The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A past Bahamas Association of Compliance Officers (BACO) president was yesterday said to be free to “engage in her profession” after a Florida appeals court refused to extend a non-compete injunction relating to a two-year legal battle.

Fareda Sands and her Florida-based attorney, Troy Ferguson, provided an update to BACO’s executive committee on the the courtroom fight sparked by an April 2020 lawsuit filed against her by an anti-money laundering organisation.

The former BACO president, who still sits on its executive committee and is its education chair for 2020-2022, as well as being a Bahamas Financial Services Board (BFSB) director, has been accused by the Miami-headquartered Anti- Money Laundering & Financial Crimes Institute (AMLFC) of breaching non-compete and non-disclosure agreements after she ceased involvement with it.

The Institute is alleging that her subsequent involvement with a rival, the Association of Certified Anti-Money Laundering Specialists (ACAMS), not only violated Ms Sands’ agreement not to do business with a competitor for two years after she left its employment, but also thwarted its efforts to establish a presence in The Bahamas.

In particular, the Institute claims that Ms Sands’ departure resulted in the failure of efforts to establish a partnership with the University of The Bahamas (UoB) to provide certified anti-money laundering courses via the latter. And it also resulted in ACAMS establishing a Bahamas branch of its own in mid-2019 - all allegations that the ex-BACO president “vehemently” denies.

She and Mr Ferguson wrote to BACO’s executive committee yesterday to provide their take on events after Ms Sands’ bid to overturn the injunction obtained by the Institute was decided by Florida’s third district court of appeal.

The ruling, delivered on May 4, 2022, agreed that the Institute had “satisfied all elements for a temporary injunction by demonstrating a substantial likelihood of success on the merits, irreparable harm and that an injunction would serve the public interest”. Tribune Business understands that the verdict, and its publication, had caused disquiet among BACO and its members, leading the body to request information from Ms Sands.  

However, the Florida appeals court also partially reversed the initial injunction because the Miami-Dade County Circuit Court did not allow Ms Sands to present evidence on what the amount of the injunction bond should be. And Mr Ferguson said the appeals body also declined to extend the injunction beyond its December 31, 2021, expiration.

“AMLFC sought an injunction to prevent Ms Sands from engaging in her profession for two to three years after September 14, 2021, arising from a non-disclosure and non-compete agreement between Ms Sands and AMLFC,” Mr Ferguson wrote to BACO’s executive committee.

“On September 14, 2021, the trial court issued a temporary injunction against Ms Sands through December 31, 2021, but refused to extend the injunction period beyond December 31, 2021. Ms Sands immediately appealed the trial court’s decision.

“On May 4, 2022, the appellate court issued its opinion reversing the trial court’s order that did not allow Ms Sands to present evidence on the amount of the injunction bond. While the appellate court affirmed the propriety of the injunction, the court did not agree with AMLFC and refused to extend the injunction period beyond December 31, 2021.”

Mr Ferguson sought to present the lawsuit as a personal falling-out between Ms Sands and the Institute’s chief executive, Michelle Martin, after their relationship “deteriorated within seven months and the parties went their separate ways”. Neither the Institute nor Ms Sands disclosed the reasons for this in their legal filings, but the original injunction barred the latter from using its information, soliciting its customers and vendors and competing against it anywhere in the Caribbean.

Reemberto Diaz, the Miami-Dade circuit court judge who heard the Institute’s original injunction bid, ruled: “In or around 2017, AMLFC sought to expand to The Bahamas. On November 17, 2017, Sands entered into the non-disclosure Agreement (NDA) with AMLFC, which contained several restrictive covenants, specifically, non-disclosure obligations, non-solicitation of employees/contractors, non-solicitation of customers, customer prospects or vendors, and a non- compete.....

“AMLFC presented testimony that Sands interfered with a prospective partnership with an institution in The Bahamas, which AMLFC had been working on creating, and that fell through and never materialised after Sands’ termination.

“AMLFC has also presented testimony that Sands disclosed its road map and future business plans in The Bahamas to its direct competitor, ACAMS, who in 2019 launched a Bahamas Chapter - the first in its 20 years of business - as well as ACAMS holding an inaugural Caribbean conference in Miami, which it had never done before.”

However, Ms Sands, who heads her own company, Initium Novum Enterprise, an investment and business consultancy providing advice to high net worth clients on regulation, investment and residency in The Bahamas, has refuted all these allegations.

She has also produced a letter from the ACAMS Bahamas chapter, dated August 6, 2020, affirming that she has never been involved with its set-up and management at any point. One of two signatories to the ACAMS Bahamas letter, in the capacity of co-chair, was BFSB chief executive and executive director, Tanya McCartney.