Trouble in Paradise - BVI and Reputational Due Diligence

In late April 2022, Andrew Fahie, the Premier (i.e. Prime Minister) of the British Virgin Islands, was arrested in Miami for alleged drug smuggling and money laundering. According to the BBC, Fahie was arrested in a sting operation by US DEA agents posing as cocaine traffickers from a Mexican drug cartel. It is alleged that he agreed a $700,000 (£560,000) payment to allow traffickers to use BVI ports with an undercover informant.

These events come on top of a report from a UK Commission on Inquiry which, again per the BBC, described governance in the BVI as "appallingly bad", calling for a two-year suspension of the constitution, cessation of the elected ministerial government and the direct rule of the UK appointed governor.

Applying Reputational Due Diligence

Current allegations levied against the BVI Premier clearly do not involve the fund management industry in Tortola. However, this is an example where Reputational Due Diligence ("RDD") becomes invaluable: as we frequently say, the first rule of due diligence is not to be surprised. Using Castle Hall's RDD tools, you can determine if your portfolio and organization has any exposure to the BVI during this time of uncertainty.

First, Using our DiligenceExpress database of Form ADV information, Castle Hall identified more than 630 private funds managed by SEC Registered Investment Advisors which are listed as being domiciled in the BVI. Total assets of these funds exceed $210 billion per current filings with the SEC. 

Access to DiligenceExpress is free - if you have not already done so, please sign up to the Castle Hall platform. With access to DiligenceExpress, you can check your managers and funds to determine if any are domiciled in the BVI and potentially exposed to political risk in this jurisdiction.

Second, Castle Hall's Reputational Due Diligence Profiles allow you to check management companies and individual executives (as well as service providers and portfolio companies) across several thousand sanctions, anti-money laundering, anti-bribery and corruption and politically exposed person databases, together with a powerful, AI enabled search of adverse media. Are any of your management companies and executives linked to any individuals alleged to be involved in corrupt activities?

Third, Castle Hall's daily RDD monitoring delivers media content from Dow Jones Factiva, the leading media source accessing more than 30,000 premium titles including the Wall Street Journal. Monitoring also includes ongoing review of other adverse media and checks to sanctions and watch lists around the world.

Click below to schedule a demo of Castle Hall’s Reputational Due Diligence services.

Alternatively, contact solutions@castlehalldiligence.com to learn more about how the Castle Hall team can support your due diligence process.