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Khashoggi in hot water again

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Adnan Khashoggi, the Saudi Arabian arms dealer, international tycoon and former Utah real estate developer, is back in court again for the same reasons that made him run out of Salt Lake City more than a decade ago and never come back: bounced checks.

The London newspaper The Guardian said this week that Khashoggi wrote $5.25 million worth of bad checks at London's Ritz Hotel casino during a gambling spree in 1986 - the same year that his burgeoning Utah empire collapsed.Guardian reporter Jamie Wilson said the casino is now suing Khashoggi for some $13.2 million, which includes the original debt and $8.25 million in interest.

Khashoggi's reputation as a billionaire was enough for his A.K. Utah Properties Inc., renamed Triad America, to launch development in 1975 of the Salt Lake International Center business park west of the airport and, later, the first phase of the Triad Center multiuse project north of the Delta Center downtown.

The International Center was far enough along when Khashoggi left town, owing local banks and contractors millions, that it has grown and prospered over the past dozen years.

But his grandiose plans for the Triad Center to become the "Rockefeller Center of the West" ended with the first phase as it became clear that his pockets were not as deep as reputed.

His last known visit to Salt Lake City was on June 6, 1985, when he came for the groundbreaking of the first Triad Center office building and to attend the graduation of his son, Mohamed, from the University of Utah.

After the collapse of Triad, he told the Deseret News in an angry phone interview from his home in Paris - one of many around the world - that it was Utah's fault, not his, that his investments here had collapsed. He even claimed that the Great Salt Lake had flooded the Kennecott mine, contributing to his problems, causing many to question his grasp on reality.

Why did the Ritz wait 12 years to sue Khashoggi over his gambling debt? Nicholas Merriman, an attorney for the Ritz, told the judge in the case Tuesday that from 1986 to 1990, Khashoggi kept promising to pay but that he had "financial difficulties."

Khashoggi's lawyers claim that the gambling debt is not legally enforceable because he had an arrangement with casino management that allowed him to gamble on credit, which is illegal in Britain. Money owed from commission of a crime is not a legal debt.

Wilson quotes Nicholas Merriman, the attorney for the Ritz, as saying that defense is nonsense. Merriman said Khashoggi had gambled more than $16 million between the end of January and April 10, 1986.

"His gambling was initially successful and he won," said Merriman. "It was only in the later stages that he lost."

Both sides agree that Khashoggi signed 16 checks for $330,000 each, drawn on an account with the Swiss Banking Corp. of Geneva, during three days at the end of March and on April 10, 1986. The checks were returned for insufficient funds.

Khashoggi said he had an understanding with unnamed casino managers that they wouldn't cash the checks because he was waiting for funds due him. The case was continuing this week.