OffshoreAlert, November 30, 2002

Claims in news articles that a British information provider had the names of 15 of the 19 September 11 hijackers in its due diligence database BEFORE the attacks are false, OffshoreAlert can reveal.

Global Objectives Ltd., doing business as World-Check, has been credited with the achievement in stories published by several media organizations and the claim has been repeated by the firm and at least one of its business partners.

World-Check is being relied upon by banks such as the Bank of Bermuda and Barclays Bank in the UK for customer identification and monitoring to help them comply with the USA PATRIOT Act and other anti-crime legislation brought about by the September 11 attacks.

However, World-Check's own database shows that entries for all 19 hijackers were only created on September 14, 2001 – the same day their names were first publicly released by the FBI.

World-Check's principal, David Graham Leppan, 29, who was born in South Africa and has an address in Spain, told OffshoreAlert that he was misquoted in an interview with the Associated Press conducted in February, 2002.

"The misquote you are referring to does more damage than good to World-Check," stated Leppan.

But a subsequent brochure and press release distributed by one of World-Check's business partners, NetEconomy, and emails that Leppan sent to OffshoreAlert reinforce the impression created by the stories.

NetEconomy quoted Leppan as saying: "Identifying high-risk account holders and preventing potentially dangerous accounts from being opened are critical issues for both the banking industry and the civilized world – 15 of the 19 terrorists identified in the tragic September attacks in the US were in the World-Check database."

The Dutch-based firm, which offers "anti-money laundering and fraud detection" solutions, could not substantiate the claim when challenged by OffshoreAlert and said it would withdraw a press release from its web-site, although it is still there three months later.

Leppan made a similar comment in an email to us in February, writing: "I can also confirm that we did have 15 of the 19 WTC (World Trade Center) in the database prior to the Sept. 11 attacks. Naturally, as indicated to all, these entities were not identified as potential hijackers."

Leppan later appeared to backtrack, stating that these "15" of "19" were not the hijackers, as had been reported by journalists, but people he said had been identified by U. S. authorities as "planning" the September 11 attacks, even though this list appears to exist only in his imagination.

"I am proud of my dedicated team of researchers and the work they put into identifying these 15 individuals in advance," he wrote.

Leppan said that this purported list of 19 people who had "envisioned, planned and funded this horrific act" had been released "shortly after the 9/11 attack" by "President Bush and the U. S. State Department".

"The original list consisted of 19 names," he said, stating that it was later revised to 22 and reiterating that "Fifteen of those 19 names were in the World-Check database prior to the attack".

However, the U. S. State Department told OffshoreAlert there was no such list of September 11 planners and the only list that contained 19 names was that of the actual hijackers.

The State Department did, however, release a list of 22 "Most Wanted Terrorists" on October 10, 2001. The list and accompanying press release does not directly link them to September 11 and states they are wanted for other attacks committed from 1985 to 1998 for which they were previously criminally indicted.

It was this list that Leppan sent OffshoreAlert in a Microsoft Excel chart that he named "Table of Terror" and which he said detailed "the names, sources and entry dates of the 15 that were in the World-Check database prior to the attack".

His own chart did not back up what he was claiming, however. The "Date Entered" part of the chart claimed that 13, not 15, were in World-Check before September 11, while OffshoreAlert could find only 12 when we searched its database.

In its own profiles of the 12, World-Check's database does not link any of them to September 11, as the firm's promotional material does, except Osama bin Laden, whom the U. S. believes masterminded the attacks.

Reports that World-Check had 15 of the September 11 terrorists in its database before the incident first started appearing in news publications at the beginning of the year.

In January, British-based Euromoney magazine reported Leppan as claiming that "of the 22 terrorists involved in the attack, 15 were already on the World-Check database".

A month later, the Associated Press interviewed Leppan and reported: "The 19 terrorist hijackers of Sept. 11 were a virtual blank spot to U.S. intelligence agencies, but a British banking compliance company had profiles on 15 of them in its files of high-risk people.

"Banking clients had access to the information, but the profiles evidently were never seen by U.S. agencies that might have spotted something in them to act on."

Other reports, which appear to be based on the AP story that Leppan says misquoted him, were published in Insight on the News, Computer World, Business a.m., St. John's Telegram and Windsor Star.

OffshoreAlert has found other apparent discrepancies between what is being claimed about World-Check in news articles and in promotional material and what our research has found.

World-Check states that "24 hours a day a specialized team of multilingual editors in 5 different countries research and monitor each entity".

But there are several examples of its data being out of date, sometimes as soon as it is entered, despite the existence of publicly-available articles about the entries World-Check states it is monitoring.

Sir Lynden Pindling had been dead for 16 months when World-Check entered him into its system on December 24, 2001 as Prime Minister of the Bahamas – a position he had not held since 1992.

Former Bermuda Premier Pamela Gordon was still listed in World-Check as leader of the United Bermuda Party on July 25, 2002 even though Grant Gibbons took over the role nine months earlier.

An entry for Bermuda-based insurance broker Stirling Cooke Brown Holdings, incorrectly spelt "Sterling" by World-Check, stated: "Allegations of fraud against the company in the late 1990s, but the company won the court battle."

However, Stirling Cooke is currently a defendant in a major fraud lawsuit that turned into the longest civil trial in the UK this year, starting in January and only recently finishing, with a judgment expected in the first quarter of 2003 which may cause the firm to go bust should it lose.

This case has been widely reported in international insurance publications and details are available free of charge to anyone who types 'Stirling Cooke fraud' into an Internet search engine at www.google.com.

A World-Check entry for Rudolph Linschoten created on December 8, 2001 stated that: "Operates - IIP - from home in Orange County - SEC 1998 - SEC – fraud." Linschoten could not have been operating IIP (Investors International Publishing) from home on that date, however, since he was in prison for fraud after being sentenced to five years on September 13, 1999 – more than two years before he was entered in World-Check. This information can also be found by typing 'Rudolph Linschoten fraud' into Google.

A World-Check promotional brochure states that its database "contains detailed information on extreme and high risk individuals and entities" but several people who have been entered do not seem to pose an unusual risk to financial institutions.

In the Cayman Islands, local residents have been entered in World-Check apparently only because they are a member of the local Chamber of Commerce, including William S. Walker, a well-known attorney; Colin Whitelock, Richard Parchment, Nicholas Duggan, Gilles Langlois, David Bird and Lynn Whittaker.

Melba Nixon and Florence Goring-Nozza are among those included apparently only because they contested the 2000 Cayman General Election, at which they were not elected.

Apart from claims about the September 11 terrorist attacks, other information attributed to Leppan in news articles about World-Check conflicted with the results of OffshoreAlert's research.

After interviewing Leppan, a German magazine reported that World-Check had earned revenues of $1 million in its first year but its financial return filed with Companies House for England & Wales showed that the total turnover for its first 17 months in business was less than one-third of this figure, i.e. GBP199,407 (approximately US$313,000), contributing to a net loss of £89,376 ($138,549). When asked about this by OffshoreAlert, Leppan attributed the difference to World-Check being a subscription-based business that recognized its revenue monthly, rather than annually.

On February 6, 2002, Finance Asia magazine quoted Leppan as saying that World-Check was "fortunate" not to have "yet lost a single client" due to non-renewal even though, at the time he was interviewed, his firm had been accepting clients for less than 12 months and had not gone through its first renewal period.

Leppan told OffshoreAlert: "Some clients renewed early, while others superceded their existing contracts to upgrade their service. To date, we have lost only one client and that was because they ceased to exist."

Leppan implied that OffshoreAlert's publisher, David Marchant, was trying to harm World-Check because Marchant was involved with a rival due diligence database provider, WorldCompliance.

"The facts surrounding your motivations in writing this story and your ulterior financial interests must be divulged as a matter of legality and journalistic integrity," he wrote.

Referring to the fact that OffshoreAlert has approached him twice about the subject, first in February and again in August, he commented: "Your insistence on the matter shows that your intent is not to verify or report facts or even to correct the misquote but rather to deliberately damage our excellent reputation for your own financial gain.

"Out of journalistic integrity I hope you inform your readers that you have recently launched a competitive company to World-Check.

"In fact, one could make a solid argument that your company, 'World Compliance', has unethically and illegally obtained private and confidential information belonging to World-Check to develop your competitive product. Mimicry is the ultimate form of flattery, but at times it may also be illegal."

Leppan added: "Mr. Marchant, I imagine you have left in your wake an endless number of individuals and businesses claiming libel against you.

"'Libel' is a big word used to describe bad, unsubstantiated journalism.

"Let me make myself perfectly clear that what you are proposing to write goes well beyond libel – it instead carries both civil and criminal implications.

"To abuse the authority and responsibility you have been given as a journalist, in a cloaked attempt to smear your competition, is absolutely shameful.

"My first inclination was to ignore this request for information. You do not deserve it.

"Upon further consideration, I thought it was my responsibility to address your baseless claims, and more importantly, expose this unprofessional charade of yours.

"Again, I can only hope you reprint my response in its entirety out of respect for both your readers and the journalistic profession you are defacing.

"I will also bring formal complaints against you in front of the district attorney's office and any and all journalistic authorities.

"I strongly suggest you re-examine your tactics and consider spending your efforts trying to build your business just like the rest of us – one ethical brick at a time."

Some of the questions submitted to Leppan by OffshoreAlert, together with his answers, received by us on August 27, 2002, are contained below.

OA: In an article written by Geraldine Friedrich, which was published in a German magazine and can be viewed on the Internet at http://www.brandeins.de/magazin/archiv/2002/ausgabe_04/was_wirtschaft_treibt/artikel4.html, it is reported that you claim World-Check brought in $1 million of revenue in its first year of operation and that you expected to bring in approximately $2 to $3 million in the second. However, the accounts for Global Objectives Ltd. filed with Companies House for England & Wales show that, in its first 17 months in business ended March 31, 2002, gross revenue was GBP199,407 (approximately US$313,000), i.e. less than one-third of what your claimed figure. How do you explain this discrepancy?

DL: As a subscription-based service, World-Check's client contracts extend for a year but revenue is only recognized on a monthly basis according to standard subscription accounting practices.

OA: In an interview with Finance Asia magazine that was published on February 6, 2002, you claimed, inter alia, that: "We have a minimum of 100 names for every country." However, of the 236 countries in World-Check's database, 121 - or 51 per cent of the total - have less than 100 entries. How do you explain this discrepancy?

DL: The interview reflected in the above magazine was just excerpts from a much more detailed conversation. In actuality I said that World-Check had at the time at least 100 names on average for each country, with many of the countries being quite small. I went on to state that we anticipate reaching on average 1,000 profiles per country. This statement was also cut back to fit the publication's format. Please note that this interview correctly quoted me on the matter of the 9/11.

It is certainly worth noting for your readers that you have gained unauthorized, and therefore illegal, access to World-Check. We insist that you cease and desist this pirating. Once again, it is shameful that you justify illegally accessing our database under the guise of journalism when you know – and your readers know – your true intentions.

World-Check's ultimate value proposition actually has nothing to do with the size of our database but rather with what we do with this data.

OA: In that same article, you stated that: "I was involved in banking compliance for five years in Switzerland, Liechtenstein and Luxembourg." In what capacity were you "involved in banking compliance", e.g. was it sales, marketing, account screening, etc.? Who did you work for, e.g. was it a bank or another type of company, what are the names of the employer(s) and what was your position(s)? What is your professional background/qualifications that is pertinent to providing due diligence services?

DL: I was a Director of Business Development for a very large US company that provided financial institutions with compliance solutions.

OA: In that same article, you claimed to have "60 banking institutions in 16 countries" as clients, adding that "that doesn't mention the agreements we have with regulators". Given that World-Check's minimum product pricing is $7,000 per year, 60 banking clients at the minimum price of $7,000 each - which does not take into account possible regulator clients - would equate to annual gross revenue of $420,000, which is $107,000 more than the entire gross revenue of Global Objectives for the 17 months ended March 31, 2002, as reported to Companies House. How do you explain this discrepancy?

DL: I explained our accounting practices above. We now actually have over 110 institutions using our service from around the world. Our pricing is well known – in fact you have modeled yours after ours as I am sure you are aware. Our agreements with our clients and what they pay for World-Check is of course confidential.

OA: In that same article, in answer to a question of "What has the feedback been like since you started?", you replied: "The crunch time always comes with renewal. We have been very fortunate and have not yet lost a single client." Given that World-Check obtained its first clients in April, 2001 (which you also stated in the interview), that clients sign up for annual membership and that the article was published ten months later, i.e. before your first renewal season, how can you justify your answer to the question?

DL: Some clients renewed early, while others superceded their existing contracts to upgrade their service. To date, we have lost only one client and that was because they ceased to exist.

OA: In one of the articles about World-Check, it is stated that your father is a politician in South Africa. What is his name and is he included in the World-Check database?

DL: My father retired from politics 10 years ago, furthermore, he was never a high political office holder, but was rather a local councillor which would not qualify for inclusion in World-Check's database.