Deposed mayor Lutfur Rahman has been declared bankrupt ahead of next week’s High Court hearing into his assets following legal costs which haven’t been paid since he was barred from office seven months ago. The former executive mayor of Tower Hamlets in London’s East End, who was disqualified in April for election malpractice and corruption, is due to return to the Court for a three-day hearing opening next Tuesday.
This follows the six-week Election trial earlier this year when judges banished him for five years following his discredited reelection in 2014.
Costs were originally set at £250,000, but have since risen after two more court hearings, to cover legal fees of the four election petitioners led by anti-corruption campaigner Andy Erlam and Brick Lane restaurant entrepreneur Azmal Hussain (above) who paid for the initial legal challenge.
But now the bankruptcy throws doubt on whether they will see a penny of it.
The 12-month bankruptcy order was made on November 18, the Insolvency Service confirmed.
Rahman, a lawyer by profession, is listed as “currently unemployed” and living in Old Montague Street in Whitechapel.
He stepped down as council Leader in 2010 to run for the powerful post of a newly-created executive mayor controlling the local authority’s £1.2 billion budget.
But he hit controversy as Labour’s candidate for mayor in 2010, in a power struggle with new council Leader Helal Abbas who unseated him as candidate and taking his place in the race to be Tower Hamlets’ first directly-elected mayor.
Rahman hit back by running for mayor as an independent against Abbas, with backing from Ken Livingstone, and storming home that year to win.
But his town hall administration soon came under fire over land deals and unexplained grants to minority groups.
It was the discredited polls for his re-election four years later, however, that brought him down, with complaints of malpractice, voter intimidation and intercepted ballot papers by his supporters. It led to an Election trial petition in the High Court which he lost in April and was ordered to pay the petitioners’ £250,000 legal costs.
Next week’s hearing looks into his personal assets, three properties in Whitechapel and Bow that were listed when declaring his financial interests as a councillor.
One is in Deal Street, a quarter-of-a-mile from his town house in Old Montague Street where he is registered to vote and was used on his election nomination papers. The other two are in Grace Street in Bow.
Co-petitioner Azmal, who guaranteed his own funds to bring the case in the first place, was cautiously optimistic at eventually getting back the legal costs because Rahman’s assets now worth £1.3m have been frozen.
But Rahman has already paid out £750,000 to K&L Gates for his own legal fees using security on the properties and loans from family and friends.
That may mean the petitioners only getting a fraction of any assets on settlement in court.
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