Barclays and HSBC have been accused of enabling a late real estate tycoon to siphon cash from trusts intended for his daughter into a massive money-laundering scheme — including deals that were brokered by an entity linked to Ghislaine Maxwell’s family, according to a bombshell court filing.
Tanya Dick-Stock and her husband Darrin Stock sued the banks in December, alleging they helped her late father John Dick Sr. turn trusts including one valued at $350 million into a piggy bank to facilitate illicit transactions for a rogue’s gallery that included two siblings of convicted child sex trafficker Ghislaine Maxwell.
In a new filing in Colorado federal court, the couple claims banks neglected their duty to “Know Your Customer,” or KYC, under the anti-fraud and money-laundering regulations that govern financial institutions They also claimed the fraud was larger than previously known, and sought another $3 billion on top of the original $12 billion they sought from the banks, factoring in interest and damages.
The “industry-wide money laundering schemes” could not have happened without “global banks willing to accept coded accounts, forgo meaningful and required … obligations, move funds without contemporaneous documentation, and process transactions whose true economic substance was deliberately obscured,” the new filing states.
Barclays and HSBC and some of their subsidiaries, plus a trust company called Zedra, allegedly tricked creditors, avoided taxes and hid cash through a since-shuttered offshore trust business called La Hougue, which later morphed into Pantrust.
The Stocks, who are repped by former presidential candidate and ex-Sen. John Edwards, previously claimed they found evidence of the fraud in a locked squash court on their former 400-year-old estate on the Isle of Jersey, an offshore tax haven.
La Hougue was on a list of 72 people and entities about which the Senate Finance Committee is seeking information in connection with its probe of late financier and sex offender Jeffrey Epstein, Ghislaine Maxwell’s longtime associate.
Courtesy of Ian Maxwel
Maxwell’s brothers Kevin and Ian Maxwell were allegedly in the thick of La Hougue’s activities.
“Throughout the mid-1990s, La Hougue moved money, established shell companies, and engaged in financial schemes with Kevin and Ian Maxwell,” the amended complaint states.
A spokesperson for the brothers previously told the Times of London they had no “knowledge of any tax avoidance or other schemes purportedly organised by La Hougue”.
A rep for the brothers did not answer a Post request for comment.
The Stocks’ lawsuit describes the extent of the fraud as “staggering,” claiming “hundreds of millions of dollars simply disappeared.”
“Facilitating money large scale laundering schemes was part of the business plan for the Barclays and HSBC defendants … And all the while, Defendants continued to reap enormous profits.”
HSBC strongly denied the allegations, saying it would fight them in court.
“HSBC operates a robust financial crime compliance program with industry leading controls,” the bank said in a statement.
In an unrelated case, HSBC admitted in 2012 to money laundering for violent drug cartels and moving funds for US sanctioned countries including Iran. HSBC paid the US government a then-record $1.92 billion fine in a controversial deferred prosecution agreement.
Barclays and Zedra declined to comment.
The amended complaint “paints a wider picture of a whole range of enablers acting together in extraordinary ways,” said John Christensen, a former senior economic advisor to Jersey and co-founder of the Tax Justice Network.
“HSBC failed its regulatory duties when they took over from Barclays and that raises questions about their compliance policies,” he added.
“It’s a groundbreaking case. Lawyers say this could change the nature of the relationship between the banks and their clients who are trusts. They will have to demonstrate a much greater duty of care to their clients.”
James S. Henry, co-founder of United Against Money Laundering and a Global Justice Fellow at Yale, described the case as “a role model for holding banks responsible for violations of trusts.”
“In this age of financial corruption, it’s now down to private litigants who have lost billions of dollars to fight big banks. It’s hard to find litigators, and it’s a miracle they filed,” he said.
The next step in the case is for the plaintiffs to respond to the amended complaint. Court dates for discovery and depositions are expected to follow this fall.
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