abraaj group: Dubai regulator slaps huge fine on Abraaj founder

The Dubai Financial Services Authority, DFSA, said chief executive Arif Naqvi was fined for “serious mistakes”.The regulator also said it would fine the former Abraaj senior manager and former chief operating officer Wakar Siddiq $1.15 million.

DFSA representation beautiful Reflects the seriousness of Naqvi’s alleged misconduct and is based on his earnings from the Abraaj Group.

While the fine is only temporary, it’s the latest twist in a saga that spanned multiple continents and touched some of the world’s wealthiest people. Abraaj managed $14 billion for investors at its peak before its collapse in 2018.

Naqvi and Siddique challenged the regulator’s decision and took the notice to the Financial Markets Court, where both parties will present their case. Therefore, the DFSA’s decision is provisional.

The two men tried unsuccessfully to block the issuance of fine notices through court and to hold court hearings in private.

Naqvi claimed innocence against extradition from the UK to the US, with prosecutors alleging that Abraaj Group lured US investors with promises of socially responsible investments but actually committed a massive fraud. He is also accused of taking hundreds of millions of dollars from Abraaj for personal gain.

Some of the U.S. investors allegedly defrauded include the Bill and Melinda Gates Foundation and a U.S. government agency that facilitates U.S. corporate investment in hospitals in developing countries.

A former executive of the Dubai-based company told a U.S. court in 2019 that he was wrong to remain silent as the Abraaj Group sought to win over new investors by inflating its finances to save itself from a huge cash crunch. recovered in.

After signing a cooperation agreement with U.S. prosecutors, Egyptian-born Mustafa Abdel-Wadood oversaw Abraaj’s investments as managing partner, which includes extortion, securities and Pleaded guilty to charges including wire fraud.

Naqvi founded Abraaj Group in 2002 and has since grown into the largest private equity firm in emerging markets. He is the company’s largest shareholder and final decision maker, according to regulators.

The regulator alleges that Navqi used a company registered in the Cayman Islands to mislead investors, withholding sales proceeds from investors who were unlikely to complain or question the company, and drafting misleading statements to investors to cover up misuse of their funds, And participate in the cover-up – make up the $400 million shortfall by borrowing money to make bank balances and statements.

Abraaj Group operates out of Dubai International Financial Centre, Dubai’s financial free zone. Known as the Dubai International Financial Centre, it is Dubai’s financial hub and features sleek mirrored business towers, Michelin-starred restaurants and luxury hotels for traveling executives.