BY JAMES BONE IN NEW YORK AND DAVID LISTER
The Time of London
November 5, 1999

NEW YORK banking regulators were warned more than a year ago that Russian bankers were using an offshore company in the British Virgin Islands to pay "bribes" in Washington, according to sworn testimony obtained by The Times.

A confidential witness told the New York State Banking Department last year that a company set up as part of an alleged money-laundering scheme by Russian bankers was also being used to make what were described as "contributions".

He identified the company as Whalesdon Financial Company, with account 826.416.310.333.01 at the Bank of Liechtenstein.

Whalesdon was "used for what was coded as contributions to American contacts - Washington and so on", the witness told investigators. "The code name was contributions. To me it's [a] bribe."

According to documents in the British Virgin Islands Whalesdon Financial Company was registered on May 25, 1992, but was struck off on November 1, 1995, after failing to pay its licence fee to the Registry of Companies. No details of shareholders or directors are given for the company, which is registered to an address in Road Town, Tortola.

The firm is one of a web of offshore companies allegedly established by the principals of Inkombank to loot the bank. Inkombank collapsed last year and its shareholders are now suing the Bank of New York, which handled its dollar transactions as its correspondent bank in the US, for "knowingly" facilitating the embezzlement. The Bank of New York denies the charge.

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