Dubai Trading

Dubai Trading Agency LLC – British High Court Ruling Exposes Dark Side of Muhammad Tahir Lakhani

On October 5, 2020 the British  High Court of Justice dispensed a harsh judgment against UAE-based shipping magnate , Muhammad Tahir Lakhani and his two sons, Ali Muhammad Lakhani and Hasan Muhammad Lakhani for reneging on an a multi-million USD investment deal that Dubai Trading Agency (owned by all three Lakhani’s) with the  American private equity management firm Yield Street Management LLC.

All three of the Lakhani’s (the father Muhammad and his sons Ali and Hasan), under an umbrella of companies owned by the Dubai Trading Agency (‘DTA’), a company in the UAE formed by Muhammed in 1985, had received a series of commercial loans from Yield Street in 2018 and 2019 totaling over 74.6 Million USD.

The funds were to be utilized by DTA (and its sister companies) to purchase mothballed naval vessels at discounted rates and convert them to either scrap metal or fit for refurbishment for reselling purposes that end up being very profitable (DTA is primarily in the ‘Ship Recycling’ business).  The Lakhani’s never purchased any of the naval vessels, defaulted on the loans, and swindled Yield Street and its investors.

The High Court of Justice, Justice Jacobs presiding, ruled against the Lakhanis on summary judgment in the case and confirmed the issuance of a global asset freeze that Yieldstreet had successfully lodged against the Lakhanis’ bank accounts in the UK in a previous High Court of Justice judgment in April 2020.

Both Ali and Hasan Lakhani claimed that they were duped by their father Muhammad into signing personal guarantees (which is common in naval commercial transactions) for the $74.6 million in loans that DTA and its related companies received.  Justice Jacobs ruled in favor of Yieldstreet and lambasted both Ali and Hasan Lakhani for their claims of ignorance that they were both ‘unaware’ of their father’s actions in the case.

Jacob’s ruling stated that Ali and Hasan’s claims “..carrie[s] no degree of conviction at all. Both sons were well-educated and had taken business degree courses..” and are “well-educated individuals . . . and in whom their father had sufficient confidence to vest the entire ownership of the ship recycling business in order to accomplish family succession.”

The highly dubious business practices of Muhammad Tahir Lakhani were outlined by Justice Jacobs when he wrote in his judgment that “none of the Defendants (Tahir, Ali, and Hassan Lakhani) had served any evidence or advanced any argument disputing the facts relating to the underlying fraud on which the Claimants (Yieldstreet) relied. . . the evidence as to these frauds was, and remains, strong and undisputed.”Muhammad Tahir Lakhani and his sons Ali and Hasan able to secure this multi-million dollar loan from Yieldstreet after another US based consulting group,Four Wood Capital Partners, recommended the Lakhanis to the investment firm (that case is also in litigation in US courts).

Surprisingly, Muhammad Tahir Lakhani and his sons continue to operate brazenly and without sanction in Dubai and other international locations despite having defrauded and now owing Yieldstreet investors$74 million. As was noted by Justice Jacobs, Lakhani and his sons Ali and Hasan have a litany of shell corporations and companies located across the globe.

The companies owned by the Lakhanis include Dubai Trading Agency, North Star Maritime Holdings Ltd, and Dubai Navigation Corp. amongst others. One, Gulfstar SA,is described in Jacob’s judgment as the “commercial arm” of the group. Further research and the high court ruling have confirmed that the fraudulent activities of Muhammad Tahir Lakhaniare supported by banks, financial institutions, and companies in London, Monaco, New York, Dubai and other hubs of international commerce.

Efforts to get Muhammad Tahir Lakhaniand his sons Ali and Hasan to comment for this article were ignored by them.  Further investigations intothe fraudulent business practices of the Dubai Trading Agency discovered that the Lakhanis have built an illegal network of scamming investors under a complex web of companies that are operated from Dubai in the UAE.

Over the next few weeks, more details are expected to be released by investigators that will further unmask the illegal business deals of Muhammad Tahir Lakhani and his sons Ali and Hasan. In the meantime, some attorneys have advised investors and potential business partners of Dubai Trading Agency LLC to be aware that this company (and its other sister companies) continue to be engaged in fraudulent commercial deals.

Considering the recent British High Court ruling that confirmed the fraudulent and potential criminal nature of the Lakhani family’s dealings, continued commercial ties pose an extremely high risk for any individual or company that does any business with them in the future.

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