20 MILLION DOLLAR TIMELINE
20 MILLION DOLLAR TIMELINE February 28, 2004 - Government grants additional incentives to International Development and Management Ltd. for the development of Clarke Hall Estate January 11th, 2005 - By stock purchase agreement Felix Chen and Sino Union agreed to purchase a 40% equity interest in Shangri-La International Development Holding Limited for 20 million U-S dollars Shangri-La owns the assets of the failed Layou River Economic citizenship programme. Those assets include but are not limited to 403 acres of land, the original Layou River Hotel, the fraudulent concrete of the ill-fated five star hotel and the millions left over from the approximately 80 million collected by Grace Tung and company from the sale of more than 500 Dominican passports. If 20 million U-S dollars (54.3 million EC) gave Sino Union 40% of Shangri-La, it means that at the time of the transaction Shangri-La was valued at 50 million U-S dollars or 135.8 million EC. That 50 million US dollar enterprise with an asset base derived from the failed economic citizenship programme at Layou is owned by another company called Rich Victory Investments Ltd. The mastermind behind Rich Victory is Dominica’s Ambassador to Beijing David Hsiu – Grace Tung’s business partner in the Layou scheme. March 11, 2005 - Agreement of February 28, 2004 amended But after Ambassador Hsiu reached agreement to sell the 40% stake in Shangri-La to Sino Union and received a 7 million U-S dollar deposit as previously arranged, he had a change of heart. According to King and Wood, the attorneys for Rich Victory, “due to the fact that the Commonwealth of Dominica was about to hold a general election then and, as 1|Page
our client was not certain as to whether the political party he supported would win the general election, our client offered as a gesture of good faith, to refund the deposit (from Sino Union) pending the result of the election”. The Dominica Labour Party won the election on May 5th 2005 and three weeks later, on May 26th, 2005, the Sino Union paid in full the 20 million US dollars requested by Rich Victory for 40% of its shares in Shangri-La. November 18, 2005 - Lucy Ma director of Rich Victory writes to PM Skerrit advising him that arrangements have been finalised for the transfer of Rich Victory’s 51% shareholding in Shangri-La ($69.3 million) to the Government of Dominica on the eve of the official opening of the first phase of the Layou development project or sooner if mutually agreed November 28, 2005 - PM writes to Felix Chen “Please be informed that my Government has officially received from Rich Victory Investment Limited transfer of its 51% equity of record in IDM’s parent company”. NOTE:
IDM’s parent company is the Shangri-La International Holdings Limited The 51% equity in Shangri-La carried a May 2005 value of 25.5 million U-S dollars or 69.3 million EC dollars Letter copied to Ambassador David Hsiu and Ambassador Ye Dabo Letter delivered to Felix Chen in China by David Hsiu’s assistant
76 days later... February 12, 2006 - PM signs as transferee a Shangri-La International Development Holding Limited Instrument of Transfer: “We Rich Victory Investment Limited, a company incorporated under the laws of the British Virgin Islands (the transferor) in consideration of the sum of one U-S dollar paid to us by the Government of the Commonwealth of Dominica (the 2|Page
transferee) do hereby transfer to the transferee twenty five thousand five hundred shares of Shangri-La International Development Holding Limited”. The signatories on that Instrument of Transfer are Rebecca Chang and Lucy Ma directors of Rich Victory - the transferor; Roosevelt Skerrit representing the Government of Dominica as transferee; and Kieron Pinard-Byrne as witness. NOTE:
Copy of signed document was delivered to Felix Chen in Dominica by Kieron Pinard-Byrne
April 19, 2006 - PM writes to Felix Chen “I refer to our meeting on April 18, 2006 and hereby confirm my government’s summary position on key issues as discussed... “... The appointment of KPB Chartered Accountants as the company’s auditors is hereby ratified... Finally, I would note that the existing disputes amongst the company’s shareholders needs to be resolved to ensure the future success of the company. I therefore hereby mandate that the company expands the scope of the Auditor’s engagement to make recommendations for the resolution of all such disputes and that the disputing shareholders fully cooperate with the company’s auditors to ensure that the mediation process is carried out as a matter of urgency”. NOTE:
Letter copied to Ambassador David Hsiu and Kieron Pinard-Byrne Letter delivered to Felix Chen in Dominica by Rebecca Chang
April 27, 2006 - Kieron Pinard-Byrne writes to Sino Union (Felix Chen) confirming that in the matter of Government shares in Shangri-La, he is in possession of a duly executed Directors Resolution to effect and issue the share certificate through the Shangri-La’s registered agent
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“As you are aware I have been holding the executed transfer in escrow pending completion of the first phase of the project but recent instructions are that registration must now proceed...” May 03, 2006 - PM writes to Felix Chen “You have requested the company’s auditors to advise you on who will be the director representing the Government of Dominica in Shangri-La. “Please be advised that Shangri-La’s present Board of Directors should remain in place until the company’s Annual General Meeting of shareholders expected to be held within the next two months. Government will therefore not appoint a representative to the Shangri-La Board until the meeting. “In the circumstances, we shall continue to liaise on all corporate matters for which government’s instructions and/or advice is required through Mr. Kieron Pinard-Byrne of KPB Chartered Accountants, the company’s auditors. NOTE:
Letter copied to Ambassador David Hsiu and Kieron Pinard-Byrne, KPB Chartered Accountants Letter was faxed to Felix Chen in China from the office of Kieron Pinard-Byrne in Dominica
June 13, 2006 - Auditor Keiron Pinard-Byrne questions the compatibility of the equity voting rights of Government as the majority shareholder with certain provisions of the agreement June 19, 2006 - Ambassador David Hsiu writes to PM Skerrit resigning as Government’s honorary Liaison officer for Clarke Hall Estate Development projects and confirming formal recognition of Government’s majority shareholding in Shangri-La August 29, 2006 - Kieron Pinard-Byrne writes to the Board of Directors of ShangriLa confirming receipt of share application forms from the Government of Dominica in respect of its 51% stake in Shangri-La 4|Page
November 4, 2006 - PM Skerrit writes to Ambassador David Hsiu objecting to the May 2005 sale of Rich Victory shares to Felix Chen and accusing Ambassador Hsiu of using concessions granted by government for personal multi-million dollar profit. That letter referred to the Ambassador’s conduct in the matter as unacceptable, intolerable, irresponsible, and against the people’s interest. Significantly, the Prime Minster also asked his Ambassador to repay Mr. Chen the 20 million U-S dollars used to purchase the 40% interest in Shangri-La November 24, 2006 - Instrument of Transfer cancelled according to Pinard-Byrne September 28, 2007 - Attorneys for Rich Victory Investments Ltd King and Wood: “In the auditor mediation report... you will note that at a certain point in time, our client intended to transfer our shares in Shangri-La to the government of the Commonwealth of Dominica... The proposed transfer of the shares to the government was never complete and our client still remains the 55% shareholder of Shangri-La”. That September 28, 2007 correspondence to Deloitte and Touche, auditors for the Sino Union also contains a threat to wind up Shangri-La in the British Virgin Islands sometime after October 12, 2007 November 8, 2007 - Prime Minister Roosevelt Skerrit tells parliament that “the Government of Dominica owns the equitable interest in the majority shares in Shangri-La” February, 2008 – Hsiu files suit in the BVI seeking to liquidate the Shangri-La. The government of Dominica is not named as a party to the action. May, 2008 – Felix Chen files suit in the BVI seeking a rectification of the share register of the Shangri-la and names the government of Dominica as a defendant. June 02, 2008 – Prime Minister Skerrit files an affidavit on behalf of the government of Dominica
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our client was not certain as to whether the political party he supported would win the general election, our client offered as a gesture of good faith, to refund the deposit (from Sino Union) pending the result of the election”. The Dominica Labour Party won the election on May 5th 2005 and three weeks later, on May 26th, 2005, the Sino Union paid in full the 20 million US dollars requested by Rich Victory for 40% of its shares in Shangri-La. November 18, 2005 - Lucy Ma director of Rich Victory writes to PM Skerrit advising him that arrangements have been finalised for the transfer of Rich Victory’s 51% shareholding in Shangri-La ($69.3 million) to the Government of Dominica on the eve of the official opening of the first phase of the Layou development project or sooner if mutually agreed November 28, 2005 - PM writes to Felix Chen “Please be informed that my Government has officially received from Rich Victory Investment Limited transfer of its 51% equity of record in IDM’s parent company”. NOTE:
IDM’s parent company is the Shangri-La International Holdings Limited The 51% equity in Shangri-La carried a May 2005 value of 25.5 million U-S dollars or 69.3 million EC dollars Letter copied to Ambassador David Hsiu and Ambassador Ye Dabo Letter delivered to Felix Chen in China by David Hsiu’s assistant
76 days later... February 12, 2006 - PM signs as transferee a Shangri-La International Development Holding Limited Instrument of Transfer: “We Rich Victory Investment Limited, a company incorporated under the laws of the British Virgin Islands (the transferor) in consideration of the sum of one U-S dollar paid to us by the Government of the Commonwealth of Dominica (the 2|Page
transferee) do hereby transfer to the transferee twenty five thousand five hundred shares of Shangri-La International Development Holding Limited”. The signatories on that Instrument of Transfer are Rebecca Chang and Lucy Ma directors of Rich Victory - the transferor; Roosevelt Skerrit representing the Government of Dominica as transferee; and Kieron Pinard-Byrne as witness. NOTE:
Copy of signed document was delivered to Felix Chen in Dominica by Kieron Pinard-Byrne
April 19, 2006 - PM writes to Felix Chen “I refer to our meeting on April 18, 2006 and hereby confirm my government’s summary position on key issues as discussed... “... The appointment of KPB Chartered Accountants as the company’s auditors is hereby ratified... Finally, I would note that the existing disputes amongst the company’s shareholders needs to be resolved to ensure the future success of the company. I therefore hereby mandate that the company expands the scope of the Auditor’s engagement to make recommendations for the resolution of all such disputes and that the disputing shareholders fully cooperate with the company’s auditors to ensure that the mediation process is carried out as a matter of urgency”. NOTE:
Letter copied to Ambassador David Hsiu and Kieron Pinard-Byrne Letter delivered to Felix Chen in Dominica by Rebecca Chang
April 27, 2006 - Kieron Pinard-Byrne writes to Sino Union (Felix Chen) confirming that in the matter of Government shares in Shangri-La, he is in possession of a duly executed Directors Resolution to effect and issue the share certificate through the Shangri-La’s registered agent
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“As you are aware I have been holding the executed transfer in escrow pending completion of the first phase of the project but recent instructions are that registration must now proceed...” May 03, 2006 - PM writes to Felix Chen “You have requested the company’s auditors to advise you on who will be the director representing the Government of Dominica in Shangri-La. “Please be advised that Shangri-La’s present Board of Directors should remain in place until the company’s Annual General Meeting of shareholders expected to be held within the next two months. Government will therefore not appoint a representative to the Shangri-La Board until the meeting. “In the circumstances, we shall continue to liaise on all corporate matters for which government’s instructions and/or advice is required through Mr. Kieron Pinard-Byrne of KPB Chartered Accountants, the company’s auditors. NOTE:
Letter copied to Ambassador David Hsiu and Kieron Pinard-Byrne, KPB Chartered Accountants Letter was faxed to Felix Chen in China from the office of Kieron Pinard-Byrne in Dominica
June 13, 2006 - Auditor Keiron Pinard-Byrne questions the compatibility of the equity voting rights of Government as the majority shareholder with certain provisions of the agreement June 19, 2006 - Ambassador David Hsiu writes to PM Skerrit resigning as Government’s honorary Liaison officer for Clarke Hall Estate Development projects and confirming formal recognition of Government’s majority shareholding in Shangri-La August 29, 2006 - Kieron Pinard-Byrne writes to the Board of Directors of ShangriLa confirming receipt of share application forms from the Government of Dominica in respect of its 51% stake in Shangri-La 4|Page
November 4, 2006 - PM Skerrit writes to Ambassador David Hsiu objecting to the May 2005 sale of Rich Victory shares to Felix Chen and accusing Ambassador Hsiu of using concessions granted by government for personal multi-million dollar profit. That letter referred to the Ambassador’s conduct in the matter as unacceptable, intolerable, irresponsible, and against the people’s interest. Significantly, the Prime Minster also asked his Ambassador to repay Mr. Chen the 20 million U-S dollars used to purchase the 40% interest in Shangri-La November 24, 2006 - Instrument of Transfer cancelled according to Pinard-Byrne September 28, 2007 - Attorneys for Rich Victory Investments Ltd King and Wood: “In the auditor mediation report... you will note that at a certain point in time, our client intended to transfer our shares in Shangri-La to the government of the Commonwealth of Dominica... The proposed transfer of the shares to the government was never complete and our client still remains the 55% shareholder of Shangri-La”. That September 28, 2007 correspondence to Deloitte and Touche, auditors for the Sino Union also contains a threat to wind up Shangri-La in the British Virgin Islands sometime after October 12, 2007 November 8, 2007 - Prime Minister Roosevelt Skerrit tells parliament that “the Government of Dominica owns the equitable interest in the majority shares in Shangri-La” February, 2008 – Hsiu files suit in the BVI seeking to liquidate the Shangri-La. The government of Dominica is not named as a party to the action. May, 2008 – Felix Chen files suit in the BVI seeking a rectification of the share register of the Shangri-la and names the government of Dominica as a defendant. June 02, 2008 – Prime Minister Skerrit files an affidavit on behalf of the government of Dominica
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