COMPULSORY LIQUIDATIONS Cayman Islands British Virgin Islands E Caribbean Bahamas Bermuda Guernsey London Cyprus CISCEE USA Founded in 2007 in the Cayman Islands KRyS Global is an international fraud investigation and dispute resolution firm The firm has grown to over 65 ID: 545860
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STATEMENT OF QUALIFICATIONCOMPULSORY LIQUIDATIONS
Cayman Islands
British Virgin
Islands (E. Caribbean)
Bahamas
Bermuda
Guernsey
London
Cyprus
(CIS/CEE)
USASlide2
Founded in 2007 in the Cayman Islands,
KRyS
Global is an international fraud investigation and dispute resolution firm. The firm has grown to over 65 outstanding professionals working from nine offices worldwide, predominantly situated in offshore financial centres. KRyS Global has built an enviable reputation for timely, proactive and innovative solutions, particularly in situations of uncertainty, leveraging the knowledge and experience of our professionals and incorporating practical common sense in ensuring positive outcomes for our clients. All of our service lines have an ultimate focus on achieving positive outcomes and recoveries for our clients and stakeholders. And whilst many of our professionals hold accountancy qualifications, we do not offer audit or tax advisory services. We prefer to avoid conflicts of interests and we value the independence and free-thinking that empowers. In all that we do, we continuously strive to be innovators within our field. We are a unique firm offering sophisticated but practical solutions to complex issues. Our approach and the successful outcomes our clients enjoy are unrivalled.
KRYS GLOBAL BRINGS UNIQUE CAPABILITIES TO SOLVING COMPLEX CROSS-BORDER CASES
KRyS-Global.com
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ABOUT
KRYS GLOBALSlide3
Offshore liquidations usually arise from two situations:
Insolvency
, where either: a. An unpaid creditor demonstrates to the court that the debtor cannot pay its debts, b. The Directors have concerns with the solvency of the company, or c. Court supervision is needed to address certain breaches of regulatory laws;The court considers it is just and equitable to investigate the affairs of the company, usually in instances of fraud.Offshore companies are unique and require professionals that have extensive experience in coordinating activities and formulating successful litigation strategies in cross-border scenarios. While the facts surrounding each liquidation will be different, offshore liquidations share certain typical characteristics:Minimum documents maintained offshoreThe assets, creditors, service providers, directors and management are likely to exist in multiple jurisdictions;
The “business” of the company is usually financial service oriented.
Offshore liquidators need to collect relevant information and recover assets in a cost-efficient manner, skirting the pitfalls and risks that commonly can arise. They need to demonstrate credibility and independence locally, while also having extensive experience of the laws, opportunities and limitations of other jurisdictions. The best offshore liquidators are transparent, and can explain the strategy they recommend to go directly from point A to point B, avoiding unnecessary delays and wasting limited resources. These are the distinguishing factors that the KRyS Global team brings to all their engagements.
KRyS
Global prides itself on always being independent and conflict free.
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LIQUIDATIONSSlide4
Offshore insolvent liquidations are somewhat different than their onshore counterparts. They normally involve a financial services business,
and can
be conducted from anywhere, with the principals often located onshore, along with the creditors or investors (although not necessarily in the same jurisdiction). Offshore insolvencies usually mean the company has a shortfall in assets, or distressed/illiquid assets, which causes the company unable to settle its debts as they fall due. In these scenarios, the objective will be to maximize the estate and distribute to creditors/investors in an orderly and transparent fashion. In order to maximize the value in an offshore insolvency, one needs to move quickly to ascertain where the books and records and the assets may be located, and then to pursue these in a cost efficient manner. This usually requires working closely with directors and service providers. And where such assistance is not forthcoming, consideration needs to be given to seeking recognition onshore or seeking court assistance.The professionals at KRyS Global have a wealth of experience in working with service providers and moving quickly to procure and secure assets. Statutory avoidance claims may need to be considered. We are the leaders in getting recognition in the US, Canada, and elsewhere, and have had significant success in getting court assistance where appropriate. Also to the extent assets are illiquid or problematic to realize, KRyS
Global has an extensive network of contacts to monetize an asset. Where the asset is underperforming,
KRyS
Global’s team can restructure and manage the data rooms and sale process to
maximise the value of the assets.
In non-contentious type scenarios, it is
KRyS
Global’s
goal to maximize value, distribute and exit the proceeding as quickly as possible, to ensure the remaining assets are preserved for the benefit of the stakeholders. This is achieved through experience and an understanding of how offshore companies operate, to ensure the cooperation of the correct parties and that energies and costs are focused on the right areas.
KRyS Global is willing to take a flexible approach to its fee structures,
ensuring that
our interests are aligned with those of the
stakeholders, mitigating the risk of further loss in uncertain situations.
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INSOLVENCYSlide5
The need for experience and creativeness increases where a company is being wound up on a just and equitable petition due to fraud. Getting access to books and records and assets will be more difficult. Consideration will need to be given to use the broad powers that are available as
liquidator
and pursuing litigation against those who breached their contracts, or were negligent, willfully blind or fraudulently negligent (or aided and abetted those that did). Claims for actual or constructive trust may need to be pursued. The professionals at KRyS Global are experienced in formulating and managing legal strategies across numerous jurisdictions with a view to identifying and bringing in ‘low hanging fruit’ in order to make some quick wins in the early stages of the liquidation, without incurring excessive costs. In gathering and analyzing information, KRyS Global has a number of qualified forensic accountants and certified fraud investigators who know how to pinpoint the issues and, using an appropriate dose of professional skepticism, will
review and corroborate the evidence throughout the process. Because we have professionals who have acted as experts and compiled evidence for court purposes, the field work is done in-house
meaning it is done expeditiously and more cost effectively. We use attorneys and consultants who share a common passion and innovative thinking to fraud investigations.
We at
KRyS Global have a proven track record of being a trail blazer, having obtained numerous precedent setting judgements onshore and offshore in recovering assets for the benefit of
victims of fraud.
We’ve managed some of the largest and most complex fraud investigations offshore.
KRyS Global works with a number of litigation funders and has experience in negotiating litigation funding to provide maximum benefit to the stakeholders for minimum risk.
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FRAUD INVESTIGATIONSSlide6
SELECTED ENGAGEMENTS
We have compiled a selection of our previous work to showcase our strengths and
experiences.Slide7
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MMIPThis case involved a Cayman Islands fund that had significant illiquid assets after the 2008 financial crisis. The company initially was put into voluntary liquidation and upon concerns regarding the solvency of the fund, KRyS Global was appointed jointly with the voluntary liquidators as court liquidators to wind up the estate. Procured and secured the illiquid assets. Investigated alternative options for monetization and discussed these with the Liquidation CommitteeConducted an investigation into the activities of service providers, concluding there were no cost effective cause of action
Adjudicated the outstanding redemption claims, determining that the claims should be rejected. Were advised to possibly revisit the decision upon developments in the Cayman court on redemption matters, and sought direction from the Court to proceed to distribute the assets based on earlier decision
Result
: Cash and en specie
distribution to investors of assets of the fund.
This case involved a local domestic insurance company operating in Jamaica and the Cayman Islands that suffered significant losses arising from Hurricane Ivan in September 2004. Appointed jointly with a Jamaican insolvency practitioner. Initial projections were in the region of 30%.
Effective coordination of activities and reporting across two jurisdictions, Jamaica and Cayman Islands
Threatened
and ultimately negotiated a resolution with the Jamaican regulators as to whether the assets they held as guarantee for insurance license would be limited to Jamaican creditors or distributed
pari passu
among Jamaican and Caymanian creditors.
Investigated
and commenced litigation against the insurance broker, resulting in a settlement for the benefit of creditors
Adjudicated
and/or negotiated numerous property and personal injury claims
Result
: Creditors received 86% return on their claims. DYOLL CASE STUDIESHIGHLIGHTSHIGHLIGHTSSlide8
This case involves three British Virgin Islands feeder funds caught up in the Madoff fraud with losses exceeding $6 billion. KRyS Global was appointed liquidator by the BVI Court to investigate the fraud and explore recovery strategies
.
Coordinating the compilation of records from five jurisdictions.The fund had nominal unrestricted cash assets at the time of appointment. Conducted an extensive investigation into potential causes of action that could be taken, assessing the potential roadblocks and defenses that may be taken and compiling a comprehensive litigation strategy that focused recoveries on primary defendantsObtain leading precedent chapter 15 recognition in the US which allowed liquidators to take control of the litigation strategy and pursue certain asset recoveries in the US.
Negotiating a unique settlement with the US Trustee for Madoff who had substantial claims against the Funds, which includes opportunity for estate to benefit from US Trustee’s recovery efforts as well as its own
Employing
an anti-suit injunction to cease a priority claim in the Netherlands and recover $70 million.
Obtaining Court decisions in the US which allowed liquidator to exit the sale of an asset sold at an undervalue which brought additional assets of $80 million into estate.
Currently
pursuing litigation strategies in four jurisdictions seeking to recover billions of
dollars
lost.
Result
(to date): Recovery of over $300 million despite
no significant unrestricted cash funds when appointed.
SEXTANT
FAIRFIELD
This case involved two Cayman Islands funds that were subject to a $60 million fraud. Originally appointed by the local regulators to investigate the fraud, KRyS Global was subsequently appointed as court liquidators to pursue the remaining assets and to explore litigation to recover missing
assets
.Books and records relevant to the funds’ affairs were located Cayman, Bermuda, and Canada. In addition records that could assist in determining where assets had been invested or diverted were in the US, Luxembourg and Ireland. Coordinating the compilation of records and pursuit of assets across multiple jurisdictions. As the principal was not assisting the liquidators, court recognition obtained in the US to gain access to records surrounding diverted fundsIn addition a protocol was entered with a Canadian receiver who was investigating an affiliated case to share records and pursue joint recovery actions. Pursuit of the principal resulting in a settlement and full accounting for diverted funds.
An
investigation into the conduct of the service providers identified potential causes of action for breach of conduct or negligence.
Result
: Full repayment to creditors and assignment of remaining assets and potential causes of action to redeemer claimants
CASE STUDIES
HIGHLIGHTS
HIGHLIGHTSSlide9
Grant.Lyon@KrysGlobalusa.com
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KENNETH M. KRYSFounder & Executive Chairman TIMOTHY LE CORNUManaging Director • Guernsey GRANT LYONManaging Director • USAMATHEW CLINGERMANManaging Director • Bermuda
Kenneth.Krys@KRyS-Global.com
Charlotte.Caulfield@KRyS-Global.com
Timothy.LeCornu@KRyS-Global.com
Mathew.Clingerman@KRyS-Global.com
MANAGEMENT
TEAM
Michael.Schulz@KRyS-Global.com
CASEY MCDONALD
Managing Director
•
Cayman
Casey.McDonald@KRyS-Global.com
CHARLOTTE CAULFIELDManaging Director • BVI
JOHN SKELTON
Managing
Director •
London
John.Skelton@KRyS-Global.com
KRyS-Global.com
MICHAEL SCHULZ
Director
•
Bahamas