Details of how detectives linked the outstanding $800,000 publicly funded loan given to Savvy Entertainment to Zane DeSilva can be revealed today by The Royal Gazette.

A court document seen by the newspaper shows that police obtained financial evidence that a $100,000 payment was made from Savvy to the personal bank account of Mr DeSilva less than a month after the company was given the government funds.

A search of Mr DeSilva’s home by police officers then uncovered a cash-analysis book showing a “ledger of payments for Savvy”. A source told the Gazette it also contained what appeared to be a log of other people the well-heeled Progressive Labour Party MP and construction boss had lent money to, containing other familiar names.

The court document quotes a senior police officer as saying the $100,000 transaction on April 27, 2018 was “suspect”, as he could find “no known legitimate business or personal relationship between MP Zane DeSilva” and Savvy or its founder and CEO Anthony Blakey and that “was compounded by the fact that MP [or later Minister] DeSilva never disclosed a personal financial relationship with Savvy or Blakey”.

Mr DeSilva, the new Minister of Municipalities and Housing, was charged in Magistrates’ Court with money laundering in connection with his financial dealings with Mr Blakey in October 2022.

Prosecutors dropped the case in August 2023, before Mr DeSilva could enter a plea for the indictable offence, after he paid $100,000 back to the public purse. He has insisted he did nothing wrong.

The source said the names listed in the red cash-analysis book, which contained handwritten notes and loose-leaf documents, showed just how intricately involved Mr DeSilva was with those at the heart of Bermuda’s Establishment.

The Southampton East MP, according to the source, had become the man to whom powerful and influential people turned when they were short of money.

“This is what Zane does,” said the source, who had knowledge of the situation and spoke on condition of anonymity. “He has positioned himself as the unofficial bank to all the strategic PLP people.”

Cindy Clarke, the Director of Public Prosecutions, told the Gazette in September 2023 that the case against Mr DeSilva did not go ahead because he signed a consent order “admitting that $100,000 he received from Blakey is recoverable property, which is an admission that the money was obtained by unlawful conduct”.

She said: “He has now repaid that money to the Government and it was no longer in the public interest to prosecute.”

Ms Clarke explained last month that the politician had possession of money that had been obtained unlawfully, adding that the “civil penalty does not assert who obtained it unlawfully; the focus is on who has possession of it”.

Mr DeSilva’s lawyer, Jerome Lynch KC, has said the order agreed to by his client “specifically envisages that he received the money innocently”.

Mr DeSilva told the Gazette in an e-mail last week: “No action was taken against me by the DPP, whose job it is to determine if they have a case or not, because they had no case against me. If they had, they would have done.”

Back in late 2017, Mr Blakey and his Bermudian business partner, Danilee Trott, were working hard to convince those holding the public purse strings to bankroll a scheme aimed at turning Dockyard’s historical Moresby House — a publicly owned property — into “Bermuda’s first A-class recording studio” to attract musicians from around the world.

Records released to the Gazette by the Cabinet Office under public access to information suggest they wrote to government ministers in November 2017 requesting a grant for the studio, promising it would operate alongside a charitable youth music side project.

Mr Blakey had a persuasive charm, according to former girlfriends and business associates of his who spoke to the Gazette.

He styled himself as a former Sony songwriter and music promoter — although the Gazette has been unable to find evidence to back up the former — and claimed he was friends with stars such as P Diddy and Usher.

Gretchen Vance, who worked as a contractor for Savvy on a short-lived watersports contest, said: “He has this aura about him, this untouchableness to him, this celebrity feeling. He walked with swagger and people fawned over him.”

A former girlfriend, who has known him since they were children in Louisville, Kentucky, and had a long-term relationship with him a decade ago, said he was adept at convincing people — including her — to part with money, but was not reliable.

“He would just make promises and they wouldn't come through,” said the woman, who asked to be anonymous and who shared evidence of numerous bank transfers she made to him.

She said he “would always say he would pay you back” but never did.

Nikki Fernandez, a musician who worked with him on a video in Nashville in 2020, claimed he didn’t fulfil his part of their agreement.

She told the Gazette: “My experience with Anthony was bad. He kept saying he wanted to be in control. I was hesitant and a red flag went up, but he is charming.”

Mr Blakey and Ms Trott managed to impress both David Burt, the Premier and Minister of Finance, and Lieutenant-Colonel David Burch, who was then the Minister of Public Works, with their studio idea and other proposals.

The records released under Pati show that on February 1, 2018, Mr Blakey billed the tourism ministry for $50,000 for “celebrity procurement” for that year’s Cup Match.

In an e-mail to Randy Rochester, then the Permanent Secretary at the Ministry of Economic Development and Tourism, he wrote: “I understand that the Premier is wanting to get this settled as soon as possible for Cup Match.”

The records don’t reveal if the invoice was paid or if Savvy brought celebrities here, but in a March 20, 2018 e-mail, Jamahl Simmons, who was then the economic development and tourism minister, told Mr Rochester: “Lot of pressure to make this a reality.”

On February 15, 2018, Colonel Burch held a press conference to announce that Savvy would create a new international entertainment hub at Cross Island, the former home of the 35th America’s Cup, and Moresby House.

At that point, Cabinet had not yet approved the payment of public funds to Savvy, and the minister made no mention of the prospect of taxpayers funding the private studio — or that the company would be allowed to use Moresby House rent-free for a period of time.

Colonel Burch, in response to recent questions, told the Gazette last month: “I didn’t think it appropriate to include something that had not yet been approved and I have no recollection of the rental terms of Moresby House.”

Behind the scenes in early 2018, the Pati disclosure shows, Savvy’s principals were pushing for cash and getting favourable feedback.

On February 23, 2018 Mr Simmons e-mailed Mr Rochester about a Cabinet memorandum concerning a grant for the studio.

The minister wrote: “Need to get this in as Premier is waiting for it with bated breath.”

On March 12, a civil servant in the Ministry of Finance e-mailed colleagues to say a Cabinet paper regarding “grant funding for Savvy Entertainment (Economic Development)” had been sent to the Premier to sign.

The public officer advised that the finance ministry “has done its due diligence”. Mr Rochester replied soon after that he was “making a few changes at the request of the Premier”.

The Cabinet Office records show that on March 27, 2018, Cabinet approved an $800,000 loan, as opposed to a grant.

The Gazette’s source alleged that normal tendering rules were able to be bypassed by presenting the payment as a loan.

A government spokeswoman said last month, in response to questions, that it was likely the grant was changed to a loan after the Premier requested “greater security and protection”.

She added: “By definition a loan is a stricter legal arrangement which provides the opportunity for additional avenues of recovery in the event of default.

“Preferring a loan to a grant enables greater prospect of recovery via legal means.”

Savvy ramped up the pressure to get the money in early 2018, claiming a deal with Sony would fall through it the funds were not transferred quickly.

According to the disclosed records, on April 3, 2018, then Accountant-General Curtis Stovell asked the tourism ministry’s comptroller for a memo “outlining the move from grant to loan” and explaining how the security requirement, requested by Cabinet in case of the loan being defaulted on, was satisfied.

The comptroller, who had advised Mr Stovell of the “urgent” need to transfer the funds, reassured him the loan agreement was “pretty comprehensive with regards to protecting the Government”. He wrote that the cost of the studio project was $1.2 million, and $400,000 was “being put up by Savvy themselves”.

The highly placed source said police discovered that, as well as requesting a loan from the Government, Mr Blakey sought money from others to pay for the studio, including Mr DeSilva and the Bermuda Credit Union.

It is not clear exactly when Mr Blakey and Mr DeSilva, chief executive of Island Construction, first met but it appears they were acquainted by January 2018 when e-mails about a sailing contest from a sports marketing agent to Colonel Burch and Mr DeSilva, then the Minister of Social Development and Sport, were copied to the Savvy CEO.

Mr DeSilva was also copied on a letter sent by Mr Simmons to Mr Blakey in December 2017.

Later that month, Mr DeSilva quit his ministerial post and did not return to Cabinet until November 2018, when he became the Minister of Tourism and Transport.

On April 4, 2018, the government loan from the tourism ministry was deposited into the bank account of Savvy Entertainment.

The court document details how Savvy’s bank account had about $10,000 in it when the $800,000 was paid in, and there were no further "sizeable deposits“ up to April 27, 2018, when $100,000 was paid out directly into Mr DeSilva’s personal bank account.

The source said that meant the money paid to the MP had to have come indirectly from public funds.

The court document quotes the senior police officer as saying that “money deposited by Savvy was not transferred into any of MP DeSilva’s business accounts, subsequent to the initial deposit”.

It is well documented that Savvy later defaulted on repayments for the $800,000 loan, although nothing about the matter was known publicly until July 2019, when The Royal Gazette first reported on it.

A further article, in September 2020, detailed how Mr Blakey had left the island with most of the loan still to be repaid.

The day after that article appeared, on September 24, 2020, Mr Rochester contacted police and a criminal investigation was launched, according to the court document.

The police inquiry led to Ms Trott being arrested on September 30, 2020, the court document states, and released without charge. It is understood police viewed her as a victim of Mr Blakey, rather than an accomplice.

Mr DeSilva was arrested on October 2, the day after the PLP won a landslide General Election victory.

The court document quotes the police officer as saying that detectives were told by Mr Rochester that Mr DeSilva personally led efforts to recover the $800,000 after returning to Cabinet in November 2018, but never disclosed his own “personal financial interest” with Mr Blakey and Savvy to anyone in government.

Mr DeSilva has stated he told the Premier and other Cabinet colleagues about his dealings with Mr Blakey.

The government spokeswoman, in response to recent questions to Mr Burt, said on February 13 that the events took place several years ago and it was “not possible nor is it reasonable” to expect the conversations which “may have taken place” to be remembered.

The Gazette understands that police believed, based on the contents of the red book and interviews with witnesses, that Mr DeSilva lent $200,000 to Mr Blakey for the studio on an unknown date via a third party.

Mr DeSilva said in an August 2023 statement that he actually lent money to a “lifelong friend”. His lawyer, Mr Lynch, said the friend in turn “loaned it to Blakey in good faith”.

The court document quotes the senior police officer as saying he “came to the conclusion … that the payment of $100,000 to MP DeSilva from Savvy was likely [suspicious...] or a form of money laundering”.

The officer added: “My suspicion was also enforced by the amount in question being a round number of $100,000 between two persons who had no known business or personal relationship.

“MP DeSilva is listed as a ‘politically exposed person’ and … the nature of this transaction was all the more suspicious by virtue of all the issues I have described …”

The officer stated that he considered offences under the Proceeds of Crime Act, the Bribery Act and the Public Treasury (Administration & Payments) Act, as well as the ministerial code, which states that a minister should not place himself in a position which “will tempt him to use his official influence to support any scheme or to advance any contract in which he has a personal interest”.

The government spokeswoman, in the February 13 statement, said: “No breach of the ministerial code has been identified to the Premier and in circumstances where breaches are noted or alleged, matters are addressed pursuant to the code.”

Before 2020 drew to a close, Mr DeSilva had sued the Bermuda Police Service for damages for alleged unlawful arrest. A key part of his civil claim was for the return of the red book.

The court document obtained by the Gazette was filed with the Supreme Court in 2021 in response to that lawsuit.

The senior policeman was quoted as saying that the red book was seized lawfully under a warrant issued by the senior magistrate, adding: “The book is germane and relevant to the investigations being undertaken, and its retention by the BPS is important to the continuing investigations.”

Police passed a file to the Department of Public Prosecutions, which opted to charge Mr DeSilva under the Proceeds of Crime Act, and he appeared in Magistrates’ Court on October 26, 2022 accused of money laundering.

He was alleged to have entered into or become concerned in an arrangement which he knew or suspected facilitated the use or control of criminal property by or on behalf of Mr Blakey, between April and August 2018.

Mr Blakey was not present but was charged, in his absence, with obtaining a money transfer by deception.

The Gazette understands that police from Bermuda travelled to Atlanta, Georgia, and spoke to him in the presence of his lawyer, who suggested he was open to returning as a witness against Mr DeSilva as part of a plea bargain.

Mr Blakey has yet to be extradited.

Mr Lynch told the Gazette, after the case against Mr DeSilva was dropped, that the “quid pro quo, if there is one, is that we have dropped significant JR [judicial review] proceedings against the BPS”.

Ms Clarke denied there was any quid pro quo, stating: “There was no consideration of that proceeding in my decision to discontinue the public prosecution of Mr DeSilva.”

Mr Lynch confirmed his client repaid $100,000 to the public purse because he wanted nothing more to do with the money, having innocently received it.

The source questioned how repaying the funds after an admission they were obtained by unlawful conduct could be considered “sufficient grounds not to proceed with a serious money-laundering charge against a politically exposed person”.

They asked: “What does that say about the reputation of Bermuda on the world stage, when you consider the precarious reputation of offshore jurisdictions?”

The source suggested Mr Blakey was unlikely to ever return to Bermuda to stand trial.

They added that they believed the Premier was enthusiastic about Savvy because of Mr Blakey’s supposed celebrity connections and the potential political capital if the studio succeeded.

“I think Burt was caught off-guard by DeSilva’s involvement,” the source said. “Burt was just starstruck.”

The Premier apologised in 2020 for overseeing the $800,000 loan.

Mr DeSilva resigned from Cabinet again in July 2020, over a Covid rules breach, and returned to the back benches, going on to win almost 89 per cent of the vote in Southampton East (Constituency 29) in the October 1 General Election, the day before his arrest.

He ran again as the PLP candidate for that constituency in the General Election on February 18 this year, winning the seat with a decisive 77 per cent of the vote.

Mr DeSilva said in an e-mail on February 11 that the police allegations were false and claimed the “DPP … refused to act” on them.

He said he would consider being interviewed fully by the Gazette about Savvy after the election, but ultimately decided against that on February 25, the day he returned to Cabinet.

A second source told the Gazette late last year that Mr Blakey was living in a Georgia suburb, with a girlfriend, a single mother, where he was depicting himself to her social circle as a successful businessman and philanthropist.

The Gazette recently e-mailed Mr Blakey to request an interview. He replied on February 7: “I have addressed the events of the past several years in detail in my upcoming memoir, which will be available later this year.

“I believe it will provide comprehensive insights into my perspective. Beyond that, I have no further comments at this time.”

Ms Clarke said last week she had not received an update from the US since the change in government. “All I can say at this point is that the extradition process continues. I therefore can't give a date for his return.”

The government spokeswoman said: “The Department of Public Prosecutions remains actively engaged in this matter. Extradition has been sought and the department is awaiting an update from the US Department of Justice.”

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