A French citizen with ties to BSG Resources Ltd. was denied bail while he waits for trial on charges he interfered with a U.S. grand jury probe of claims that BSGR paid bribes to win mining rights in Guinea.
U.S. District Judge William Pauley in Manhattan today ruled that Frederic Cilins, 50, presents “a serious risk of flight,” throwing out an earlier $15 million bond set for Cilins’ release. Pauley also today scheduled a Dec. 2 trial.
Cilins is charged with offering money to Mamadie Toure, whom prosecutors claim was the fourth wife of Guinea’s late President Lansana Conte, to lie to U.S. investigators about the alleged bribery scheme and to give him original contracts sought by the grand jury so he could destroy them. Prosecutors said they have recordings of meetings and phone calls between Cilins and Toure, who is cooperating with the investigation.
Cilins claims the contracts are fake and that he met with Toure to try to prevent her from extorting money from him and BSGR. He has pleaded not guilty.
On May 15, U.S. Magistrate Judge Frank Maas in Manhattan ordered Cilins held on $15 million bond to be secured by $5 million in cash or property and the signatures of five financially responsible people.
Maas also said Cilins would be required to stay in his Turnberry Isle, Florida, vacation home, with electronic monitoring and be guarded 24 hours a day by armed security. His lawyer, Michelle Smith, argued that he should be released after posting $3.6 million in real estate. Both sides appealed the bail ruling.
“This court finds that Mr. Cilins is a serious risk of flight and that there are no conditions that will ensure his appearance in court,” Pauley said today at the end of a two-hour hearing. Cilins is in custody in New York.
Smith declined to comment on the ruling. She said she will consult with her client to decide whether to appeal the decision to the federal appeals court in New York.
Cilins has a “very close personal relationship” with Beny Steinmetz, who controls BSGR and is the wealthiest person in Israel, a U.S. prosecutor claimed in April. The government said Cilins was negotiating with Toure on behalf of BSGR and Steinmetz when he was arrested April 14 at the airport in Jacksonville, Florida.
In a sworn complaint dated April 15, Peter Kilpatrick, a special agent with the Federal Bureau of Investigation, said that Cilins told Toure in a March 20 phone call that an unidentified “high-ranking individual” within the company had agreed to pay her the amount of money she requested for the destruction of the contracts.
Cilins is charged with witness tampering, obstructing a criminal investigation and destruction of evidence in a federal investigation. The witness-tampering and record-destruction charges carry maximum prison terms of 20 years.
“Beny Steinmetz denies any knowledge of wrongdoing in relation to any ongoing FBI investigations,” Conal Walsh, a spokesman for Steinmetz with Powerscourt, said in an e-mail last month. “Mr. Steinmetz has an impeccable reputation and has faced no evidenced allegations anywhere.”
Cilins said he worked in 2005 and 2006 for BSGR as a go-between with Guinea in the company’s efforts to secure mining rights in the country’s Simandou region.
In a court filing, Cilins said Toure wasn’t actually married to Conte, who died in 2008 after ruling the West African nation for 24 years. He claimed Toure is lying to prosecutors to remain in the U.S. and avoid prosecution in Guinea.
Prosecutors claim Cilins and others visited Toure in Guinea when Conte was in office to offer $12 million to Toure and senior members of Conte’s government for their help in securing the mining rights. The arrangement was allegedly reflected in a series of contracts that Cilins later tried to get Toure to “urgently destroy,” according to the government.
Smith today argued that her client can’t be prosecuted because the contracts are fake.
Prosecutors said Cilins told Toure, in a recorded conversation, that he went to an unidentified co-conspirator to talk about the U.S. investigation. In a whisper, Cilins said he told the co-conspirator that Toure would never betray him or turn over documents, according to a transcript of the conversation quoted in a court filing by prosecutors last month.
“He told me ‘That’s good, but I want you to go see -- I want you to tell me, ‘I saw that the documents [noise] were destroyed; it’s over, there are no more documents,’” according to the filing.
Cilins, whose wife, four children and other family live in Antibes, France, may try to flee if released before trial, prosecutors argued. Cilins said that he and his partners, Avi LevRan and Michael Noy, have done business in Africa, Canada and South America.
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