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Index to British press articles on the Fayeds' purchase of Harrods

In this brilliant article The Observer's Lorana Sullivan and Melvyn Marckus give a detailed account of the Byzantine cash transactions during August and September 1984, which saw hundreds of millions of dollars transferred from the Sultan of Brunei's accounts to those controlled by Mohamed Al Fayed. 
    The fact that these transfers preceded Trade Minister Norman Tebbit's decision of 30 October 1984 to extend by 90 days the embargo preventing Lonrho from acquiring House of Fraser suggests strongly that Fayed had prior knowledge that Tebbit would make such a decision.
    
Note: It was this decision by Tebbit to extend the Government's long-standing embargo on Lonrho making its own bid for House of Fraser that finally persuaded Tiny Rowland that the only way the government would end its restrictions would be for Lonrho to dispose of its prized 29.99 per cent HoF stake. 
    Rowland subsequently entered into an arrangement with Fayed, whereby the Egyptian promised to sell Rowland his shares back once the government block on Lonrho had been lifted.   
    In fact Fayed had no such intention.  Rowland had been the victim of a sophisticated 'sting' enacted by Fayed, seemingly with the government's complicity. (For more information read the introduction to Section Six of this website and Tiny Rowland's account in article No. 41 entitled: The Harrods Scandal, published 14 August 1988).

The Observer 
Sunday, 11 August 1985

FURTHER new information concerning dealings between the Sultan of Brunei and Mohamed Al-Fayed prior to the Al-Fayed brothers' take-over of House of Fraser has been provided to the Government. 
    The information comes in a letter sent by Sir Edward du Cann MP, the chairman of Lonrho, owners of The Observer, to the Trade Secretary, Norman Tebbit, on 1 August.  The letter details five cash transfers totalling $300 million made from bank accounts connected with the Sultan to a Swiss bank associated with the Al-Fayeds in August and September last year, two months prior to the Al-Fayeds' purchase of Lonrho's 29.9 per cent interest in the Harrods stores group for £138 million.
    It also claims that $284 million was then instructed to be transferred to Kleinwort Benson in London for the benefit of Alfayed Investment & Trust SA, the Liechtenstein company whose U.K. subsidiary ultimately made the take-over bid for HoF.
    These detailed allegations were made, though not publicly, before recent statements responding to The Observer's earlier disclosure of the first transfer of $127 million from a Swiss account of the Sultan to the Swiss bank, Compagnie de Gestion et de Banque Gonet.  One statement was made in unusual circumstances by the Sultan himself.  Others came in letters sent by the Al-Fayed's lawyers to both The Observer and its four independent directors.
    The lawyers refer to what they claim is the 'unqualified assertion' made by Lonrho chief executive 'Tiny' Rowland to the Al-Fayeds' merchant bankers, Kleinwort Benson, that 'several hundred millions of dollars' were transferred from the Sultan's bank accounts' through accounts of Al-Fayed companies on to Kleinwort.'     The du Cann letter goes into detailed information Rowland relied on in making this assertion.  The letter says:
    'On 27th August 1984 Mohamed Al Fayed wrote on his own headed paper to Credit Suisse, Zurich, instructing them to transfer US$127 million from the Sultan's account to the account of Hyde Park Investment Holding SA at Compagnie et Gestion et de Banque Gonet SA in Geneva.  Hyde Park Investment Holding SA is an Al-Fayed company in Liechtenstein which opened an account at Compagnie de Gestion et de Banque Gonet on 27th August 1984.  The transfer of US$127 million was made by Credit Suisse on 28th August 1984. 
    On 5th September 1984 a further US$38 million was transferred, on the Sultan's instructions, from accounts at Morgan Guarantee(sic)[sic] to the account of Al Fayed Investment and Trust SA at Compagnie de Bastion et de Banque Gonet SA.
    On 7^th September 1984 a further US$18 million was transferred, on the Sultan's instructions, from accounts at Citibank Corporation to the account of Al Fayed Investment and Trust SA at Compagnie de Gestion et de Banque Gonet.
    On 26th September 1984 Mohamed Al Fayed gave written instructions to Credit Suisse, Neuchatel, to transfer US$31 million from the Sultan's account to the account of Hyde Park Investment Holding SA at Compagnie de Gestion et de Banque Gonet.
    At the end of August 1984 Mr. Carl Hirschmann Jnr., acting on previous powers of attorney from the Sultan, transferred US$86 million of the Sultan's money to Compagnie de Gestion et de Banque Gonet. 
    On 28th September 1984, on the instructions of Mr. Martin Muller, a director of Hyde Park Investment Holding SA and Al Fayed Investment and Trust SA (AITSA), Compagnie de Gestion et de Banque Gonet transferred US$284 million from the accounts of Hyde Park Investment Holding SA and AITSA to Kleinwort Benson in London.  The US$284 million were to be held by Kleinwort Benson to the order of AITSA.
    Such sums would appear somewhat excessive either in relation to the 'legal matter' mentioned in the Sultan's statement or two new authorities disclosed by the Al-Fayed's solicitors -- dated 20 August and referring to a 'super luxury yacht.'
    The Lonhro chairman goes on to press the Trade Secretary to either refer the Al-Fayeds' acquisition of HoF to the Monopolies Commission or 'to establish a Companies Act investigation.' 
    In their letter to The Observer's independent directors -- received by other newspapers before it reached at least two of the four directors -- the Al-Fayeds' lawyers, Allen & Overy, state no funds were ever transferred to Kleinwort Benson in order either to purchase Lonrho's 29.9 per cent shareholding or to satisfy the general offer made for shares in HoF.'  Kleinwort Benson, they say, in a letter to this newspaper, have informed them that no monies were transferred from COGEBA to the bankers on 28 September. 
    These statements do not, however, help to clarify the purpose of the transfers mentioned in the du Cann letter.  Also, neither the Sultan's statement nor that from Allen & Overy refers to the role as a director of Hyde Park SA of Christopher Hanbury, the Sultan's representative here.  Hanbury is a director of the company which owns the Dorchester Hotel in London, bought by the Sultan for some $80 million last January.

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