The High Court has upheld Civil Court verdicts ordering Mahandhoo Investments and Kabalifaru Investments – two companies with ties to Dhivehi Rayyithunge Party (DRP) Leader Ahmed Thasmeen Ali – to repay millions of dollars worth of loans to the Bank of Maldives Plc Ltd (BML).
DRP MP Mohamed Nashiz, brother of the DRP leader and managing director of Kabaalifaru, and MP Ali Azim, a loan guarantor, were among the appellants at the High Court.
Both MPs had signed ‘joint and several guarantee and indemnity’ agreements for the loans issued in mid-2008.
In the verdicts delivered today, the High Court ruled that there were no legal grounds to overturn the lower court verdicts.
In the first case involving Mahandhoo Investments, BML had issued a US$23.5 million demand loan, a US$103,200 bank guarantee and US$30,090 letter of credit on July 10, 2008.
After BML sued Mahandhoo for non-payment, the Civil Court ruled on October 19, 2009 that the company was not paying the loans in compliance with the agreement and authorised the bank to sell mortgaged properties – including Reethi Beach Resort – to recover the outstanding debts along with incurred interest and fines.
The court ordered the company to settle the outstanding debt in a one year period. However the verdict was appealed at the High Court and remained stalled for almost two years.
The second case meanwhile involved a US$3.3 million loan issued to Kabaalifaru Investment and the appeal of a Civil Court verdict on September 30, 2009 ordering the company to settle the debt in the next 12 months.
Meanwhile a third case involving a Civil Court verdict in December 2009 ordering luxury yachting company Sultans of the Seas – with close ties to the DRP leader – to pay over US$50 million in unpaid loans and incurred interest and fines had also been appealed at the High Court.
In a BML audit report released in January 2009, Auditor General Ibrahim Naeem warned that defaults on bank loans issued to influential political players could jeopardise the entire financial system of the country.
Over 60 per cent of the US$633 million worth of loans issued in 2008 was granted to 12 parties, the report noted.
According to the report, US$45 million was granted to Sultans of the Seas and US$36 million to Fonnadhoo Tuna Products, two loans which comprised 13 per cent of the total loans issued in 2008.
The report noted that Fonaddhoo was owned by current DRP Leader Ahmed Thasmeen Ali – running mate of former President Maumoon Abdul Gayoom in the 2008 presidential election – while the owners of Sultans of the Seas were closely associated with the minority leader.
In September 2009, Maldives Customs filed a case at Civil Court to recover US$8.5 million from Sultans of the Seas in unpaid duties and fines for allegedly defrauding customs to import two luxury yachts.
In February 2010, the court ordered the company to pay Rf110 million (US$7 million) as fines and evaded import duties.
9 thoughts on “High Court upholds lower court verdicts over unpaid Bank of Maldives loans”
The chickens are coming home to roost.
Thas was feeling pretty smug when he and his erstwhile demigod designed the judiciary as their private veto switch on all cases.
Whether the verdict was fair or unfair is moot, the old codger had his finger on the button.
This looser was going to loose. Serves him right.
And another thing, the war cries of "dollar ge agu thirikeurey!" was encouraged on the streets by the same oligarchs who stifled the only local bank with loans worth more that half our GDP.
The very people who lost out with this blatant robbery came out in support of the thieves. Our benighted citizens deserve these kleptocrats.
When Bank of Maldives became Private Limited ?
Finally, the the Justice league of Maldives must be feeling the pressure.
Thasmeen is a thief. And so is Gayoom for giving him all this public money to finance their election campaign.
Both of them should be publicly flogged.
Thasneem, Isn't it time you came out and told the world it is Actually Maumoon who gobbled all those money.
Maumoon put this country in debt, He made his running mate backrupt and DRP he put in debt and wonder what would be the fate of PPM
"Loa laari eggaves Jehifaku neh" ...
Agree with peasant.
This is ridiculous.
BML is a public limited company, and my money is in this loan. I want It to be paid this minute.
Countries in debts are due to crisis in financial sectors including banks overspending on loans. We don't want to see this country going bankrupt just because on one or tow guys.
Maumoon facilitated these loans through a BML CEO recruited by Finance Minister Qasim at the time just for this purpose. Bank of Maldives during the last year of Maumoon's rule was out of finance and was giving big rewards new account openers.
Whats wrong with we guys. We just cheer at these guys, when do this harm to our finance system.
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