UAE hit by white collar crime investigations

The UAE is making a big push on corruption, with several high profile real estate company execs in trouble with the police, ministers being charged, and even an Abu Dhabi policeman too.

Its true that so far, everything points to individuals abusing their positions to fill their boots. Where-ever there's a river of cash, someone will always try to divert a bit here and there.

Dubai sets top priority as war on corruption
Bradley Hope
Last Updated: August 18. 2008 12:32AM UAE / August 17. 2008 8:32PM GMT
The investigation has received widespread publicity and the shares of companies where questioned executives have worked have fallen sharply.
On the heels of criminal investigations into two senior businessmen in Dubai, the Public Prosecutor’s Office said that “fighting corruption is at the top of the [Dubai] Government’s priorities”.

The unusual public statement, released through the media office of Dubai’s Ruler, was the first formal acknowledgement that the emirate’s authorities are conducting a series of investigations aimed at alleged white-collar financial improprieties.

“Any employee exploiting his position to make illegal profits will not have immunity,” the prosecutor said. “The strictness with which some violations that emerged in the recent past were dealt with confirms the Government’s commitment to maintaining the highest global standards in fighting corruption and enhancing its achievements in the economic, financial and legislative fields.”

The statement came just days after it was revealed that two businessmen – Adel al Shirawi, the vice chairman of Istithmar World and former chief executive of Tamweel, and Walid al Jaziri, the general manager of sales at Nakheel – were being questioned on allegations of financial irregularities. The investigation has received widespread publicity and the shares of companies where questioned executives have worked have fallen sharply.

“The Government will continue to have a strict stance against all aspects of corruption and will take legal measures against violators,” said the statement, which was distributed by the media office of Sheikh Mohammed bin Rashid, Vice President of the UAE and Ruler of Dubai. “There will be no tolerance shown to anybody who tries to exploit his position to make illegal profits.”

The Government of Dubai’s investigation into corruption first emerged publicly in April and has revolved around some of the biggest corporate names in the city, although all of the companies say the investigations concern alleged improprieties by individuals, not corporate behaviour.

Zack Shahin, the former chief executive of Deyaar Development, was arrested in April on charges of fraud. The investigation was then expanded to include Dubai Islamic Bank and other senior businessmen were arrested.

Mr Shahin has maintained his innocence. Mr Shirawi and Mr Jaziri have not been available for comment.

While the arrests have been widely reported, prosecutors have released no details or evidence supporting allegations of improprieties against any of those arrested or questioned. The Public Prosecutor’s Office said the results of the “ongoing investigation” would be announced when they were complete.

“The Dubai Government follows a transparent and clear policy on such issues,” the statement said. “There are strict directives to have zero-tolerance towards all aspects of corruption, bribing and taking advantage of officials’ positions.”

Nasser bin Hassan al Shaikh, the chairman of Deyaar Development and Amlak Finance, said he offered his “complete commitment” to the highest standards of corporate governance, which he characterised as “central to Dubai’s enduring legislative and economic success story”.

Official acknowledgement of the white-collar investigations comes as shadows fall over the local property market.
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There was the report in the Gulf News that real estate giant Nakheel's general manager of sales, Walid Al Jaziri, is being questioned by authorities for taking kickbacks. Nakheel is the Dubai World company behind the three huge Palm Islands projects.

Real Estate company Tamweel is in trouble too. The Dubai police have confirmed that Tamweel's former CEO Adel Al Shirawi faces investigation for fraud and possible embezzlement, which is interesting as its a publically traded share (now being dumped by investors), yet over the past weeks Tamweel has apparently issued two separate denials of any such investigation. The company, listed on the Dubai Financial Market, told officials there that it "has received no formal notification of such an investigation from relevant authorities". Hmmm. Is mis-leading the market also crime in Dubai? Gulf News

Bloomberg
Published: August 14, 2008, 16:11
Dubai: Tamweel PJSC's former chief executive officer Adel Al Shirawi is under investigation by the Dubai public prosecution's office for alleged financial wrongdoing, a Dubai police official said.

Al Shirawi is being investigated for alleged embezzlement and mistrust while employed by the UAE's biggest mortgage provider, Saleh Hamed, head of Bur Dubai police, said in a telephone interview on Thursday.

The Dubai police have referred the case to the emirate's public prosecution office, he said.

Al Shirawi was arrested on Aug. 5 as part of the investigation, Zawya Dow Jones reported, citing an unidentified Dubai police official.
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It would be good if this new found transparency spread to Oman too. Its all to common that I hear how the everday 'man in the street' in Oman assumes that many of those in positions of public authority and trust are enriching themselves at the expense of the public purse. This does not mean they think its endemic, but not as uncommon as claimed. But what is more concerning is the apparent acceptance by many Omani's I talk to that such dealings are unsurprising and that nothing will be done about them.

My hope is similar to blogger Sultan Al Qassimi that this recent trend of official investigation and action in the parts of the GCC will continue and spread(see the recent Kuwaiti Crown Prince efforts).

Corruption is a scurge across the world. It would be great to see Oman lift the public profile of its anti-corruption efforts and show the public that Oman too means business when talking about stopping corruption in both Government Offices and publically traded companies. There were no official reports on the bribery allegations made in Europe that Ericsson had bribed an ex-Omani Minister of Communication. And of course the media here didn't report it either. This has to change. And I don't mean announcements of a workshop, but, as we are seeing elsewhere, actual prosecutions and publically reported investigations.

Oh, but then, there isn't any corruption in Oman. I forgot.

Except if you look at the Transparency International 2007 CORRUPTION PERCEPTIONS INDEX where countires are scored from 0 (v corrupt) to 10 (no corruption at all), Oman scored 4.7, ranking it 53rd and similar to Greece and Jordan. OK, not bad you might say, and I'd agree. But hardly virginal. (UAE was 34th by the way...)