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Tue 1 Nov 2011 02:46 PM

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Dahdaleh must post $16m bail in Bahrain bribe case

Friends of billionaire tycoon pledge to pay court nearly £1.5m if he skips bail

Dahdaleh must post $16m bail in Bahrain bribe case
The High Court, London. (For illustration purposes only)

British
investor Victor Dahdaleh must post £10m ($16m) bail in order to be released pending
a trial on bribery charges. Several of his friends promised to pay almost £1.5m if he doesn’t return to
court.

Dahdaleh,
68, is accused of paying bribes to a Bahraini royal and the former chief
executive officer of Aluminium Bahrain (Alba) to win contracts for Alcoa. Judge
Quentin Purdy set the bail terms and transferred his case on Tuesday from a
magistrates court to a higher criminal court in London, where he will enter a
plea in January.

Friends
of Dahdaleh, including Philip Martin Cutts, the chief executive officer of Credit
Suisse Group’s UK private bank, and BP executive Thomas Prescott agreed to pay
a total of £1.4m if Dahdaleh doesn’t
return to court, according to the Serious Fraud Office, which is prosecuting
the case.

Dahdaleh
must surrender his British and Canadian passports, wear an electronic tag and
spend nights at his home in London’s Belgravia neighbourhood. He faces six
charges of making corrupt payments, two counts of money laundering, and one
charge of conspiracy to corrupt, according to court papers.

A lawyer
for Dahdaleh, Ken MacDonald, said he would fight the charges.

The
investor, who was a donor to former US President Bill Clinton’s charitable
foundation, allegedly bribed officials of the smelting company Aluminium
Bahrain, known as Alba, to win contracts for Alcoa to supply alumina, according
to the prosecutors.

Dahdaleh
paid bribes of $6m to Sheikh Isa Bin Ali al-Khalifa, the former oil minister of
Bahrain and former chairman of Alba’s board of directors, in 2003 and 2004,
according to the indictment. He is also accused of paying bribes to Bruce Hall,
the former chief executive officer of Alba, totaling around $1.75m.

Hall is
in custody in Australia and the UK is seeking his extradition, Richard Latham,
an SFO lawyer, said today.

“These
allegations are denied and will be vigorously contested,” MacDonald said in
court today. “He is not guilty of these offenses.”

A
Bahraini government official, who declined to be identified citing agency
policy, didn’t immediately comment when asked about the indictment.

Alba said last week that it had suffered "substantial
losses" from the series of transactions at the centre of the UK fraud
investigation.

The aluminium smelter said it had recovered more than $30m
to date but had still lost "very large amounts of money" through the
contracts linked to billionaire Dahdaleh.

On Oct 24, the SFO said Dahdaleh had been charged with
corruption offences and released on police bail to appear at City of
Westminster Magistrates' Court on Oct 31.

“Today marks a critical turning point in the investigation
that began nearly five years ago. The conduct of Victor Dahdaleh, Alcoa and
others resulted in substantial losses to Alba and its shareholders,” Mahmood
Al-Kooheji, Alba's chairman, said in an emailed statement.

He said the investigation revolved around an alleged bribery
scheme involving the sale price for finished aluminum sold by Alba.

“Our aim, from the start, has been to recover the very large
amounts of money that were unlawfully taken from Alba and from Bahrain by these
corrupt activities.”