US president Donald Trump’s decision to give a “serial fraudster”, who used a Cayman-registered company in his schemes, an early release from jail signalled to criminals it was “open season and business as usual”, a Cayman Islands company liquidator has said.
Chris Johnson, of Chris Johnson Associates, a Cayman-based chartered accountants and insolvency firm, explained he and colleague Russell Homer, the two court-appointed liquidators, had obtained judgments of more than $60 million against US man Jason Galanis after “hundreds of hours of investigation”.
Galanis had been serving a 14-year-sentence, but was released at the start of this month after serving fewer than nine years when Trump commuted his sentence.
Galanis used the Cayman-registered Wimbledon Financing Master Fund, as well as other vehicles, as part of his fraudulent activities.
The former business associate of Hunter Biden, the son of Democrat ex-president Joe Biden, was jailed in 2017 after he admitted securities fraud based on bonds issued to a company linked to a Native American tribe in South Dakota.
The convictions were later vacated, but Galanis pleaded guilty in 2020 to fraud charges related to the tribal bond scheme and to another company, Gerova.
The money was supposed to be used for economic development projects, but instead were used by Galanis for his own benefit.
Johnson said, “The liquidators uncovered major frauds perpetrated by Galanis and his co- conspirators.”
He added “some satisfaction” had been gained by the two Cayman professionals after Galanis was jailed.
But Johnson said, “By releasing Galanis, Trump has effectively sent a message to financial fraudsters that it is open season and business as usual for them to continue their criminal activities.”
Trump on 28 March ordered the Bureau of Prisons to let Galanis out of jail.
He also issued a full pardon to Devon Archer – another former associate of the younger Biden – who was sentenced to more than a year in jail in 2022 for defrauding a Native American tribal entity.
Audrey Strauss, then the acting United States attorney for the Southern District of New York, said after Galanis was sentenced in 2020, “Jason Galanis orchestrated two multi-million dollar frauds schemes and hid behind a team of co-conspirators to conceal his involvement and defy and SEC ban.
“He and his co-defendants engaged in market manipulation and the defrauding of shareholders and they stole a large portion of the proceeds of tribal bonds that were intended to fund economic development projects.”
She added that Galanis had been sentenced to “a lengthy prison term that reflects the magnitude and pervasiveness of his crimes”.
Galanis and Devon brokered business ties with Hunter Biden and were later found guilty of unrelated fraudulent schemes.
They had pleaded with former President Biden for clemency and accused the politician’s son of capitalising on his name to help set up business deals overseas.
The two Caymanian liquidators had no involvement in the controversy involving Galanis and the Bidens.
Galanis testified in front of the US House Oversight and Accountability Committee about Biden family business arrangements.
He alleged from the Alabama prison where he was serving his sentence that Joe Biden, who later won the White House in 2020 after his time as vice president under Barack Obama, had a greater involvement in his son’s business dealings than he admitted.
He told the committee that “the entire value add of Hunter Biden to our business was his family name and his access to his father, Vice President Joe Biden.”
Biden senior denied wrongdoing, and Republican opponents could not provide any evidence that he used his position to assist his son’s business activities.
A House impeachment inquiry into Hunter Biden’s business deals during and after his father’s time as vice president finished last August without drawing up any articles of impeachment against the older Biden, by then president.