DUBAI // By all accounts, Ian Bruce Simm is a persuasive man. He could generate sizzling excitement in property deals among investors - sometimes promising them returns of up to 40 per cent on their money. He even managed to get them to lend him bail money after he was arrested.
Unfortunately for most of them, the adage about things being too good to be true would turn out to be accurate yet again and he eventually fled the country by putting up his wife's and son's passports as collateral. He left behind 38 bounced cheques worth Dh65 million (US$18m) and this week, the biggest of those - worth Dh17m - was deemed a criminal matter by a Dubai court. Not that it will make much difference - he has already been sentenced in absentia to a total of five years in prison by three previous court judgments.
Now instead of being a Dubai success story, the tale of the Australian who arrived in Dubai five years ago at age 49 with little more than big dreams for the property market is a cautionary one being told by those who trusted him. "Dubai at the time was a hot spot for real estate and he was a very convincing person, which is what you need for this line of work," said one of Simm's former investors.
Simm began selling villas, then quickly moved to the investment side by buying property. At one time he owned 28 flats at Schon Business Park. In 2006, Simm found a local partner and registered Cougar Holding in Dubai. Under that umbrella, he set up several businesses: Cougar Real Estate, Cougar Communications, Cougar Ventures and Cougar Trading. Several websites promoted his ventures and his "larger-than-life personality", as another investor described it.
He leased an office for himself and several assistants on the 13th floor of the Fairmont Hotel in Dubai. He handed out glossy business cards and sponsored high-profile happenings. He even sponsored two competing boats in a race, both of which bore the company logo on their sails. "The Cougar brand name was getting a lot of publicity - that gave him more credibility," one of the investors said. He cashed in on that credibility by promising people up to 40 per cent returns. To prove his sincerity, he wrote them cheques dated six months after their initial pay-in.
Simm was able to deliver on that promise, at least occasionally, but as Dubai's property market declined at the end of 2008, his accounts drifted into the red. "This is when he resorted to the Ponzi scheme," one of his investors said, referring to a pyramid investment scam in which money from new investors is used to pay off early investors. "He was using new money to pay out old debt. It was the perfect pyramid scheme but it was bound to collapse," said another investor who once considered Simm a friend.
"His overheads by this point were slightly greater than his income," another investor said. But from the outside, he seemed to be living the Dubai dream. In late 2006, Simm proposed to an Australian woman with whom he had a child. The couple exchanged vows in Bali, on the shores of the Indian Ocean. In 2008, Simm travelled several times to Kuala Lumpur, where he was cultivating another start-up business.
The company, called Organisation of Islamic Countries World Trade, promised to unite Islamic trade by connecting Islamic companies worldwide in an online community for a membership fee of Dh1,519. OIC World Trade, with Simm as its executive director, boasted a prestigious address on the 40th floor of the Petronas Twin Towers in Kuala Lumpur, according to one of his business cards. "When you hand me a business card with the Twin Towers as your office, I will trust you. Anyone will trust you," an investor said.
The OIC website is still functioning and accepting credit card payments that authorities say are wired to Simm's bank account in the British Virgin Islands. In mid-2008, Simm made several business trips to Mexico where he met with investors for a separate venture he called "virtual money". The scheme promised users the ability to deposit their money into bank accounts in Mexico and use debit cards to withdraw it worldwide - without paying taxes.
When he returned to Dubai, he tried to persuade his employees to sign up for these virtual bank accounts. Authorities say he was helped in this project by Robert Everett Hodgins, an American, who is now wanted by the FBI on money laundering charges. At the end of that year, investors started cashing in their promised 40 per cent profits. The cheques bounced. On December 24, 2008, Simm was arrested and imprisoned in Dubai because of a bounced cheque he wrote to a Pakistani investor.
"From jail, he managed to convince his friends to loan him some money. He used the term 'invest'. In exchange, he would pay them back 40 per cent profits. These people were borrowing money to loan him. They believed him," one investor said, laughing. Simm was released on bail days after his arrest. Before civil court proceedings began, he paid back a portion of the money owed to the Pakistani investor.
As a guarantee he would pay back the full amount, Simm's passport was held by the Pakistani investor's lawyer until the full amount was repaid. Simm, however, persuaded the investor to give him back his passport, saying he wanted to travel to Malaysia for the launch of OIC World Trade, which he promised would be a source of "millions". The Pakistani investor agreed to return Simm's passport - but only if he left his wife's instead.
In middle of January 2009, Simm travelled to Malaysia and never returned, leaving behind his wife and one-year-old child. His wife was jobless and had no way to pay for the family's villa in Al Barsha. "She had a breakdown and was begging the Pakistani investor to return her passport. Out of compassionate grounds, he gave her back her passport five months later," an investor said. His wife left the country and is now believed to be in Australia, where Simm is also believed to be.
Since mid-2009, more than 22 investors have registered their complaints with the Dubai Police. An international warrant for his arrest has since been issued and a criminal assistance treaty, yet to be ratified, between Australia and the UAE could see Simm tried in his own country. A picture of him smiling, posing with a banner of one of his companies, is now displayed on Interpol's wanted list. @Email:firstname.lastname@example.org