companies to pay $2.3 million in legal costs and fined them $300,000.

"The nature of the investigation, the wide-ranging scope and interlocking network of companies has required considerable detailed investigation, analysis of the corporate structure and on-site visits to other jurisdictions," Minister Cox added.

"This was no simple task. It was also a very costly exercise. However, Bermuda's reputation as a well-regulated financial centre was on the line and the Government had a duty to protect it."

The Finance Ministry has asked the Supreme Court to wind up IPOC, a case which has yet to be concluded.

The legal saga surrounding the Fund has dragged on since 2003. In a written request for assistance from the US Justice Department, BVI Director of Public Prosecutions Terrence Williams alleged that IPOC "was simply a front for the laundering of proceeds of crime of, amongst others, the Russian Telecommunications Minister, Mr. Leonid Reiman".

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