Dubai: A property scam using Hollywood and Bollywood actresses' names, fleecing investors of over Dh9 million, is among hundreds of real estate disputes holding court in Dubai — literally.
Courtroom legal action continues to put life on hold for Emirati businessman Ahmad Al Falasi and 11 other investors, who face a judicial battle against four Indians who allegedly swindled them out of Dh9.3 million with glamorous claims involving Bollywood actress Minissha Lamba and Hollywood movie star Tara Reid in a development.
Dubai's Al Falasi said he was swayed by the legitimate-sounding lies told by the men behind the Santorini Development, a Greek-style cluster of apartments, villas and hotels on man-made Al Marjan Island off Ras Al Khaimah.
The men claimed that the two celebrities were looking to buy property on Santorini development, due to be finished this year. Today, however, the development remains nothing more than 463,321 square feet of barren desert.
However, Al Falasi's case is not unique. Thousands of other buyers, sellers and developers are wading through the legal system, attempting to pick up the pieces from the 2008 property crash.
Dubai Court reported that it dealt with 10 times more real estate cases in the year after the financial crisis hit — 1,541 in 2009 compared to 137 in 2008, or a 1,024 per cent increase. Most of 2009 cases, 75 per cent, were still on-going and were transferred to 2010.
Case statuses for 2011 were unavailable. But it's a different scene compared to 2008. Back then, at a glitzy launch party attended by the media, it was alleged that Lamba was hunting for a property on the development and "finalising something very soon'', while Reid was not far behind.
Hollywood a long way off
Hollywood was a long way from the company's back-street office in Bur Dubai. This was where Stallion Properties owner Ankur Mehta, along with partners Sosheeta Phillip Desay, Sanjay Jayantilal Mehta and Naresh Mehta, designed glossy material promoting the 560-unit development.
Suspicion set in for some investors around February last year when the building had yet to start. They learnt that the development was built on broken promises and they didn't even own the plots of land for which they were making progress payments. Questions have now been raised as to whether Stallion Properties even owned the land, with no title deed to show for it.
Al Falasi visited the back-street Stallion Properties Office to find the owner and demand answers. But Naresh Mehta did not show up, so Al Falasi and other investors made sure their next cheques failed to clear. They are now facing court cases for bounced cheques brought against them by Stallion Properties last year. Al Falasi said one Indian investor already spent three nights in jail after flying back into UAE and being arrested at the airport, while Al Falasi has been prevented from travelling overseas until the case is closed. Meanwhile, his US studies to complete a masters in film studies are on hold.
Al Falasi is optimistic his experience would never be repeated as a new service has been set up last month to avoid more cases going to court. The resolution and mediation service which was launched in January 2011 is expected to reduce litigation by 20 to 30 per cent this year. Resolutions are expected to be reached within a 30-day period and include a 50 per cent refund of the case registration fees if a resolution is found.
Parties will discuss their dispute with a mediator until a legally-binding settlement is reached.
Meanwhile, Al Falasi's courtroom battle continues. Three of the men behind Stallion Properties — Sanjay Jayantilal Mehta, Naresh Mehta and Ankur Mehta — have been convicted and sentenced to jail for three years by the RAK criminal court for seizing money from investors by trickery.
But, they have appealed and the investors have yet to be paid back the Dh9.3 million they lost, as the civil case against Stallion Properties goes on and on.
