Saudi princes may face UK court over claim they laundered money for Hizbollah

LONDON // Two Saudi princes will hear this week if they are successful in extricating themselves from answering to accusations in a UK court case linking them, and companies in which they are shareholders, with money laundering for Hizbollah and smuggling gems out of Africa.
The challenge is the latest development in a case brought by Global Torch, a company linked to the two princes, in 2011 against a business partner. The Saudis, who argue the allegations made against them in a countersuit could endanger their lives and damage UK-Saudi relations, last week failed in their attempt to have the evidence heard in secret.
And, in March, a court ruled that Mishaal bin Abdulaziz Al Saud, a former Saudi defence minister, and his son, Abdulaziz bin Mishaal bin Al Saud, could not claim diplomatic immunity to avoid prosecution.
This week, a court in central London's Rolls Centre, the world's largest centre for the resolution of financial, business and property litigation, will rule on whether UK courts have jurisdiction over the counterclaims.
If the court rules against Global Torch, the trial proper will resume in January 2014.
The suit was originally brought by Global Torch Ltd, a company registered in the British Virgin Islands linked to the two princes, against an Jordanian business partner, Faisal Almhairat, whom they accused of fraud.
The two sides fell out over a joint venture in a London-registered telecommunications company, Fi Call Ltd. The Saudi princes are understood to own shares through Global Torch, while Mr Almhairat apparently owns part through a Seychelles-based firm, Apex Global Management.
Fi Call was understood to be developing a smartphone application to allow people to make free calls.
The initial litigation involved the alleged misappropriation of funds and illegal sale of US$6.7 million (Dh24.6m) worth of shares by Mr Almhairat. But it prompted Mr Almhairat to bring a counter claim in 2012.
With it came what a judge presiding over an early stage of the trial described as a "nuclear mushroom cloud" of litigation.
Mr Almhairat has brought a wide range of allegations, according to court documents obtained by two British papers, The Guardian and the Financial Times, which brought a suit to ensure that evidence would not be heard in secret.
His lawyers claim that the princes used their influence with the Saudi police to lodge a warrant with Interpol for Mr Almhairat's arrest to secure his extradition to Saudi Arabia.
They also allege that the princes were involved in smuggling precious stones out of the Democratic Republic of the Congo, paid bribes to UN officials to ensure an illicit air cargo worth $2 billion - it is not clear of what - into Nairobi, and were involved with money laundering for Hizbollah, the Lebanese Shiite movement that is designated a terrorist organisation by the US.
Prince Mishaal, 86, is a brother to King Abdullah and the head of the Allegiance Council that will eventually determine succession to the Saudi throne. Any suggestion that the prominent Saudis have been dealing with Hizbollah, which is supported by Iran, could undermine assumptions about Saudi-Iranian enmity, and put Riyadh on a collision course with Washington.
But according to transcripts of court documents obtained by the Financial Times, Prince Abdulaziz is alleged to have told Mr Almhairat that "we deal with whoever we want".
"I need to show Hizbollah that we can transfer money to them smoothly. They have potentially billions that they want to be transferred," the younger prince is alleged to have said. "We deal with whoever we want, whether it's Hizbollah, the Mafia or even the Jews."
For their part, lawyers for Global Torch have labelled Mr Almhairat a "dishonest man" who has a "history of failing to comply" with his business obligations.
None of the factual issues of the case have yet been resolved. The case is also raising questions about the British legal system's ability to maintain transparency as it tries to attract litigation cases from around the world.
okarmi@thenational.ae
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