A Family Affair

Its implications may not quite rise to the level of Cain versus Abel, but new details about a bizarre dispute between two of the world's wealthiest brothers—Hassan Bolkiah, the Sultan of Brunei, and his younger brother Prince Jefri Bolkiah—could soon be revealed in a New York lawsuit. After years of legal machinations, American lawyers are expecting later this month to question Jefri in a sworn deposition.

The deposition is part of a long-running dispute between the humongously wealthy Jefri and a married couple from Britain who once served as his personal aides and confidants. But, if it happens, Jefri's testimony is expected to illuminate an epic financial and legal battle between the prince and his elder brother who was once the world's richest man. Jonathan Berman, a lawyer for Prince Jefri, confirmed that Jefri's deposition is scheduled for next week and that the prince plans to attend. An American lawyer for the sultan did not immediately respond to a request from NEWSWEEK for comment.

The feud between the sultan and his brother has been going on since at least the late 1990s and has spawned a globe-circling mire of litigation which has ensnared (and enriched) attorneys, solicitors, bewigged barristers, and judges from the isles of Borneo to Britain to Manhattan. The focus of the dispute is, unsurprisingly, money, and the luxuries it can buy.

Even nobles like the royal dynasties of Britain, Holland, or Spain, seem almost petit bourgeois when compared with the Bolkiahs. An enclave carved out of the Bornean jungle by British colonists, Brunei, and its autocratic ruling family, became colossally wealthy when the price for its extensive oil reserves soared. In the 1980s, according to a chronology published in British court rulings, Prince Jefri was one of his brother's most trusted lieutenants, serving as the principality's finance minister and also as chairman of the Brunei Investment Authority, which is supposed to invest vast oil revenues for the nation's benefit.

The dispute that separated the Bolkiah brothers appears to have erupted following an independent 1998 investigation of how and why around $40 billion worth of "special transfer" payments were made between 1983 and 1998 from the accounts of the investment agency. According to a U.K. court ruling, the Brunei government concluded that, "in round figures," of the missing $40 billion, $14.8 billion had made its way into accounts controlled by Prince Jefri, another $8 billion had gone to accounts controlled by the sultan, and $3.8 billion had been used for "government purposes." It could not be determined who received the approximately $13.5 billion balance of "special" payments or where or why they were made.

The discovery of the $40 billion dollar hole in Brunei's national nest egg touched off a worldwide treasure hunt in which Prince Jefri's latest U.S. deposition, scheduled to begin on Sept. 30 at the New York offices of his former aides' lawyers, is only the latest chapter. In February 2000, according to a U.K. court ruling, Brunei's investment authority and government alleged that the $14.8 billion reportedly paid to Jefri allegedly had been "misappropriated." Subsequently, the Brunei government obtained injunctions freezing Jefri's assets in Britain and Brunei.