A luxury Scottish hotel chain has described claims a key ally of former Libyan leader Muammar al-Gaddafi used its portfolio to launder money as “ludicrous and hugely damaging”.
The Crown Office is said to be investigating claims by the authorities in Libya that Ali Ibrahim Dabaiba used money meant for hospitals and housing in his homeland to buy property including the Kenmore Hotel in Perthshire.
A report in the Guardian said Libya’s attorney general had requested assistance from the Lord Advocate in 2014.
It said confidential documents alleged Mr Dabaiba laundered money embezzled from public funds in Libya using property in England and Scotland.
It is claimed he may have been helped by British associates based in Dunfermline.
The Dabaiba family has dismissed the allegations, maintaining they are not under investigation in Libya.
Their lawyer said they were “not wanted by any judicial, financial or security bodies”.
According to Libyan prosecutors, companies linked to the Dabaibas have invested in prestigious properties in England. The suspected assets are also said to include the 500-year-old Kenmore Hotel, which is managed by the Aurora Hotel Collection.
Steven McLeod, the group’s chief executive, said: “The Aurora Hotel Collection categorically refutes the allegations and the directors of the Aurora Hotel Collection vigorously deny any wrongdoing.
“These claims are both ludicrous and hugely damaging to the company and the directors. The company’s lawyers are now reviewing this matter and will be acting to ensure the claims are retracted and advising on further action.”
In his request for assistance, Libya’s recently retired attorney general, Abdulkader Radwan, claimed “huge amounts of money” may have been “illegally transferred to the banks in Britain and Scotland”.
The request for assistance said the Aurora group and another UK firm “may contain assets belonging to the state of Libya”.
A spokesman for the Crown Office confirmed it had received a request from the Libyan authorities, but declined to comment further.
He said: “We can confirm we have received a request for mutual legal assistance from the Libyan authorities. As this relates to an ongoing investigation it would not be appropriate to comment further.”