Fraudster David Haigh loses English court action to avoid $6m debt recovery

'No realistic prospect of convincing court that allegations of fraud were incorrect'

An empty bench as placeholder during the first church service with believers present at the Catholic church St Ursula in Munich, Bavaria, Germany, 16 May 2020.  EPA

England’s High Court has upheld a UAE ruling that Bahrain’s GFH Financial Group can pursue its former executive and convicted fraudster, David Haigh, for $6 million (Dh22m) in damages and costs.

Mr Justice Henshaw ruled that there was no realistic prospect of a trial overturning the GFH claims against Mr Haigh and UK-based properties, including freehold and leasehold apartments and a farm.

Mr Haigh was deputy chief executive of GFH Capital, the investment banking arm of Bahrain’s GFH Financial Group, and led the group’s acquisition of a 24 per cent stake in the English football club Leeds United in 2013.

However the Dubai International Financial Centre (DIFC) Courts found Mr Haigh to be a fraudster after about 100 forged invoices arranged payment into at least four different bank accounts in Dubai, London and Manchester. He has denied the claims and tried to prevent enforcement in the UK, where he has lived since 2016.

The judgment this week stated there was “no realistic prospect of persuading this court at trial that the relevant findings in the DIFC Judgment were incorrect in any material respect.

“I agree with GFH that the substance of this case has already been considered by the DIFC Courts and resolved in GFH’s favour.”

The ruling quoted at length from the DIFC Courts’ findings, written by Justice Sir Jeremy Cooke in 2018. “Sir Jeremy Cooke found that Mr Haigh is a ‘fraudster’” who “caused to be paid into his own bank account and that of his close friend, monies belonging to the Claimant in the sums of £2,039,793.70, Dh8,735,340 and US$50,000.

“GFH was awarded damages in those amounts, together with interest, and a declaration that those amounts when received by or on behalf of Mr Haigh were held on constructive trust for GFH. Mr Haigh was further ordered to pay GFH’s costs, insofar as they had not already been determined, on the indemnity basis.”

It noted that Mr Haigh, who has a long history of campaigning against Dubai, did not take issue with the finality of the DIFC Courts ruling and had been represented by leading law firms in its proceedings.

The ruling also noted DIFC Courts had rejected Mr Haigh’s claims that the money was salary, fees and commissions. The DIFC judgment said these claims had “hallmarks of a fictitious invention of a desperate defendant seeking to find some way of challenging sums which are indisputably due from him as a result of his own fraud”.

Justice Henshaw also noted Mr Haigh’s role at Leeds United Football Club (LUFC), where he was managing director, had been examined by DIFC Courts. It said: “No credence can be given to any of the allegations made by the defendant in this regard. No evidence has been adduced to make good any claims against LUFC or the claimant for any part of the entitlement claimed and the cross claims must therefore be dismissed.”

The High Court said Mr Haigh’s claims that he had paid for services at Leeds United had been rejected by DIFC Courts. “On the contrary, as Justice Sir Jeremy Cooke said... ‘no one has ever come forward with a coherent explanation for the fact that large sums of money found their way into the bank accounts of the defendant and that false invoices were created with payment instructions, which disguised the receipt of those sums by the defendant’.”

The High Court ruling noted that Mr Haigh had served time in Dubai for misappropriating GFH funds but dismissed his claims this had interfered with his defence at DIFC Courts.

FINDINGS:

“In all the circumstances, I accept GFH’s submission that Mr Haigh’s attempt to raise these issues is:

i) (in part) contrary to the general principle that a decision by a foreign court that a judgment from the courts of that country was not obtained by fraud creates an estoppel in English proceedings to enforce that judgment;

ii) an abuse of process of the English court, since the issues were raised and disposed of in the foreign court;

iii) hopeless on the merits; and

iv) immaterial to the DIFC judgment having been obtained on the terms that it was.”