Harriet Fear Davies in successful outcome in longest and largest Cayman Islands fraud case

The Grand Court of the Cayman Islands has found in favour of the Defendants in the Cayman Islands’ longest ever trial (also one of the largest fraud trials ever litigated worldwide) – with circa US$9billion damages claimed. Harriet Fear Davies acted as junior counsel for one of the groups of Defendants.

Her clients were the liquidators of six companies known as “the AwalCos”, who formed part of the business empire of prominent Saudi businessman Maan Al Sanea. Their liquidations followed one of the biggest corporate collapses of the 2008-09 Global Financial Crisis – and the largest in Saudi Arabian financial history - that of the Ahmad Hamad Algosaibi & Brothers Company, or “AHAB”. The collapse sparked multiple claims around the world, including the Cayman Islands proceedings in which Harriet has been instructed, working closely with a team at Charles Russell Speechlys in London, headed up by Stewart Hey, since March 2015. She was instructed by HSM Chambers in Cayman, and initially led by Marcus Smith QC, latterly by Bridget Lucas QC, both of Fountain Court Chambers, with James Hart also forming part of the counsel team.

The Grand Court held that the Algosaibi family brought dishonest claims of fraud based on allegedly forged documents. It was established that members of the family had themselves engaged in highly complex financial malpractice, defrauding local and international financial institutions out of billions of dollars over a period of thirty years. The Court held that tracing claims should fail, as did those in dishonest assistance, conspiracy and unjust enrichment. The Court also held that the defence of illegality should succeed.

Harriet was admitted to the Cayman Bar for the purpose of the proceedings and was in Court in Cayman for many of the 159 days of trial, in particular during cross-examination of witnesses via video-link from Saudi Arabia. Preparation for trial had involved research and searches through the many millions of documents provided as part of discovery, held on electronic platforms. Additionally, Harriet appeared at interlocutory hearings including a successful application for additional security for costs.

Stewart Hey, partner at Charles Russell Speechlys, said:

“At a total value of $9.2billion claimed, the sums at issue during the trial made it one of the biggest ever recorded, and the case is one of the most intricate pieces of litigation that we have ever been involved in – by virtue of the technical and financial complexity; sheer volume of documents in many different formats and multiple languages; geographical span; and the number of parties and legal practitioners involved in different countries globally.”

The Hon. Anthony Smellie, Chief Justice, in dismissing the claims, held that:

“The evidence reveals that the Money Exchange … has been used to perpetrate one of the largest Ponzi Schemes in history…  The fraud was perpetrated by AHAB and Al Sanea acting in concert against the banks, to obtain borrowing which would certainly not have been provided had the banks known the true financial position of the Money Exchange…  AHAB has concealed its active role in the fraud on the lending banks since 2009.  It has refused to make a clean breast and presented a dishonest case until the conclusion.”

This case received widespread coverage including for example:

Financial Times

The Telegraph

Click here to view the executive summary.

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