UK court freezes assets of Tannenbaum attorney
June 25, 2009
By Roy Cokayne
The worldwide assets of attorney Dean Rees, who secured financing for the Ponzi-type investment scheme of Barry Tannenbaum, have been frozen by a UK court.
This follows an application brought by Barwa Real Estate, one of Qatar's biggest developers, which is thought to have provided a $32 million (R263m) credit facility to Tannenbaum.
Tannenbaum's scheme apparently fleeced billions of rands from about 400 investors.
The order was granted by Judge Andrew Smith in the Commercial Court subdivision of the High Court in London on Monday.
It was granted without any notice being given to Rees, who has a right to apply to the court to vary or discharge the order.
Attempts to obtain comment from Rees and his attorney were unsuccessful.
Bloomberg last week reported that Barwa Real Estate said it had provided a credit facility to Tannenbaum firm Frankel Enterprises, which led to its stock losing as much as 7.8 percent on the Dubai Stock Exchange.
Barwa said it had terminated this credit facility and was taking steps to recover the amounts provided to Tannenbaum.
In terms of the order, Rees is prohibited from removing any of his assets in England and Wales up to a value of $31.3m.
He is also prohibited from disposing of, dealing with or diminishing the value of any of these assets, "whether they are in or outside England and Wales" up to the same value.
The prohibition applies to a number of specified assets, including all shares in Abated Investments, Suscito Investments, Doggered Investments, Mad Mack, Donza or other companies or organisations controlled by Rees.
Any bank account held or controlled by Rees is frozen. This applies to South African and foreign bank accounts in the name of Dean Rees, Dean G Rees or Abated Investments.
South African accounts specifically mentioned are with Investec Bank and Investec Private Bank in the names of DG Rees, Dean Rees Attorneys, Dean Rees and Associates Trust Account and Suscito Investments.
Foreign bank accounts listed are HSBC Causeway Bay Hong Kong, in the names of Abated Investments and Doggered Investments; Northern Trust International Bank in Jersey City, in the name of M3 Trustees of St Francis Trust; and accounts with Citigroup Global in New York and Lloyds in Switzerland, both possibly in the name of Dean Rees.
In terms of the order, Rees may remove, dispose of or deal in any of his assets in England and Wales provided the value of his assets still in England and Wales exceeds $31.3m. The same terms apply to assets Rees has outside England and Wales.
Rees is required to identify and surrender all his passports and/or travel documents to Barwa Real Estate's attorneys in the UK as soon as possible.
They will be kept in safe custody until Rees provides full details of all bank accounts controlled by him and details of all companies or organisations he controls or in which he has shareholdings.
Tannenbaum's Frankel Group was supposed to have agreements for raw materials for antiretrovirals (ARVs), which were meant to be supplied to pharmaceutical companies to manufacture generic ARVs. However, many of the group's purchase orders are allegedly fraudulent or fictitious.
Criminal charges have been laid in South Africa against both Tannenbaum and Rees. Tannenbaum's personal estate in South Africa has been placed in provisional sequestration.
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