The liquidators of BCCI sued Chief Labode Onadimaki Akindele, a Nigerian businessman, for $6,679,226 that he got in divestiture payments in 1988.
Akindele did not know this was part of a fraud scheme to enable BCCI Holdings to buy its own shares.
The liquidators argued his dishonesty could be inferred from his knowledge of the artificially arranged loan transactions and his unusually high-interest rate of 15%.
[1] Nourse LJ held that Mr Akindele’s knowledge in 1985 was not enough to make the transaction unconscionable, and for him to retain the benefits of the divestiture payments, even though there were rumours about BCCI’s management.
Dishonesty was not needed to establish liability for knowing receipt as a constructive trustee, Belmont Finance Corp v Williams Furniture Ltd (No 2) [1980] 1 All ER 393 considered.