The US Second Circuit Court of Appeals has recently issued a contempt of court order against Doughlas Rennick, the sole Canadian owner, employee and officer of KJB Financial Corp and Account Services Corp, who stands accused of processing over $350 million for online gaming companies, for his refusal to comply with a grand jury subpoena.
In June 2009, the court served a subpoena on Account Services Corp, which Rennick sought to avoid by quoting the Fifth Amendment. His appeal was denied by a Manhattan US district judge. The panel of 3 judges said that the Fifth Amendment does not permit corporations to avail of its benefits, irrespective of the fact that the corporation is run by one man.
In August, Rennick was indicted of conspiring to commit bank fraud, launder money, and operate an illegal gambling company. He can be sentenced for 30 years on the bank fraud charge alone. When the company refused to comply with the grand jury subpoena, another US district judge issued a contempt of court order.
US prosecutors have accused Rennick of setting up bank accounts in the US to process payments from offshore online gambling companies to US residents. It has been reported that along with the help of accomplices, Rennick allegedly provided inaccurate information to the US banks about the purpose of these accounts.
The prosecutors alleged that Rennick processed more than $350 million, which was transferred from a bank account in Cyprus to his accounts in the US. The US government now seeks to gain $565.9 million, allegedly obtained from illegal gambling and bank fraud.