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EXCLUSIVE: GREAT ST. CROIX WINE DEBACLE: ‘Judge Judi’ Orders Sale Of Prosser’s Assets, $2.2 Million Wine Collection … Crucian Confusion Follows

CAUGHT UP IN A CHRISTIE’S CORK CAPER: Former U.S. Bankruptcy Judge Judith “Judi” Fitzgerald authorized the liquidation of Jeffrey Prosser’s company and assets to satisfy a loan that he had found alternate financing for. Fitzgerald resigned from her position as a federal judge in May of 2013 without fanfare — four years before her federal appointment was scheduled to end.

SPECIAL INVESTIGATIVE REPORT–EXCLUSIVE TO THE V.I. FREE PRESS – PART FOUR
By JOHN F. McCARTHY
V.I. Free Press Reporter

With the federally-mandated sell-off of Jeffrey Prosser’s company and personal assets by the U.S. Bankruptcy Court starting in 2007, there were plenty of opportunities for rogue actors and operations to come into play.

Despite the fact that Prosser arranged for alternate financing of $620 million for his Caribbean media empire through Silver Point Capital on June 27, 2007, U.S. Bankruptcy Court Judge Judith Fitzgerald would not allow Innovative Communications Corporation (ICC) to divest itself of the National Rural Utilities Cooperative Finance Corporation (RTFC/CFC) that held the $520 million note on ICC and its subsidiaries.

That meant the field days that began in Government House St. Thomas with John P. de Jongh, Jr., his cronies and the court-appointed trustee Stan Springel and “restructuring” company Alvarez and Marsal would now extend to a feeding frenzy on Prosser’s assets to include three international law firms and the world’s largest art auction house, hired to assess the Prosser family’s art and $2.2 million wine collection.

In March of 2008, Fitzgerald authorized Christie’s to auction off the Prosser family’s art and wine collection. Chapter 7 Bankruptcy Trustee James Carroll and Christie’s Melissa Bernstein went to the Prosser’s homes in Lake Placid, New York; West Palm Beach, Florida; and St. Croix, U.S. Virgin Islands to catalog and inventory the wines prior to sale.

Christie’s wine expert Charles Antin estimated that there were 400 bottles in Lake Placid, 992 in St. Croix and 1,658 being stored by them in a Manhattan transshipment warehouse. Christie’s Michael Moser wrote to Ronald Mostero, Christie’s wine warehouse manager on July 20, 2011 saying that United Parcel Service (UPS) could do the shipping from St. Croix for $10,000.

The fine wines in Lake Placid and West Palm Beach could be easily retrieved as they were being stored on the U.S. mainland. But the wines at Prosser’s home in St. Croix presented more of a logistical problem in terms of ensuring that the wines would be kept refrigerated during all points of the transit to the United States — and that they would be handled carefully — not damaging the corks or breaking the bottles along the way.

“We’ve done pack-ups in Puerto Rico, I’m guessing it will be the same deal,” Antin wrote to Christie’s warehouse manager Ronald Mostero on Feb. 25, 2011. “I would look into Magic Transport based in NJ. They do temp-controlled air freight from PR, I believe, and St. Croix is just next door. It’s going to be really, really expensive. but so it goes. Client is paying.”

Antin tells Chapter 7 bankruptcy trustee Carroll that on July 18, 2011 that there is about $300,000 worth of wine at Prosser’s Shoys property and that it will cost “a few thousand” to pay for customs duties and to send packaging materials, including two pallets to the island.

But having plenty of experience in auctioning off people’s prized possessions, Christie’s made an executive decision about the wines being stored in St. Croix — an expert would be sent and immediately decide that the wines are not suitable for sale — making shipment to the mainland unnecessary, court documents indicate.

“My counsel is if two or more specialists are required for such consignments, that my participation be near the top of the on-site list (high risk being the salient issue),” Christie’s rare and fine wines expert Anne-Marie Bazzani wrote to Antin on July 8, 2011. “It is easier to reject on site, than to take the property in-house and be exposed to later rejection and further insurance risk should bottles break/go missing while in our possession (’62 Ponsot for instance). As we are considering a potential warehouse move, these issues are foremost on my mind as these were major headaches (i.e. claims) we experienced when we moved from Zachy’s warehouse.”

When Christie’s Antin was taken onto Prosser’s Estate Shoys property on July 29, 2011, it was raining. Prosser’s home attendant led the two men to the storage room where all the wine was kept in a temperature-controlled room. But upon entering the room, Antin immediately said the temperature inside was too warm and that the wine inside had been “cooked,” court documents indicate.

And while Antin was still on the property talking on a cell phone with Carroll, he was instructed by the trustee to unplug the cooling system that was preserving the wines at Prosser’s home, court documents said.

Further complicating the matter, when Prosser’s home attendant found that the wine cooling system had been unplugged, he filed a police report with the Virgin Islands Police Department (VIPD).

A St. Croix police detective diligently began investigating who could have unplugged the cooling system.

Caribbean Cooling owner Dan Lawrence of Peter’s Rest, St. Croix said in a sworn affidavit that he was in charge of maintaining the units at the Prosser property and that the temperature inside the wine storage room was 70 degrees Fahrenheit or less at all times — prior to the units being unplugged.

In internal company emails obtained by the Virgin Islands Free Press, Antin admitting to unplugging the cooling units that day. But when he gave a sworn statement to the bankruptcy court and was interviewed by the VIPD, he denied doing it.

When Prosser’s attorneys tried to raise the issue of sabotage with Judge Fitzgerald in Pittsburgh, Virgin Islands Assistant Attorney General Carol Thomas-Jacobs told the bankruptcy court falsely that there was no “authorized” St. Croix police investigation into sabotage of the wine collection at the ICC CEO’s home.

According to court documents, Thomas-Jacobs was advised by then Virgin Islands Attorney General Vincent Frazier to make the false statement after he agreed on that strategy with former acting U.S. Attorney for the Virgin Islands David Nissman and Fox Rothschild partner William Stassen.

Then, back in the territory, Nissman, former Virgin Islands Police Commissioner Henry White and former Police Chief Chris Howell tried to squelch the investigation into the St. Croix sabotage altogether, court documents allege.

Prosser’s home attendant, unpaid off-duty police officer Oakland Benta, who ushered Antin and Carroll on to the property in late July 2011, was the person who filed the police report about the cooling units being turned off. Howell, with the permission of White, immediately fired Benta from the force — in an effort to complete the cover-up.

But after he was let go by the VIPD, Benta joined Prosser’s lawsuit against the people accused. Eventually, he was fully reinstated onto the St. Croix police force, including back wages and benefits for the time he was in limbo from the VIPD. The record of his firing was also expunged from his file.

Adding insult to injury, Fitzgerald’s federal bankruptcy court fined the Prossers $947,221.66 after Christie’s rejected the wine that he had stored in St. Croix. About $500,000 of the court-imposed penalty amount was for “legal fees” connected to the great Crucian wine debacle.

In 2011, the Daily Caller reported that 27 U.S. Attorneys had been assigned to investigate widepread accounting and tax fraud at the National Rural Utilities Cooperative Finance Corporation (RTFC/CFC), but that the investigation stalled when two federal prosecutors in Dallas were “compromised” with bribe money allegedly from the U.S. Virgin Islands.

Since then, the V.I. Free Press has learned that Fitzgerald, former Gov. John de Jongh, former Sen. Celestino White, former Sen. Louis Patrick Hill, former Sen. Carlton Dowe, former Sen. Roosevelt David, jailed former Sen. Alvin Williams, Chapter 7 Bankruptcy trustee Stan Springel, Vinson & Elkins partner Dan Stewart, Chapter 7 bankruptcy trustee James Carroll, Yann Geron of Fox Rothschild and Alvarez and Marsal’s Byron Smyl have all been interviewed by the U.S. Department of Justice in connection with these matters.

Fitzgerald resigned from her appointment to the U.S. Bankruptcy Court in Pittsburgh on May 31, 2013 four years before her term was due to end. She is currently a bankruptcy consultant for Tucker Arensburg Attorneys in Pennsylvania.

“Forcing Judge Fitzgerald from the bench is commendable, allowing Judge Fitzgerald’s decisions to continue to stand, and consequently, the oppression to continue for nearly four more years is not laudable,” Prosser wrote in a letter to the U.S. Department of Justice. “I and my family have not been protected from harm — and the harm persists to this day.”

The U.S. Department of Justice investigated Jeffrey Prosser three times between 2008 and 2010. It not only found no wrongdoing on his part, but said that he was the “victim” in the bankruptcy matter.

“The Department of Justice has declined to actively enter or submit a position in the Prosser bankruptcy cases due to the ongoing nature of their investigation,” Attorney Alexander Angueira said in a sworn statement. “The Department of Justice investigated Jeffrey Prosser for bank fraud due to certain referrals by the creditors, their trustees or lawyers and the Department did not find reason to continue any further investigation of Jeffrey Prosser. The Department of Justice viewed Jeffrey Prosser as a victim and important factual witness.”

Three years later, RTFC/CFC CFO Steve Lilly and RTFC/CFC General Counsel Johnathan List would lose their jobs after the Virginia-based cooperative determined that the two had spent $750 million on the quixotic adventure to divest Prosser of his highly profitable Virgin Islands-based Innovative Communications Corporation (ICC).

http://vifreepress.com/2017/05/exclusive-federal-indictments-forthcoming-based-testimony-received-jailed-former-st-thomas-sen-alvin-williams/

http://vifreepress.com/2017/05/exclusive-rise-john-de-jongh-meant-fall-jeffrey-prosser-innovative/

http://vifreepress.com/2017/05/exclusive-court-documents-identify-ungrateful-eight-participated-de-jongh-20-million-bribe-money-push-prosser-innovative/

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John McCarthy

John McCarthy

John McCarthy has been reporting on the U.S. Virgin Islands since 1989. He is originally from Detroit, Michigan.

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