During this time, around 1993/4, Rölf Briese , founder and managing director of Briese Schiffahrts GmbH & Co KG, and its sister (in-house) crewing company Leda Shipping GmbH, both based in the same offices in Leer, Germany had already been experimenting with running their own crewing operation via an offshore entity in Cyprus. This avoided the high costs involved in employing crew via the German company that would involve accounting for social security deductions for the employees and charges for the employers, hence much more costly, much more admin, and any profits generated from the crewing activity would of course be taxable in GermanyFor some reason Mr Briese was not happy with the service provided by the Cyprus company and with Mr Coleridge prospecting previous UFMclients for business, it was eventually agreed to move the operation from Cyprus to Monaco.
Monaco law prohibiting the crewmembers being employed directly by an SAM (société anonyme monégasque), the Nevis IBC ‘European Shipping and Chartering Ltd’ (ESC) was incorporated to ‘employ’ the seafarers and the company would be ‘managed’ by UFM. Seafarers would be located, interviewed, and appointed by ‘vessel operators’ working for Leda Shipping (LS) in Leer who would each be responsible for the crewing of several vessels. The seafarers would be given employment contracts with the employer shown as European Shipping and Chartering Ltd, PO Box no xx, Charlestown Nevis BWI, C/O United Fleet Management SAM, Le Continental, Place des Moulins, Monaco. Apart from crewmembers and occasionally construction supervisors or superintendants no other official employees were ever engaged in the name of ESC (ie no management, finance or administration staff). ESC was simply the shell to provide offshore employment contracts for seafarers. . There would also be an opportunity to use any funds made available by the Monaco operation for payments of unofficial bonuses back to ‘home’ based employees either via cash carried directly to Germany by Mr Coleridge or via banks accounts held in Germany under Mr Coleridge’s name, once the carrying of large amounts of cash across international borders became more tightly controlled. The offshore entity would also become useful for spurious invoicing to onshore companies both within and outside of the Briese Group to reduce taxable profits and to cover cash payments made that might have otherwise attracted a fiscal or social security charge.
ESC was the only client of UFM at this time that required more than simple retransmission of payment orders (charged at USD50 a time). A full accounting package had to be set up. Sales Invoices for Crewing lumpsums had to be issued and processed in the sales ledger, invoices for crewing related costs from port agents and owner/charterers processed in the purchase ledger. Cash books kept for bank account to allocate payments and receipts, etc etc. The coding/numbering structure for the chart of accounts used was borrowed from the Briese/Leda model that had been given to the original Cypriot management company.
Eventually of course Mr Jacoumis started to suspect that the company (UFM)was indeed fairly buoyant (the Briese/Leda Business – in the form of European Shipping and Chartering Limited - had been secured and was increasing in volume) and that profits were being ‘trimmed’. He would frequently telephone wanting to speak to Mr Coleridge though his requests were usually in vain as Mr Coleridge wanted to avoid all contact..........................
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