Thursday, Jun 03, 2010

By Mirna Sleiman

Of ZAWYA DOW JONES

DUBAI (Zawya Dow Jones)--Dubai Islamic Bank PJSC (DIB.DFM), the emirate's largest Shariah-compliant lender, faces a $650 million legal battle in Bahrain with four businessmen who it accuses separately of fraud in Dubai, legal documents show.

Bahrain resident Charles Ridley and business partners Ryan Cornelius, Erin Nil and Arthur Fitzwilliam have filed a civil suit in Manama requesting a precautionary attachment order on 245.5 million Bahrain dinars ($651 million) of the Islamic bank's funds held by the Central Bank of Bahrain, according to the filing.

The Bahrain civil case comes after prosecutors in Dubai charged Ridley and his fellow plaintiffs in the Bahrain claim with alleged fraud of $501 million.

A spokesman for the partly government-owned Dubai Islamic Bank, or DIB, declined to comment on the case when called by Zawya Dow Jones.

A judge in Manama is scheduled to hear the request for an attachment on DIB's funds in Bahrain on June 14.

"We are of the firm opinion the court will pass its judgment in favor of our clients against the Dubai Islamic Bank," said Ahmed Jasim Abdulla, a Bahrain-based attorney representing Ridley and his associates against DIB, in a statement to Zawya Dow Jones.

In September 2009, DIB seized the assets of Dubai-based real estate developer Plantation Holdings, whose British owner Fitzwilliam along with Ridley and Cornelius are currently being held in Dubai for allegedly defrauding the bank of $501 million.

DIB and public prosecutors in Dubai accuse Ridley and his associates of wrongfully obtaining a loan from the bank that was secured against Plantation's assets. Ridley and the other defendants in the Dubai case deny any wrongdoing.

According to Abdulla, the BD245.5 million attachment order covers the difference between the outstanding value of DIB's loan to his clients and the value of Plantation's assets in Dubai audited by real estate consultants Jones Lang Lassale.

-By Mirna Sleiman, Dow Jones Newswires; +9714 446-1698; mirna.sleiman@dowjones.com

Copyright (c) 2010 Dow Jones & Co.

(END) Dow Jones Newswires

03-06-10 0502GMT