Sunland 'misled the ASX' in Dubai case

Source: Sydney Morning Herald 11 Feb 2010 (and thanks to "Anonymous" for the heads up.)
Photo: the Waterfront website
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The company at the centre of a failed purchase in a huge development has contradicted its own claims to the stock exchange.  Sunland, a Gold Coast developer behind the fraud prosecution of two Australians in Dubai, has misled the ASX three times by claiming that it and its senior executive have never been investigated in the case.
When Matt Joyce and Marcus Lee were arrested and jailed in January last year, Dubai authorities confiscated the passport of another Australian, the Sunland Group's chief operating officer in the Middle East, David Brown.
Now Sunland's own barrister has contradicted the company's repeated claims to the stock exchange, by telling the Federal Court that Sunland and Mr Brown were in fact investigated in connection with their purchase of a plot on Dubai Waterfront, a colossal development project where Mr Joyce was the managing director and Mr Lee the head of commercial operations.
Mr Brown has since become a critical witness for the prosecution against Mr Joyce and Mr Lee in Dubai. But court documents from early last year, when Mr Brown was arranging bail and fighting for the return of his passport, refer to him as "the defendant" and "the accused", and as being "under investigation".
Sunland, nevertheless, released three statements to the stock exchange - in February, March and July. The first said "there is no investigation into Sunland"; the second said no allegations had been made against the company or its executives, and that Mr Brown, while a witness, "is not the subject of investigations"; the third said Mr Brown was "never subject of the investigations nor detained".
In the Dubai fraud case - and in a separate civil action against Mr Joyce and others in Australia - Sunland alleges it was duped into paying a "consulting fee" of more than $14 million to buy the plot on Dubai Waterfront, a subsidiary of the government-owned master developer Nakheel.
Sunland paid that fee to another Australian company, Prudentia, which claimed it had established a right to purchase the plot. Dubai authorities allege Prudentia had no such right, and Mr Brown's lawyers in Dubai noted that his status was changed from "defendant" to "victim".
Mr Joyce and Mr Lee, who insist they are innocent, are trapped in Dubai with their families, having spent nine months behind bars before they were released on bail to fight the fraud allegations. Their lawyers say they have been caught up in Dubai's spectacular property market collapse, in which Sunland, like many others, lost millions.
James Packer quit the Sunland board last August and sold his $28 million stake in the group in September without explanation, although at the time he was divesting a wide range of assets.
In the Federal Court in Brisbane in December, Pat O'Shea, SC, for Sunland, said "when these matters were first investigated, Sunland was also the subject of investigation, and, indeed, Mr Brown in particular was the subject of investigation". Mr Brown's emails were seized, Mr O'Shea said. He said this background "adds force" to Sunland's attempt to vindicate its reputation.
Sunland's statements to the stock exchange raise the prospect of investors suing if they believe they bought and sold shares when the market was not properly informed.
The Herald sent detailed questions to Sunland, which responded with a two-sentence statement: "Sunland stands by its previous ASX announcements that David Brown is a witness for the prosecution and has never been implicated in any wrongdoing. Sunland has and will continue to accurately inform the ASX and its investors as is required by law."
In a follow-up letter yesterday, Sunland's lawyers, DLA Phillips Fox, repeated that neither Sunland nor any of its employees were under suspicion of any wrongdoing "at the time of the initial statement to the ASX" on February 20 last year. They were "assisting the authorities, no more".
However, a Public Prosecution document in Dubai dated February 16 last year - four days before Sunland's first statement to the ASX - says Mr Brown was informed that it was "questioning him in his capacity as Defendant in the case". On March 16, another Public Prosecution document refers to his attempt to retrieve his passport, and still Mr Brown is described as the accused.
If a misleading statement to the stock exchange is deemed to be an attempt to manipulate share prices, a prosecution can lead to a maximum penalty of a $22,000 fine and/or five years' jail for an individual and a $110,000 fine for a corporation. Lesser breaches might lead to only civil remedies, and legal sources say it would be technically possible for some false statements not to be deemed as misleading or deceptive conduct - and escape any sanction.
The Australian Securities and Investments Commission said it did not confirm or deny whether investigations were under way.
Matthew Gibbs, the corporate relations manager for the ASX, said: "Allegations about a company issuing misleading or deceptive statements are potential breaches of the law rather than ASX listing rules, and are matters for the attention of ASIC. Under ASX rules, companies are obligated to keep the market properly informed of all material events. Companies are aware of the serious consequences of failing to do so. ASX treats the market announcements made by companies in good faith, but would consider investigating their veracity if additional information was provided that suggested a breach of ASX rules."
In the Federal Court, Sunland is suing Mr Joyce, who lodged his defence last Friday, Prudentia and its director Angus Reed, who has been declared a fugitive in the Dubai fraud case. Mr Reed, back in Melbourne, and Prudentia say they acted with integrity.
Sunland is not suing Marcus Lee, the second Australian accused in Dubai. Mr Lee's lawyer, John Sneddon, has stressed that it has never been alleged that he gained, or even stood to gain, from the land deal. Mr Joyce's Australian lawyer, Martin Amad, has said his client "never received a cent" of Sunland's money.
In Dubai, meanwhile, the case drags on. The court reconvened on Sunday but was put off yet again because the first prosecution witness, a financial auditor, failed to turn up for the fourth time.

Aussies refused bail in Dubai Court hearing

The 'Gulf News' uses initials for defendants' names in their reports.
Source: Gulf News 15 Sept 09
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Waterfront's former executive director and ex-operations manager were refused bail by a court yesterday after they denied the charge of unlawfully gaining Dh44.1 million.
With his arms folded, the 43-year-old Australian former executive director, M.J., repeatedly said: "No!" four straight times when he pleaded not guilty before the Dubai Court of First Instance.
His 40-year-old compatriot ex-operations manager, M.R., said: "No!" four times in the same manner when he denied his charges at courtroom nine in front of Presiding Judge Al Saeed Mohammad Barghout.
Lawyers Salem Al Sha'ali and Ali Abdullah Al Shamsi, who are defending M.J. and M.R., respectively, told the judge that there are no more reasons to keep their clients in provisional detention.
The advocates said their clients' passports have been confiscated and asked the judge to bail the defendants.
The Public Prosecution charged M.J., M.R. and Waterfront's former legal adviser, 44-year-old Australian A.J. (who is at large), with abusing their jobs as public servants and intentionally damaging the interest of Nakheel's Waterfront project by unlawfully earning Dh44.1 million, out of which Dh22.1 million went to M.J.
According to the bill of impeachment, a fourth Australian escapee, identified as A.R., collaborated with the former Waterfront executives.
Prosecutors charged M.J., M.R. and A.J. with abusing their jobs when they managed and promoted Dubai Waterfront lands for sale and gained an illegitimate profit.
Public Prosecution records claim the Australians swindled and misappropriated Dh44.1 million from a Dubai-based property developer.
The defendants allegedly claimed to the developer's Australian manager, D.B., that one of the lands at the Waterfront project belonged to an Australia-based company, which is owned by A.R. The defendants claimed that the land had been reserved for A.R.'s company. Prosecutors claimed that the defendants deceived D.B. and lured him into paying Dh44.1 million and obtain a waiver over the ownership of the land to be able to buy it.
During yesterday's hearing, advocate Eisa Bin Haidar represented the property developer and D.B., who is claiming Dh20,000 in temporary compensation.
Al Sha'ali argued in court: "Since this case surfaced nine months ago, we submitted a document that confirms that the defendants reserved the land for the Australia-based company. Prosecutors failed to face prosecution witnesses with that document because eventually it corroborates that the suspects didn't have any criminal intention&"
Presiding Judge Barghout rejected the bail requests and adjourned the case until October 22.

More details emerge on the Sunland/Dubai Waterfront stoush.

More details on the Court documents filed by Sunland in the Federal Court of Australia (Queensland Registry) as part of their claim against Messrs Joyce and Lee. Joyce and Lee are both currently in jail in Dubai. The article also includes what seems to be the now obligatory mention of Geelong Grammar. What's with that?
Source: Sydney Morning Herald 12 August 09
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Sunland Group says two developers misled it about their friendship and the rights to a block of land, write Rick Feneley and Royce Millar.
When three Australians started haggling over a $63 million plot of land in Dubai, one says the other two kept him in the dark.
David Brown, who was leading the Dubai branch of the James Packer-backed Sunland Group, says the developers Matt Joyce and Angus Reed omitted to tell him they were friends. Nor had they mentioned that this friendship went back to their school days at Geelong Grammar.
Worse, Brown says Joyce and Reed misled him over a block of land that Sunland wanted to buy in the Dubai Waterfront development, a colossal, futuristic ''master community'', of which Joyce was general manager. Brown claims the pair led him to believe that Reed and his Melbourne-based company, Prudentia Investments, had rights over this block, the prosaically named Plot D17.
Prudentia had no such rights, a Dubai authority would tell Brown later. Prudentia did not own the plot; nor had it clinched any option to buy it. So it had nothing to sell, Sunland alleges.
Instead, Brown was told, he should have negotiated directly with the land's owner, Nakheel, the government-owned developer and parent company of Dubai Waterfront, Joyce's firm.
The penny dropped too late for Brown, Sunland alleges. By now it had already bought Plot D17 and paid Reed's firm a $14 million ''consultancy fee'' for releasing the land.
This is the essence of Sunland's allegations against Joyce and Reed, contained in a statement of claim lodged in the Federal Court in Brisbane this week.
Joyce and his Australian colleague at Dubai Waterfront, Marcus Lee, are in jail in Dubai awaiting trial for alleged fraud in relation to this deal. Reed - branded a fugitive by Dubai - is back in Melbourne, still a director of Prudentia. Reed's lawyers would not comment yesterday on the Sunland document, which alleges he and Joyce were misleading or deceptive, or reckless as to the truth. But Prudentia, which Sunland is also suing, has said previously that it ''at all times acted properly and with integrity'' and was surprised by Sunland's action.
Joyce's lawyer, Martin Amad, says his client denies all the allegations against him and will defend them vigorously.
The Sunland statement says Brown, then its chief operating officer in Dubai, met Joyce several times between March and July, 2007. Brown had asked Joyce if any waterfront land was available for purchase within his project. Each time, Joyce had responded there was none left; it had all been sold to secondary developers.
But on August 15, 2007, Brown says he met a Dubai Waterfront executive who told him a new plot with beach views would be created under a planned ''reconfiguration''. However, it was already ''taken by Angus Reed''.
Later that day, Joyce called Brown and said Reed was the contact point and that the plot could be bought at 135 United Arab Emirate dirhams ($44) a square foot; a property speculator was likely to pay 175 dirhams.
The next day, Brown called Reed in Australia. Reed suggested a joint venture to develop the land. Four days later, when they met in Dubai, Reed allegedly told Brown he could obtain the price of 135 dirhams a square foot from Dubai Waterfront, but ''I want compensation'' of 40 dirhams a square foot. He allegedly added that it would be more tax-effective to pay this as a fee to Prudentia for ''consultancy services''.
On August 29, Sunland's statement alleges, Joyce called Brown and said words to the effect: ''Sunland should come to an agreement with Reed as soon as possible because there were other buyers around, including Russians, who might offer Reed 220 dirhams per square foot or more for the land.''
Lee and Dubai Waterfront's senior legal counsel, Anthony Brearly, met Brown on September 12. Brown says one or both of them - he cannot be sure which - said ''you should immediately put your foot on the plot''. On September 19, 2007, the deal was done. Rather than a joint venture, Sunland would buy the whole plot. Reed accepted its offer of a flat fee of 20 million dirhams to buy Prudentia's right over the land, but Sunland agreed to an addition.
It alleges Reed negotiated a reduced sale price of 120 dirhams a square foot - and the saving would go to Prudentia as a ''land uplift fee''. Dubai Waterfront would compensate Sunland for that uplift fee by allowing it to increase the density of its construction. Better still, Dubai Waterfront would waive the entire purchase price if Sunland could complete the project within four years. Sunland has yet to turn a sod on the site.
After the deal, Prudentia arranged for its consultancy fee of 44,105,780 dirhams to be paid to a new subsidiary in Singapore, Hanley Investments.
On December 1 last year, the Sunland statement alleges, the director of Dubai's Financial Audit Department told Brown that Reed and Prudentia had no right to sell the land. On January 21 Dubai police interviewed Brown. Four days later, they arrested Joyce and Lee. Reed is believed to have been out of Dubai at the time. After six months in custody, Joyce and Lee were charged with fraud last month. Only then did police hand back the passport of Brown, who had been assisting them.
Sunland is suing Joyce, Reed, Prudentia and Hanley Investments.

Sunland claims Dubai developer sought $38m kickback

From The Australian 11 August 09
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The Packer family-backed property company Sunland has claimed that a Melbourne developer and his old school mate from Geelong Grammar conspired to defraud the company in a complex transaction on the Dubai waterfront in 2007.
Documents filed yesterday in the Queensland registry of the Federal Court give details of a case involving Australians Matt Joyce and Marcus Lee, who were employed in 2007 on the Dubai Waterfront project, and Melbourne-based property developer Angus Reed, who went to Geelong Grammar with Mr Joyce.
The documents allege that Mr Joyce and Mr Reed, who were well-known to each other, failed to give any indication of this relationship to Sunland's representative in Dubai, David Brown, when he was negotiating to buy land in the Dubai Waterfront, then one of the world's most expensive projects.
The documents claim that Mr Joyce had told Mr Brown that Mr Reed had purchased a valuable piece of waterfront land and that Sunland had paid Mr Reed over $14 million for the right to buy the land, even though Mr Reed had never actually owned it or had rights to buy it.
They claim that in mid-2007 Mr Brown had asked Mr Joyce if there was any waterfront land left in Dubai, and a representative of Dubai Waterfront told him that an existing block was being reconfigured to create a new block, D17, which would have water views.
In August 2007, Mr Joyce allegedly told Mr Brown that Reed had already bought D17, and had secured it at $50 per square foot, well below the going rate in the area, which was around $57.
Mr Joyce gave Mr Brown the contact numbers of Mr Reed, who claimed that he was in the process of purchasing the land, but was willing to enter an agreement with Sunland to develop it.
Mr Brown allegedly received further phone calls from Joyce urging him to move quickly or the land could be purchased by "the Russians" for a considerably higher price. In September 2007, Mr Lee, a project manager at Dubai Waterfront, and lawyer Anthony Brearley from Dubai Waterfront, phoned Mr Brown to say they were concerned that "marketing people will sell plot D17 and we will have no control over this".
But Mr Reed and Sunland were unable to come to terms on purchasing the land, so Sunland offered to purchase Reed's company's rights to D17 for $6.5 million, plus the difference in property value for the area between the going rate and the price Reed was able to negotiate, a total of $14.3m.
But the documents also claim that in December of that year, Sunland's Mr Brown was told by officials from the Emirates audit office that Mr Reed had never purchased the property in question, and there had been no reason why Sunland could not have purchased the property in their own right.
The documents allege that if Mr Joyce and Mr Reed -- who failed to tell Mr Brown of their relationship -- had not made the representations, then Mr Brown would not have entered into negotiations with Mr Reed, and instead would have negotiated directly with Mr Joyce for the purchase of D17.
It also alleges that "Joyce and Reed both knew that their representations were false, or were reckless as to their truth or falsity".
Mr Reed has skipped the country and is in Melbourne, while Mr Joyce and Mr Lee, who is from Sydney, have both been kept in detention in Dubai for the past year.
Gold Coast-based Sunland has James Packer on the board, but has taken a beating in its Middle East property deals as the market has dived.

Dubai bribery case: Shaping up to be a bitter public brawl

This is shaping up to be an enthralling, and very public, brawl. As a commenter on an earlier posting pointed out, this matter will be open to public gaze once it starts to process through the Australian Courts. If the Court case captures the public imagination, as it no doubt will, it will take on a life of its own. No matter what the eventual outcome, Dubai's reputation, in Australia at least, will be severely damaged, mud will be slung and some of its going to stick.
Source: Sydney Morning Herald 27 July 09
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FOR more than 150 years, Geelong Grammar has provided its privileged graduates with the keys to success in an Anglo-dominated Australia. But for the Old Grammarian classmates and property industry figures Angus Reed and Matt Joyce, some training in doing business in more exotic places like the United Arab Emirates might have been more useful.
The Herald can reveal that Mr Reed, a Melbourne-based developer, has emerged as the mystery man at the heart of a Dubai property deal gone bad; a transaction that has left Mr Joyce and and another Australian executive, Marcus Lee, languishing in prison for six months and facing trial for fraud.
Mr Reed and an Australian lawyer, Anthony Brearley, are believed to have left Dubai before a police investigation, thus avoiding jail. Well-placed sources last night confirmed that Mr Reed and Mr Brearley have been declared "fugitives" in Dubai and will be tried in their absence.
The Herald also understands that the James Packer-backed developer Sunland Corporation has Mr Reed and Mr Joyce in its sights as it prepares civil action to recoup millions it says it lost on the deal.
Like thousands of their colleagues, Mr Reed and Mr Joyce ventured to Dubai a few years ago in search of riches. The dream turned sour last year for Mr Joyce in particular, when the emirate's "miracle" property boom proved to be a very fragile bubble.
Until his arrest in January, Mr Joyce had been managing director and Mr Lee a senior executive of Dubai Waterfront, a subsidiary of the state-owned Nakheel Corporation. It is the world's biggest waterfront development.
Important to the charges against Mr Joyce and Mr Reed are payments allegedly made by Mr Reed's Australian company, Prudentia Investments, to a bank account in Jersey held by Mr Joyce. Both men are expected to insist that any such payments were unconnected with the Dubai property deal in question.
A source close to Mr Reed says he is deeply upset by his mate's predicament but has not returned to Dubai for fear of being arrested.
At the core of the row is the sale in 2007 of a parcel of development land by Dubai Waterfront to Sunland. Prudentia is believed to have partnered Sunland in the purchase of the waterfront site. But Prudentia sold its share of the project to Sunland as the boom continued through 2007. Now Sunland has put development of the site on hold and says it is the victim of fraud.
It has made a formal complaint to Queensland police and the Australian Competition and Consumer Commission. The Herald understands the company names Mr Reed, Mr Joyce and Mr Lee.
One source close to one of the families said the saga had led to tension between the two old school friends, a suggestion rejected by a spokesman for Mr Joyce.
Mr Joyce and Mr Lee insist they are innocent. Australian business sources have complained that the two became scapegoats amid the property collapse in Dubai, where "commissions" or kickbacks have been commonplace.
The Dubai prosecutors and Sunland, which has billions at stake in Dubai, see things differently. Sunland has stated publicly that it will seek "civil remedies in respect of the alleged fraud".
It has repeatedly stated that it is co-operating fully with the Dubai authorities in its investigation of Mr Joyce and Mr Lee but has denied being behind the police action against them.
Any civil action will be taken in Australia, not Dubai. But in what is shaping up as a bitter stoush, with big-name lawyers such as Robert Richter (QC, William Crockett Chambers in Melbourne and barrister for underworld gunman Mick Gatto) likely to be throwing the punches, the case is set to open a rare window into the opaque world of business and government in a country dominated by its ruler, Sheikh Mohammed bin Rashid al-Maktoum.
Mr Reed is well-known in property circles, including as an adviser to the Nauru Government in the 1990s, when it lost a fortune on the Melbourne property market.
Those who know the two men say Mr Joyce is quiet and cautious while Mr Reed is more entrepreneurial and daring. It is counter-intuitive, they say, that Mr Reed is now a free man at home in Toorak while Mr Joyce sweats it out in a Dubai jail.
After a thorough vetting by Mr Reed's lawyers, Prudentia issued a brief written statement. The lawyers would not allow Mr Reed to be quoted. Instead, a company "spokesman" said: "Some years ago, the Prudentia group, through its Singapore-based subsidiary, was involved in a transaction which we understand is the subject of the investigation by the Dubai authorities.
"The Prudentia group has at all times acted properly and with integrity and is concerned and surprised that there would be any allegations of wrongdoing against representatives of any of the parties involved in the transaction."
Mr Joyce's Melbourne lawyer, Martin Amad, restated his client's innocence and questioned Sunland's motives. He said the land sale was a "legitimate business transaction that occurred prior to the global economic downturn. Sunland has subsequently incurred a huge loss on the project and has written down the value of the land substantially."
He added: "Shareholders of Sunland would hope that Sunland exercised due diligence prior to purchasing the land. After all, they would have their shareholders believe they are an experienced and sophisticated property developer."
He said that, contrary to previous reports, there had never been an allegation of Sunland paying consultancy fees to Dubai Waterfront.
Mr Joyce's wife and three children and Mr Lee's wife are still in Dubai, awaiting the outcome of the fraud trial.
Sunland did not wish to add to a written statement made to the Stock Exchange last week.
In a separate matter in Sydney last week, Prudentia refused to comment about its plans for the Waratah Park Earth Sanctuary, where Skippy the Bush Kangaroo was filmed in the 1960s, after the RSPCA put down two emaciated kangaroos at the closed park. State authorities say Prudentia has failed to obtain a licence to care for more than 100 native animals in the park since it took over the site in Duffys Forest, on the northern beaches, in 2006. Residents fear the company has let the site run down because it wants to build houses there.

Dubai bribery case: The Sunland Connection

An extract from an article in GoldCoast.com.au. The rest of the article has the same content as quoted in an earlier posting. This piece gives a bit more information on the local connection in the UAE.
The photo shows The Atrium, a, now cancelled, project in Dubai that seems to be at the centre of the story.
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"The upmarket Dubai Waterfront site at the centre of the allegations had been earmarked for a $1.6 billion tower which Sunland was developing in partnership with a company linked to golfer Adam Scott.
The project, which was abandoned in March, was to have marked the first stand-alone development for Sunland in Dubai without the backing of the ruling Sharjah royal family."
http://www.emiratessunland.com/

Packer-backed developer to sue Dubai pair

THE James Packer-backed Gold Coast developer Sunland Group has complained to police and the corporate watchdog about two Australians accused of fraud in Dubai, and is expected to take civil action against the men to recover losses from their alleged crime.
Sunland, in which Mr Packer is a key shareholder and non-executive director, has laid the complaints against Matthew Joyce and Marcus Lee, executives from the colossal Dubai Waterfront project. The two have been charged with fraud after being jailed for six months on suspicion of bribery.
The pair insist they are innocent and Australian business sources have complained they became scapegoats amid the bursting of the property bubble in Dubai, where "commissions" or kickbacks are commonplace.
But now Sunland, which has billions at stake in Dubai, has made a formal complaint about Joyce and Lee to Queensland Police and the Australian Competition and Consumer Commission.
In a media release yesterday, the day after the fraud charges were revealed, the company said: "Sunland understands that the charges relate, at least in part, to the purchase by one of its subsidiaries of a site from the Dubai Government-owned master developer Nakheel (Dubai Waterfront LLC), at Dubai Waterfront in October 2007."
It is understood that Sunland paid commissions to Dubai Waterfront, where Joyce was managing director and steering the world's biggest waterfront development.
Sunland's managing director Sahba Abedian said the company had been assisting Dubai authorities with their investigations since December 2008 and would continue to provide help when required. The company said it did not instigate the investigation into the executives.
Mr Abedian said: "Sunland has also taken steps to report the actions of certain individuals to the Australian authorities and we are investigating civil remedies in respect of the alleged fraud."
The statement did not name Joyce or Lee, but the company has confirmed that its complaint and action were against the executives, not Dubai Waterfront or Nakheel.
It is believed that any civil action will be launched in Australia, not Dubai.
Mr Abedian confirmed that Dubai authorities had returned the passport of David Brown, the Sunland's chief operating officer in the Emirates, now that the they had completed their investigation. He said Mr Brown was a witness and not a subject of investigation.
Joyce's lawyer, Matin Amad, said he was shocked by Sunland's action.
"No complaint about Joyce or Lee has been brought to my attention," he said yesterday afternoon. "I can't imagine any circumstances under which a complaint could be justified. The alleged offence occurred in Dubai, not in Australia. It sounds like they have an ulterior motive in doing this."
Mr Amad said the case against Joyce and Lee is weak. Joyce's wife and three children and Lee's wife are in Dubai, awaiting the outcome of their fraud trial.
Sunland said it only released the information now as it had not wanted to interfere with the Dubai investigation.
====================
Source: The Age, Melbourne 22 July 2009

Sunland executive "not arrested" says company owner

Employee of development company Sunland Group is there as bribery witness, says owner
Article from: AAP, 2nd March '09
A development company part-owned by James Packer denies one of its employees has been arrested in Dubai over a bribery scandal, saying he's simply acting as a witness in the investigation.

Fairfax reported three property industry heavyweights were among a number Australians arrested in Dubai over property-related allegations.

One of the men named in the report, David Brown, is the Middle East head of the Sunland Group, a development company part-owned by Mr Packer, while the others, Marcus Lee and Matthew Joyce, worked for the state-owned Nakheel development company.

According to Fairfax, the allegations involve millions of dollars in consultancy payments by Sunland to Nakheel and another party over the purchase of a waterfront property.

But Sunland on Monday denied Mr Brown had been arrested, saying no allegations had been made against the company or its executives in relation to the scandal.

"Sunland advises its chief operating officer - Middle East, Mr David Brown, is a witness to the authority's investigation," a statement from the company said.

"He is not the subject of investigations, nor has he been arrested or detained as is stated in the press articles."

Sunland managing director Sahba Abedian said the firm supported the Dubai investigation.

"Sunland fully supports the Dubai government's commitment to ensure the region's property market is transparent," Mr Abedian said in the statement.

"We will continue to provide assistance where required.

"Maintaining the highest ethical standards in all our dealings has long been a core value of Sunland."

A lawyer for two of the men arrested said both had denied any wrongdoing.

Australian lawyer Martin Amad said his two clients, whom he would not name but were believed to be Mr Lee and Mr Joyce, had been held in solitary confinement without charge since their arrests on January 25.

"I put in a phone call to DFAT (the Department of Foreign Affairs and Trade) last week and I'm awaiting a return call from them," he told ABC Radio today.

"Hopefully we can meet with them to see what, if anything at all, the Australian government can do about two of its citizens in a foreign jail where they are being kept for investigation without charge."

DFAT on Monday said a report that 13 Australians had been detained in connection with the property scandal was wrong.

"It is not correct to say that the large majority of the Australians are being detained due to the building industry collapse," a DFAT spokeswoman said.

"Australians in UAE under detention/arrest are charged with a range of offences, from relatively minor to relatively serious.

"Some of the cases remain under investigation by local authorities and date back to February 2007."

DFAT said the number of Australians detained or arrested by local authorities in the UAE can fluctuate on a daily basis.

Now 13 Aussies arrested in Dubai collapse

From the front page of the Sydney Morning Herald
March 2, 2009

THREE property industry high-flyers, including the senior agent of a company part-owned by James Packer, are among 13 Australians under arrest in Dubai as its supposed property miracle has succumbed to the global financial crisis.

Legal sources in Dubai have confirmed that among those in jail or in effect under house arrest over property-related bribery allegations are:

■ David Brown, architect and the middle eastern head of the Sunland Group, a Queensland development company which is part-owned by Mr Packer. Mr Brown has been interrogated at least eight times and has had his passport confiscated in relation to a bribery investigation.

■ Marcus Lee, until recently a senior executive with the Dubai Government-controlled Nakheel development company. He is a former executive with the local property companies Jones Lang LaSalle and Investa. Mr Lee is in jail, without charge, and is facing investigation over alleged bribery.

■ Mr Lee's Nakheel colleague Matthew Joyce, former managing director of the Dubai Waterfront project, is also in jail without charge over alleged bribery.

Until now, only the arrests of Mr Joyce and an unnamed colleague had been made public.

The three executives are of particular concern to lawyers and the Australian embassy because of the seriousness of the allegations and the uncertainty of their future. United Arab Emirates law allows suspects to be held indefinitely without charge.

It is understood the bribery allegations involve millions of dollars in consultancy payments by Sunland to Nakheel and a third party over a waterfront property purchase. Nakheel is one of four development companies linked to the Dubai Government and its ruler, Sheik Mohammed bin Rashid al-Maktoum.

Mr Lee and Mr Joyce have been held in solitary confinement since January 25. They have been allowed only limited access to lawyers and family.

Mr Joyce's and Mr Lee's Melbourne lawyer, Martin Amad, refused to identify Mr Lee by name or discuss details of the cases. But he said he was anxious for both men as they enter their second month in custody without charge.

"We're concerned for the welfare of the accused in custody where they've been kept in solitary confinement," he said. "Their physical and mental health has deteriorated. We are becoming increasingly frustrated at the time it seems to be taking for the prosecution authorities to investigate the matter."

Commenting on the 13 Australians under arrest in Dubai, a Department of Foreign Affairs and Trade spokesman said: "The United Arab Emirates legal system is different to the Australian legal system. People who are under investigation can be held in detention for long periods of time without bail."

Some fear people are being made scapegoats. "There is a lot of face-saving to be done," said one Melbourne property player well versed in business in Dubai. "The sheik can never be responsible, so somebody else has to be."

Sunland's managing director in Australia, Sahba Abedian, confirmed Mr Brown had been interviewed by police but insisted his company was not "implicated in the investigation".