Title: Two Micronesians Convicted of Money Laundering and Conflict of Interest in Unlawful Shipping Registry Scam

Overview

Two citizens of the Federated States of Micronesia (FSM), Martin Jano and Lukner Weilbacher, were convicted of money laundering and conflict of interest respectively, in connection with an unlawful international shipping registry set up in the name of the FSM. A third defendant, Suniel Sharma, a businessman with dual citizenship in the United States and India, was also charged in the illegitimate registry’s establishment.

The Unlawful Micronesia International Ship Registry (MISR)

The FSM allows only a closed registry system for vessel registration, with qualifications limited to FSM persons or entities, shipping companies with foreign investment permits, and those with principal offices within the FSM. In contrast, the MISR was an open registry, which violated FSM regulations.

Charges Against Jano and Weilbacher

Jano, a local lawyer, and Weilbacher, the former secretary of Transport, Communications, & Infrastructure, were accused of conspiring with Sharma to collect fees for registering foreign vessels under the FSM flag through the open registry. Weilbacher, in his previous role, wrote a letter of intent authorizing the MISR’s operations, which Sharma then used to launch the scheme. The FSM was deemed ineligible to claim any of the fees since the vessels were not legally registered to fly the FSM flag.

Money Laundering

Jano was also charged with money laundering. The court found him and Sharma guilty under FSM statutes for attempting to launder proceeds of the unlawful registration of numerous vessels.

Conflict of Interest

Weilbacher faced a conflict of interest charge as he knowingly participated in the open registry scheme while his son, Renwick Weilbacher, continued to receive compensation for services and potential future work from the registry.

The Court’s Ruling

In their memorandum of decisions, the FSM Supreme Court declared:

“The Micronesia International Ship Registry was an unlawful enterprise. Sharma was able to set up and operate the Micronesia International Ship Registry and registered 103 ineligible vessels and collected registration fees from their owners because Lukner Weilbacher, then secretary of the Department of Transportation, Communications, & Infrastructure, wrote a letter of intent authorizing the registry’s operations, which Sharma used to implement the scheme.”

The proceedings are ongoing, with both defendants facing substantial fines and potential jail time.

FSM Shipping Regulations Violated

The FSM’s shipping regulations were blatantly ignored in the establishment of the MISR, causing harm to the FSM’s reputation and interests. Weilbacher, with his prior position, had a responsibility to uphold those regulations, making his actions even more deplorable. The incident highlights the importance of adhering to legal standards and ensuring transparency in government processes.