Community news and investigative journalism for Wapping E1W and Tower Hamlets London

Tower Hamlets ex-Mayor faces financial ruin as noose tightens

By on July 7, 2015 in Investigations, News

Update 17:38 hrs Tuesday 7 July 2015

At this morning’s hearing Rahman was ordered to disclose all his income and expenditure for the last five years, his tax returns for the last seven years (and to use his best endeavours to obtain earlier returns) and all the funders of his legal costs in the election petition and in the freezing injunction proceedings.

There will be another hearing this Friday, to determine whether Rahman can have access to any of the £88,000 held by K&L Gates, Rahman’s solicitors in the election petition and then a further hearing to determine the freezing injunction finally on 3rd August.

Now read on for the background story….

Financial assets worth £350,000 of the former mayor of Tower Hamlets Lutfur Rahman have been frozen and he is now restricted to £500 a week pocket money following a court injunction. Another court hearing is scheduled for today.

Details of the various properties that Rahman owns are beginning to emerge in addition to his involvement with Bangla Town Business Complex Ltd.

The reason for the freezing of Rahman’s bank accounts is the fear that he will attempt to ‘dissipate or conceal’ his financial assets and property in an attempt to avoid paying costs awarded against him.

A continuing battle to recover costs of the original trial from Rahman is now underway with the four electoral petitioners faced with the surreal situation that they cannot recover the costs of recovering the original costs.

To date this extra amount is in excess of £20,000 and rising as Rahman attempts to avoid the consequences of his actions.

The ex-Mayors wife, Alesha Khatun Farid, is now claiming that she has a beneficial interest in two buy to let properties that the Mayor had previously stated in court were solely owned by him.

Andy Erlam

Andy Erlam

“”Mr.Rahman is very wealthy. He said he believed in British justice. So why does he refuse to pay his due when a High Court judge orders it?.” said Andy Erlam, one of the four petitioners who challenged the legality of the 2014 election in the High Court and won. “He tried to bankrupt and intimidate us. Now we have to spend thousands more pursuing his ignoring the highest court in the land.”

In April 2015 Rahman, Britain’s first elected Muslim mayor, was found guilty of corruption and illegal practices at the end of a legal challenge to the validity of the May 2014 Tower Hamlets Mayoral election brought by four ordinary residents under the provisions of the Representation Of The People Act.

Rahman was barred from office for five years, the result of the election declared void and a re-run ordered. This took place in June and was won by Labour candidate John Biggs.

In addition to being barred from office an interim award of £250,000 towards the electoral petitioners costs was made against Rahman. Total case costs are now estimated at £1.5m, with the petitioners costs being £490,000.

To date Mr. Rahman has paid nothing to the Court.

My husband looked after the money

Mr. Rahman’s main residence is given as 160 Old Montague Street London E1 5NA which is owned by his father.

As a member of a local authority Rahman stated in his Notification of Personal Interests that he had beneficial interests in two properties, 30 Deal Street London E1 5AH and 3 Grace Street London E3 3DJ.

During the election trial Rahman confirmed that he owned both these properties. It is estimated that the sale of these properties would provide Mr Rahman with sufficient funds to pay the petitioners costs.

The trial also heard that Rahman’s wife, Alesha Khatun Farid, owned another property in Grace Street, number 5.

In the last few weeks, as it has become increasingly apparent that Rahman will be forced to sell both 30 Deal Street and 3 Grace Street to pay the electoral petitioners costs, his wife has now claimed that she has an ‘absolute interest’ in 30 Deal Street and a 74% interest in 3 Grace Street, so making it more difficult for these properties to be sold.

Court correspondence shows that Mrs. Rahman’s reason for this late disclosure is that ‘I am an Asian woman and come from a culture where the husband takes charge of financial and property affairs’ and consequently the properties were registered in Lutfur Rahman’s name alone.

It seems that having realised the potential drawbacks to her previous disinterest in property matters she is now seeking to rectify this.

Unless Mr. Rahman has been living at 160 Old Montague Street rent free for the last ten years while a partner in a solicitors’ firm and a paid executive mayor, his fathers residence could also become the subject of legal proceedings.

Bank account? What bank account?

After being found guilty of corruption Mr. Rahman launched a public appeal for funds to help him challenge the court result. To date the amount in the Barclays bank account created for this purpose has not been disclosed.

Legal counsel for the petitioners state that there has been no disclosure of the monies held in the Barclay’s bank account set up to hold funds raised by Mr Rahman and his supporters in order to challenge the electoral court judgment, despite the fact that this received attention in the national press and broadcast media.

The response to this by legal counsel for Rahman?

“As far as Mr Rahman is aware no such bank account has been set up and nor have any such funds materialised.”

Youwhatwhere?

Seems Evening Standard reporter Robin de Peyer was hallucinating when he wrote this article  Ex-Tower Hamlets Mayor Lutfur Rahman launches fundraising drive for legal challenge on 30th April and tweeted the photo below:

Form for the "Lutfur Rahman legal fund"

Form for the “Lutfur Rahman legal fund”

Just to be clear the bank account which does not exist is:

Account Name: Lutfur Rahman Legal Fun

Bank: Barclays Bank

Sort Code: 20-32-06

Account No: 83 22 45 03

(LW would be grateful if any of the 17 Tower Hamlets First councillors who were corruptly elected and still retain their positions could try paying in their life savings into this account and see what happens. Cheers.)

Bangla Town Business Complex Ltd

During the trial council for the electoral petitioners presented evidence showing that Lutfur Rahman has since 2003 held an interest in a company, Bangla Town Business Complex Ltd., also known as Bangla City Cash and Carry or Bangla City, with the intention of purchasing a lease on premises at 86 Brick Lane, London, E1 with the intention to purchase it within two years.

Ex-Mayor Rahman is not listed as a director of Bangla Town Business Complex Ltd on any documents seen to date by LW.

The registered address for Bangla Town Business Complex Ltd are the offices of UHY Hacker Young Group, Quadrant House, Floor 6, 4 Thomas More Square, E1W 1YW, just opposite where the Wapping Mole gets his mole food.

Bangla Town Business Complex Ltd registered address in Thomas More Square

Bangla Town Business Complex Ltd registered address in Thomas More Square

Accounts filed for Bangla Town Business Complex Ltd up to 31/03/2014 on the Company Check site show:

  • Cash: £3,976,729
  • Net Worth: £2,958,271
  • Assets: £3,985,049
  • Liabilities: £1,027,778

However the Open Corporates record shows the status for Bangla Town Business Complex Ltd as being in liquidation.

(LW will dig a little deeper on this when he can afford to buy some new burrowing equipment. So don’t hold your breath.) 

Rahman not a sleeping partner

In a court statement Helal Rahman declared that in June 2003 he and the other five partners in Bangla City – Helal Uddin Abbas, Lutfur Rahman, Mohammed Abdul Salique and Mahmud Hassan – each invested between £70,000 and £120,000. Personal cheques paid by Lutfur Rahman totalling £9,000 were also submitted to the court.

Cross-examined on Day 15 of the electoral petition trial Lutfur Rahman denied being a sleeping partner in Bangla City, stated that the personal cheques were loans and denied ever seeing the Partnership Agreement for Bangla City despite the fact that it was drawn up by Geoffrey Maxwell of Geoffrey Maxwell Solicitors – Lutfur Rahman’s former boss.

According to Helal Rahman the company was wound up in 2014 and all the business partners, with the exception of Lutfur Rahman, have received any monies due to them. It is believed that Lutfur Rahman’s money is deposited with Rafique Miah.

Lutfur Rahman has failed to disclose to the court the exact nature of this business partnership, especially with regard to the beneficial ownership of shares held by Helal Rahman.

Help the election petitioners

As can be seen the four electoral petitioners are still paying to bring Rahman and his agents to justice.

The entire borough of Tower Hamlets, every individual, every business, every voluntary organisation, has benefitted from the selfless actions of the petitioners and it seems only fair that we should all pay.

Please click on the link below and donate as much as you can. After all the Government isn’t paying a penny towards the cost of restoring democracy to Tower Hamlets.
donate-election-petitioners-button

 

 

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There Are 5 Brilliant Comments

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  1. Osric says:

    Have you thought about applying for a grant from the local authority? I know in the past local authority grants were a bit dodgy but they shouldn’t be. If fairly distributed they are something good and I think there is a very strong case for LW getting some funding to continue its demonstrably essential work in defending democracy in this borough – check it out

    http://www.open4community.info/towerhamlets1/o4schemes.aspx?WCI=htmSchemeResults&WCU=Local%3dY

    • Mark Baynes says:

      Thanks for the link but I am not convinced it would be appropriate for LW to apply for grant funding from Tower Hamlets. There are various other options but they all involved work in getting them and to be honest I am worn out and feel my time would be better spent getting a proper job.

  2. Osric says:

    Excellent journalism Mark. You are putting the mainstream papers to absolute shame. Well done and keep it up – the people of this borough depend on people like you.

    • Mark Baynes says:

      Thanks very much, that’s very kind of you to say so. Unfortunately unless I find a way to cover the costs of the site and earn a living from it I am not sure how much longer I can continue with LW. Will do my best but think I might have done enough now.

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