7 News Belize

Puerto Azul Project, All Just A Ponzi Scheme?
posted (January 17, 2017)
The Puerto Azul project - we've been reporting on it since 2014 when pictures emerged showing Ministers Erwin Contreras, Juniour Heredia and the PM's wife Kim Barrow rubbing shoulders with Hollywood stars in Cannes, France. They were there for the launch of the Puerto Azul project, a mega luxury resort to be built on Northern 2 Caye and Sandbore Caye - within the Lighthouse Atoll, close to the Blue Hole. The project was described as having zero environmental impact by no less than its celebrity spokesperson John Travolta. Here's how he put it at the Cannes event talking about the supposed 8 star resort:...

John Travolta, Puerto Azul Ambassador
"I am represent Puerto Azul new resort, that's 100% green in its building and its sustainability and it's also going to be the first 8-star resort in history."

Kelly Preston, Puerto Azul Ambassador
"But they've also decide to do something that's unprecedented and they've develop the Tree of Dreams Foundation which they will give 20% of their net profits per year to the surrounding people in the villages."

Well, there aren't any villages close by - but the talk sounded real good, so much so that the ministers of Economic Development and Tourism - along with the PM's wife - were happy to tag along to Cannes for the ride. In June of 2014, we challenged the Tourism Minister about the message his presence sent:..

FILE: June 13, 2014
Jules Vasquez, 7News
"What has been made of your trip to Cannes and that you were there and the investors paid. How would you respond to the criticism you've been wine and dine by these investors and they bought your approval?"

Hon. Manuel Heredia Jr., Minister of Tourism
"Jules, you know me better than everybody else, this is one of the most honest politician that exist in this country I think. We went over there yes on an invitation by Puerto Azul to look at a model concept that they had."

Jules Vasquez
"Will you support it, are you sufficiently convinced having gone to Cannes?"

Hon. Manuel Heredia Jr., Minister of Tourism
"Well a model concept and what we will see in writing and so is two different things you know. The only thing that I can tell you, I don't even know if this will succeed or not, but whatever the case, the exposure the country has gotten, BTB or the government could have never paid for that exposure over there."

Jules Vasquez
"You have accepted a gift from them which was going over, I imagine they paid for you and...."

Hon. Manuel Heredia Jr., Minister of Tourism
"Well Jules, wherever even if in San Pedro, let us go to Elvi's and have dinner and have this meeting. What is wrong with that?"

Jules Vasquez
"But out to France on the riviera is not San Pedro."

Hon. Manuel Heredia Jr., Minister of Tourism
"You know very well they can do whatever they want, but at the end of the day nobody can buy me. There is not a soul that can tell me that I have been bought for any particular thing. I am a humble honest politician."

Well, indeed, we can't pay for that publicity - in fact we wouldn't want to because the whole Puerto Azul thing has blown up - turns out - it was all just a big scam, according to Italian authorities. They call it a Ponzi scheme which bilked investors out of their money.

This morning, in a major operation orchestrated by Italian police, twenty searches were conducted between Italy and Switzerland and arrest warrants were issued for 7 people - including masterminds, and self-styled project developers, Domenico Giannini - seen in those same photos from Cannes.

The Italians say the pair set up an international criminal organization with bases in Italy, Luxembourg, Switzerland, the Caribbean and London , dedicated to serious fraud, embezzlement, illegal financial and banking activities, falsification of documents and impersonation.

And the main hook in the operation was Belize's iconic Blue Hole and the idyllic, and fantastical resort nearby which they never built. Seems, it was all just a con to get investors - like Travolta and so many others - to put their money - in a scheme which was never produced any project. Now, veterans in Belize's investment ecosystem smelled a rat every early on - I mean, an 8 star resort!? Really? And we knew something was wrong when John Mills, an investor who had a lien on the property came forward in mid - 2015 saying the Puerto Azul group hadn't even paid for the island:...

FILE: April 16, 2015
John Mills, Debt Holder - Northern 2 Cayes
"Puerto Azul is not closed on the islands. They signed a contract to purchase Northern 2 Cayes in March 2013. The first payment was to be made in March 2014. They did not make that. The second payment was to be made in March 2015 and they did not make that. The issue is that they have been 2 years into this and they failed to file an environmental impact assessment. Also, in their press releases they said that the project is in an advanced stage - that they sold 63 time shares and they are going to have 300 sold by the end of the year and that they are going to have an inauguration at Christmas. All is this is interesting since they don't own the islands right now."

According to Italian news reports, over 200 private depositors and investors invested substantial amounts of money amounting to about 20 million euro. Authorities over there have since seized 18 million Euros in fraudulently gained assets. We'll keep following the story.

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