Citibank tipped Kevin to inherit the empire

The Maxwell Trial; Day 55

JOHN WILLCOCK

Financial Correspondent

Kevin Maxwell was seen by Citibank as a better manager than his "perhaps disruptive" father and the bank regarded him, rather than his older brother, Ian, as the heir to the empire, said Graham Bell, a former vice president of thebank. He also described how Citibank had its fingers burned after deciding it wanted nothing more to do with the Maxwell group.

Six months later, in September 1991, Kevin telephoned him and asked the bank to carry out a foreign exchange transaction. In spite of the bank's decision the deal was put through and Kevin asked to meet him.

Mr Bell had the impression he wanted to explore further borrowing opportunities and the possibility of restructuring the Maxwell group's affairs.

On 18 October 1991 the bank agreed to carry out another transaction. The Maxwell group had sold Scitex shares in America and wanted to convert $40m (pounds 26m) into sterling. Mr Bell said Citibank paid about pounds 23m to the Maxwell group but the dollars for the deal were never paid in America.

It was not until 24 October that Citibank realised its mistake. Mr Bell said he immediately contacted Kevin who expressed complete surprise. Kevin apologised and although he said it would be easy to remedy things he seemed to be vague about where the money was coming from. Kevin finally told Citibank on 28 October 1991 that Lehman Brothers had taken the cash that should have settled the deal.

Kevin pleads not guilty to conspiring with his father to defraud the pension fund by misuse of pounds 100m worth of its investment in Scitex shares. He, his brother Ian and a former Maxwell aide, Larry Trachtenberg all deny conspiracy to defraud charges relating to the misuse of Teva shares belonging to the pension funds. The case continues today.

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