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The most significant fraud trial ever to be heard in the Cayman Islands.
After a trial lasting a little over a year, the Chief Justice of the Grand Court of the Cayman Islands has handed down judgment in the case of AHAB v SICL & Others; the most significant fraud trial, both in terms of value and length, ever to be heard in the Cayman Islands. The Chief Justice dismissed AHAB's claims and dismissed the counterclaims brought by two of the nine GT Defendants.
The Chief Justice found that certain businesses of the Ahmad Hamad Algosaibi Brothers partnership (or AHAB, the plaintiff in the proceeding), including the Money Exchange (an unincorporated division of AHAB), were used to perpetrate an enormous and long-standing Ponzi scheme ("one of the largest...in history") which defrauded more than a hundred banks. From near the time of the establishment of the Money Exchange until its collapse in May 2009, financial statements disseminated to the lenders to AHAB deliberately and grossly understated the extent of the borrowings and so the true extent of the AHAB indebtedness to the banks and its status as a borrower. By presenting them to the banks, the false financial statements became the central instrumentality of the fraud. Every single dollar or riyal that ever flowed into the Money Exchange was obtained dishonestly through fraudulently obtained borrowing. It was, from inception, a criminal enterprise and remained so throughout its existence. AHAB has filed a Notice of Appeal.
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