AHAB v SICL & Others: The Cauldron of Fraud

On 31 May 2018, the Chief Justice of the Grand Court of the Cayman Islands handed down judgment in Ahmad Hamad Algosaibi & Brothers Company v Saad Investments Company Limited and Others. At their height, the claims and counterclaims amounted to over US$17 billion.

The Defendants to AHAB’s claims were 16 corporate entities, all of which are in official liquidation, and one individual, Maan Al Sanea (“Al Sanea”). Al Sanea did not participate in the proceedings save for an unsuccessful forum challenge. AHAB alleged that its claims gave rise to a proprietary interest in all of the assets held in the estates of the corporate entities, thereby impeding the distribution of the assets of these companies to their creditors by the official liquidators.

After a year-long trial the Chief Justice found that far from being the victim of fraud Ahmad Hamad Algosaibi & Brothers Company (“AHAB”) had been actively involved in an enormous and longstanding Ponzi scheme which had defrauded more than one hundred banks. In determining AHAB’s claim, the Honourable Chief Justice considered inter alia what the AHAB partners knew of the fraud on the banks, the benefits they received as a result of it, AHAB’s allegations of forgery and manipulation of documents, tracing, and the defence of illegality. On 14 June 2018, AHAB filed a notice of appeal, appealing the decision of the Grand Court to the Cayman Islands Court of Appeal.

 

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