The Debt Panel: 'I invested for colleagues and lost it all - now I owe them Dh500,000'

The Dubai resident has been given a year to pay back the money he owes but does not have enough assets to liquidate

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I am a long-time UAE resident with a well-paying job in the market advisory industry. I taught myself to trade and started investing in global stock markets in 2017. It initially provided me with decent returns. This spurred on my colleagues, who asked me to invest on their behalf as well.

I collected Dh50,000 each from a few colleagues to invest in stocks and cryptocurrency. The stocks and other asset classes performed well in the beginning. However, things went downhill last year and all the stocks I invested in tanked. The cryptocurrency volatility did not help me either. Now, I am in debt and owe my colleagues a total of about Dh500,000, which includes the principal amount and returns combined.

I don’t know how I can repay them. I still have my job, which pays Dh20,000 each month. However, I also have a family to look after and a son who goes to school in the UAE. The only silver lining is that I do not have a personal loan, car loan or credit card debt.

What do you suggest I do? My colleagues have set me a year’s deadline to repay them. I have some savings in fixed deposits in India and an investment property as well.

However, I doubt whether that would be sufficient to repay the full debt. Should I liquidate these assets to pay off part of my debt, take out a personal loan or access cash from my credit card in the UAE? I desperately want to get out of this debt cycle and pay them back. Please advise. EC, Dubai

Debt panellist 1: R Sivaram, executive vice president and head of retail banking products at Emirates NBD

It is unfortunate that you have found yourself in this predicament. Trading in stock markets requires specialised knowledge and understanding of investment principles and it is best to take the help of qualified wealth specialists who can provide the right advice and guidance.

It is good that you don’t have any other debt to service and that you have a stable and well-paying job.

You could consider availing a personal loan, which can help you repay part of your commitment.

It is important to evaluate whether or not your friends can absorb some of the losses as their willingness to share in the investment for potential returns also would mean that they share in the downside risks.

There are specific regulatory practices put in place in the UAE through the regulations set out by the Central Bank to avoid these kinds of situations and to protect consumers
Nathan McFarlane, founder of

Credit card-based cash advances are best avoided in this case as it would be expensive and is best used only in emergencies.

Consider liquidating the assets you may own here or back home that can help you to cover part of the outstanding amount owed to your colleagues.

A good budgeting and spending plan will also help you to build additional disposable income in the coming months.

I wish you the very best in arriving at a feasible plan to address your issue so that you can be back on a stable financial footing soon.

Debt panellist 2: Nathan McFarlane, founder of

I’ve seen this happen to too many people and it’s inexplicable to me that it even happens. I have little to no patience for such practices.

There are specific regulatory practices put in place in the UAE through the regulations set out by the central bank to avoid these kinds of situations and to protect consumers.

If you had done this through a licensed broker, then the consumer will be protected in some way. However, if not, you may have unwittingly put yourself in further trouble.

In theory, your colleagues also took a very high risk in giving you the money and they have to take a level of responsibility for investing in you.

However, it sounds as though you are treating it as if you borrowed the money and are willing to repay it, which may be your saving grace.

I would avoid taking out further debt to pay it back. Instead, start with your assets, liquidate them and pay off as much as you can first.

Then, if you still have a good credit rating and a decent paying job, you would then need to look at a loan. Avoid credit cards at all costs as even loans on cards have much higher interest rates than regular loans. For the sake of your colleagues, I wish you the very best of luck.

Debt panellist 3: Felicity Glover, personal finance editor at The National

This is a very expensive lesson to learn. One of the most important rules of investing is to only invest what you can afford to lose – and clearly, you could not afford to lose your money, let alone that of your colleagues.

While it is a difficult financial situation for you to be in, paying your colleagues back is paramount.

You don't specify the accumulated returns versus the initial Dh50,000 they invested. As you know, investing is a risk and perhaps it is something they should also bear in mind in terms of the amount you pay them back.

I would strongly advise you not to take a cash advance on credit cards to help pay back the debt. As my fellow panellists say, the interest rate is too high to consider this option.

I am also loathe to recommend liquidating assets unless it is an emergency, but I think in your case this could help you pay the debt off quicker and lower the amount you may require to borrow as a personal loan, which seems to be your only option at this time to make up the shortfall.

I would also advise you to consider taking on a side hustle that could be used towards paying the debt off quicker – I am sure you have good skills that are in demand on sites such as FlexJobs, We Work Remotely and Fivrr.

It is also important that you cut back on your daily expenses and stick to a strict budget. You could consider moving to cheaper accommodation, taking public transport instead of taxis, cutting back on subscriptions and eating out less. Over the course of a year, you could save thousands of dirhams by doing this.

It will take a lot of hard work to pay off this debt, but you also have a steady income and no formal debts with banks, which, as you say, is a silver lining.

Finally, let this be a lesson to all: do not entrust your hard-earned money to amateur investors. If you do choose to invest your money through a financial adviser, check that they are licensed with the regulatory authorities in the UAE.

On the flipside, there are a number of safe do-it-yourself robo-advisory options available in the UAE for amateur investors to invest their money. These include the likes of Sarwa and Stashaway, both of which are regulated by the financial authorities in Abu Dhabi and Dubai, respectively.

The Debt Panel is a weekly column to help readers tackle their debts more effectively. If you have a question for the panel, write to

Updated: November 24, 2021, 5:00 AM