November 30, 2020

The Editor Speaks: Biggest trial ever heard in the Cayman Islands gets world wide attention. Insane.

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It was like a John Grisham novel after reading the summaries provided to the media and published here on iNews Cayman on May 31 2018 (https://www.ieyenews.com/wordpress/cayman-islands-hon-chief-justices-jugement-on-the--v-sicl-and-others/). It was a landmark case and followed a 10-year dispute played out in international courts between the and Maan Al Sanea over who was to blame for the collapse of each other’s business empires.

The dispute has attracted worldwide attention as the sums involved approximately $126 billion!

Anthony Smellie QC, the Chief Justice of the Cayman Islands, in his 1,348-page judgment. dismissed the rival claims finding both to have defrauded scores of banks out of that mind boggling sum over more than two decades. He found for the liquidators of the various companies who suffered from the fraud.

The Chief Justice dismissed a $4 billion claim by AHAB against Al Sanea for alleged fraud involving an AHAB business unit called the . Chief Justice Smellie found that AHAB knew of and authorised the fraud carried out by Al Sanea.

“Ahab has concealed its active role in the fraud on the lending banks since 2009,” the Chief Justice said. “It has refused to make a clean breast and presented a dishonest case until the conclusion.”

He also dismissed a $5.9 billion counterclaim by Saad.

The following has been taken from the Judgement Summaries.

Sanea was appointed the Money Exchange’s managing director in 1981 after marrying into the Al Gosaibi family in 1980,

Between 1981 and 2009, when the Money Exchange collapsed, its financial statements “deliberately and grossly understated” the extent of its borrowings and the extent of AHAB’s indebtedness to its banks.

The Money Exchange, in conjunction with other family-owned financial businesses, were used to perpetrate “one of the largest Ponzi schemes in history”.

The Al Gosaibis allowed Al Sanea to use the Money Exchange for “massive personal borrowing” as it was the “quid pro quo for his willingness to use the Money Exchange to procure fraudulent borrowing on behalf of the AHAB partners themselves”.

Before its collapse, the Money Exchange raised approx. $126 billion by way of fraudulent borrowing from at least 118 banks around the world and AHAB was complicit in the fraud with Al Sanea.

The decision also raises serious concerns as to the integrity of the business practices of the Al Gosaibi family – one of Saudi Arabia’s wealthiest families – in the period from 1980 onwards during which together with Mr Al Sanea they have been found to have been complicit in a $330 billion Ponzi scheme defrauding international lending banks.

“The main focus of our strategy has been to get the balance of monies back to the estate as swiftly as possible,” said Stewart Hey, a partner with Charles Russell Speechlys, which acted for the joint official liquidators of six subsidiaries of Saad Group’s Awal Bank, based in Bahrain. It was put into administration by Bahrain’s central bank in 2009.

The balance from hundreds of millions of dollars could now be freed up from the estates of the liquidated companies and ultimately be returned to creditors, the law firm said.

Ahab said it was disappointed with the result, but added that it had the right to appeal.

An appeal?

That may take a long time and is there any money left in the coffers?

Will an appeal stop any monies being released?

Will the appeal, if executed, be heard in the Cayman Islands?

Will the new building be constructed before the appeal is heard?

Will John Grisham write a sequel to “The Firm” based on this case?

How rich has this case made all the lawyers involved?

Will any of the above questions be answered in a timely fashion or ever?

One question above can be answered.

“Until all appeals are concluded, the liquidators of the Saad Group estates are unlikely to be able to make any distributions to their creditors,” said Simon Charlton, chief restructuring officer for AHAB.

Ahab had previously obtained a $2.5bn default judgment in the Caymans against Mr Sanea in 2012, which Judge Smellie said remains unaffected by the outcome of the trial. Mr Sanea has always denied any wrongdoing.

It may mean the longest trial record ever heard in the Cayman Islands set by this one could be broken by the very same people.

Insane isn’t it?

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  1. […] Source: Cayman Eye News It was like a John Grisham novel after reading the summaries provided to the media and published here on iNews Cayman on May 31 2018 (https://www.ieyenews.com/wordpress/cayman-islands-hon-chief-justices-jugement-on-the-ahab-v-sicl-and-others/). It was a landmark case and followed a 10-year dispute played out in international courts between the Al Gosaibis and Maan Al Sanea over… Link: The Editor Speaks: Biggest trial ever heard in the Cayman Islands gets world wide attention. Insane. […]