A Canadian rug company owner has accused a Bermudian rug dealer of selling thousands of dollars worth of valuable Persian rugs without permission and putting his business in financial jeopardy.

Gheisar Gheisari of the Gheisari Rug Company in Richmond Hill, Ontario, has accused Bermudian rug dealer Bart Card of selling his rugs at a local auction in breach of a Supreme Court prevention order injunction which law firm Conyers, Dill & Pearman confirmed was issued in February, 2004.

Mr. Card is also accused of failing to pay money he allegedly owes Mr. Gheisari, who is himself facing charges in Canada of defrauding three Canadian banks of almost $1 million.

The Bermuda case is expected to go to trial in civil court early next year.

Mr. Card is understood to work for Card International, a Bermuda-based company which imports rugs and auctions them on the Island.

Mr. Gheisari told this week that in December, 2003, he shipped more than 500 hand-knotted rugs to Bermuda to be sold in auction.

According to Mr. Gheisari, Mr. Card owes him $97,236 ? after deducting expenses for the rugs.

The rugs were sold at an auction and Mr. Gheisari said they would retail at $500,000.

In order to do business in Bermuda, Mr. Gheisari, an Iranian whose family has been in the rug business since 1873, sent the rugs to Bermuda for auction through a dealer ? Mr. Card.

After deducting expenses, Mr. Card was to keep ten percent of the profits and send the remainder of the money he owed, along with the rugs which did not sell, back to Canada.

?He told me he did not have the money when I asked him for it,? said Mr. Gheisari. ?I trusted him and I assumed he was trustworthy and organised.?

Mr. Gheisari said he asked for the money from the 2003 auction but said Mr. Card claimed the bank had put a hold on his account and he could not pay.

Mr. Gheisari claimed the rugs were being kept illegally in Bermuda at a storage facility. He claimed Mr. Card sold off some of the rugs at an auction at Number One Shed last month in breach of the injunction preventing their sale.

Mr. Gheisari is now wary about doing business in Bermuda in the future.

?It was a disaster ? he broke my back,? he said. ?I?ve had to borrow money from the bank, I?m under so much stress I?m taking depression pills.?

Paul Harshaw, Mr. Card?s lawyer, declined to fully discuss the details of the case in the Press, except to say that the legal dispute was over who legitimately owned the rugs.

?The rugs are auctioned here in Bermuda, some of them have sold, not all of them have sold,? said Mr. Harshaw.

?A number of these rugs came to Bermuda from different sources with different agreements ? some were bought outright and others were bought with commission agreements.?

He confirmed his client did hold an auction to sell the rugs at Number One Shed last month.

Mr. Gheisari was charged in June with defrauding the Canadian Imperial Bank of Commerce, the Bank of Montreal, the Toronto Dominion Canada Trust and Capital One Mastercard of close to $1 million.

Mr. Gheisari, who was charged with the offences in Newmarket, Ontario, is attempting to pay back the money to the banks, according to Det. Con. Doug Dyke of the Major Fraud Bureau at the York Regional Police Station in Ontario.

If he is successful, it may result in a plea bargain before the case goes to trial, Det. Con. Dyke said.

Mr. Gheisari has also recently faced charges in Canada for domestic assault.

Det. Con. Dyke said he had asked Mr. Card, who lives in Canada, about his reasons for taking the carpets out of the facility. He said Mr. Card told him he removed the carpets and sold them as there was money owing on his account.

Conyers, Dill & Pearman is representing Mr. Gheisari.