Richest man's brother branded a liar in case that could expose secrets of Brunei royalty

The brother of the Sultan of Brunei, the world's richest man, crossed swords with two former business associates yesterday at the High Court in London. Kathy Marks says that the case, which revolves around disputed property deals, will lift the veil that shrouds the activities of this obsessively secret royal family.

For nearly two decades, Robert and Rafi Manoukian were trusted friends and emissaries of the Brunei royal family, including the Sultan himself and his brother, Prince Jefri of Bolkiah. So close were they that they looked after the prince's son, Prince Hakim, during holidays from his school, Emmanuel College in London.

Yesterday the brothers, wealthy Armenian-born businessmen whose interests include a Jermyn Street boutique, went to the High Court to sue Prince Jefri, 44, for pounds 80m for allegedly failing to honour two London property deals. Prince Jefri, for his part, is counter-suing the Manoukians for more than pounds 100m, claiming that they systematically exploited their friendship with his family and made "unreasonable and concealed" profits out of him.

In a rare move, instead of seeking an out-of-court settlement away from the glare of publicity, the prince - who recently bought Asprey, the Queen's jewellers, for pounds 244m - has decided to submit himself to cross-examination.

The brothers, who once arranged the purchase of everything from golf balls to aircraft for the royal family, claim that he reneged on multi million-pound deals involving the purchase of an office block near the Savoy Hotel and the former Playboy Club in Park Lane, London.

Yesterday their counsel, Christopher Carr QC, made a robust attack on the credibility of the prince, who plays polo with Prince Charles and once flew the Chelsea football team to Brunei to play the national team over there. Mr Carr said that his version of events in the case, which is expected to last for up to six months, was "an utter deception and falsehood."

The court was told that when the Park Lane property came up for sale in 1988, Prince Jefri was interested in buying the upper four floors and "insisted" that the Manoukians should purchase the lower five storeys. The brothers agreed, as they did not wish to jeopardise other deals. In the early 1990s, when the market collapsed, Mr Carr claimed, the prince reneged on a pounds 25m verbal deal to renovate the lower floors of the building, which is now the prince's London home.

Mr Carr said the prince was claiming that he had bought his four storeys on the suggestion of the brothers, and had relied totally on Rafi Manoukian for financial information and guidance. This, he said, was "a complete invention". The prince's assertion that he was not even aware that the brothers were buying the lower floors was "a complete piece of fiction".

He said there was evidence that the Brunei Investment Agency, of which Prince Jefri was chairman, had obtained independent valuations of the property through other surveyors and his claim that he was relying solely on the Manoukians to represent his interests was "a plain attempt to mislead the court".

The investment agency owns hotels around the world, including the Dorchester in London, the Beverly Hills Hotel in Los Angeles and the Palace Hotel in New York. The Sultan, who is reputed to be worth about pounds 20bn, is said to have given full backing to his brother in fighting the lawsuit.

While the Sultan is fairly reclusive, Prince Jefri has a playboy reputation. He has four wives and three children. He owns a fleet of 600 cars and a yacht called Tits, complete with two speedboats christened Nipple 1 and Nipple 2. He once hired Rod Stewart to sing at a birthday party for his children.

The case continues today.

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