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Jury Proceedings United States of America Plaintiff- Appellee v The Bank of Nova

Scotia Defendant Appellant14.

On the 4th March, 1983 Bank of Nova Scotia’s Miami branch was served a subpoena

duces tecum issued by the United States District Court for the Southern District of

Florida. The subpoena called for production of financial documents related to two

individuals and three companies who are clients of The Bahamas, Cayman Islands and

Antigua. The Miami Office duly complied with the order and sent telexes to the branches

requesting the information. Meanwhile, on 4th April, 1983 the bank filed a motion to have

the order quashed as compliance with the order would constitute a violation of the laws

of Cayman and The Bahamas as regards to client confidentiality. The court dismissed this

motion. Further, throughout May 1983 the Bank requested the Assistant United States

Attorney to show materiality and necessity for the subpoenaed documents. The U.S.

Attorney stated his willingness to assist short of showing any materiality or necessity.

Following a period of impasse on both sides, on October 26th 1983 the district court

imposed a fine of $25,000 per day until the bank complied with the initial order. Not

until 14th November 1983, after the Attorney General of The Bahamas’ intervention, was

the information released to the United States District Court. The United States Eleventh

Circuit Court of Appeals held that the District Court did not abuse its discretion in

finding the Canadian bank in civil contempt and imposing a fine of $25,000 per day until

information. The foreign government must show a credible case that there is good reason to believe tax evasion or avoidance has taken place Wall Street Journal 28th July 2000.

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