Financial authorities failed to act on allegations of fraud at the jeweller Vashi before the company collapsed with debts of £170 million ($230 million), The National can reveal.
John Ames, a senior manager based in London, told the Insolvency Service he believed investors were being shown wildly exaggerated sales figures and were falling for false claims that the “disrupter” jewellery company held huge stocks of diamonds.
The whistleblower's warnings were made in May 2022 but ignored, and investors, many of whom are from the Middle East, subsequently invested millions into the jeweller. The company’s founder, Vashi Dominguez, disappeared as his firm was wound up in April 2023.
An investigation by The National first revealed a £200 million diamond hoard investors believed existed as financial security turned out to be worth only £114,000. Last week, in a BBC Panorama television programme, they repeated their demands for authorities to examine whether Mr Dominguez’s behaviour amounted to fraud.
Those who put money into the company included some of the most prominent figures in the UK business world, such as mobile phone billionaire John Caudwell and Clive Schlee, former chief executive of the sandwich chain Pret a Manger.
Mr Ames has now revealed he contacted the Insolvency Service in May 2022, after he left his job as Vashi's chief technology officer in January that year. The organisation has the ability to investigate reports of serious corporate abuse such as significant misconduct, fraud, scams or sharp practice in the manner a company operates, as well as administering bankruptcy.
Mr Ames said he was willing to present evidence, including an internal sales report, which showed the sales figures were around £5.4 million for 2020 and £5.09 million for 2021. That contrasts with the last available public accounts filed with Companies House, which show Vashi’s stated sales for the year ending 2020 were £53.63 million and £105.42 million in 2021.
In his complaint to the Insolvency Service, Mr Ames alleges that the firm was “being dishonest about the source of the revenue they report to Companies House”. He also raised his suspicions that the diamond stock was a small fraction of what the company claimed, but the agency wrote back to say it was "not appropriate to use the powers available to the Insolvency Service to investigate the company at this time”.
“I honestly thought, what's the point?” Mr Ames told The National. “You’ve got a business, which in my opinion was falsifying its company returns, and I would have thought that would be something they would have been all over.
“I thought that would garner some kind of response, at least a phone call, and I could have shared a lot of information with them at that point.” He believes the failure to act on his concerns was a “missed opportunity” for the body to protect the investors. “I was probably a bit naive,” he said.
A representative for the Insolvency Service said the organisation became involved the following year, but by that stage it was unable to make progress with its inquiries. “We carried out an investigation in 2023/2024 following the liquidation of Diamond Manufacturers Ltd,” a statement read.
“It revealed irregularities that we were unable to clarify due to the principal director leaving the country. We have shared our findings with law enforcement partners.”
Bitter pill
For Mr Ames, this amounts to cold comfort. After leaving the company, he was motivated to contact the authorities about what he had seen on the inside. Mr Ames' fears had been stoked when diamond suppliers began seeking overdue payments.
By December 2021, he had reason to believe the company was raising investment on the basis of sales figures he felt did not match the numbers he was seeing. Colleagues also began to tell him the company safes were too small for the storage of the quantity of diamonds it claimed to possess.
“I was angry on behalf of my colleagues, but also, perhaps more importantly, the investors, because I just didn't think it was right,” he said. “The fact that they just didn't play by the rules and then just got away with it irritates me immensely.”
Investors have been calling for the Serious Fraud Office to look into the collapse of Vashi, but no investigation has been forthcoming. One investor, Michael Moszynski, who lost “tens of thousands pounds”, said he is “very angry” that the Insolvency Service failed to act on the warning.
“I invested after that report to the Insolvency Agency. So I personally feel aggrieved that had they acted, I wouldn't have invested and lost my money,” he said. Mr Moszynski said that “no one being held to account over this” was “disgraceful”.
Mr Dominguez's larger-than-life personality earned him a spot as the in-house diamonds expert on This Morning, a popular TV show in the UK.
His grand plan was to shake up the jewellery business by attracting younger customers with in-house workshops visible from the street at a central London shop that would tailor jewellery to embrace “the fundamental emotions of the wearer”. Mr Dominguez laid out plans for expansion into the US, saying the $300 billion jewellery industry was “ready to be disrupted”.
The company recorded a sales increase of 365 per cent in May 2021 and had ambitious plans to expand to fit out shops in New York. Creditors, including diamond suppliers, gradually lost patience, and court records show they were petitioning to have the company wound up from May 2022.
A former employee revealed on the Glassdoor employment website, which reviews companies, that staff were made to pretend to be customers in November 2022.
Avatar: Fire and Ash
Director: James Cameron
Starring: Sam Worthington, Sigourney Weaver, Zoe Saldana
Rating: 4.5/5
CHATGPT%20ENTERPRISE%20FEATURES
%3Cp%3E%E2%80%A2%20Enterprise-grade%20security%20and%20privacy%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Unlimited%20higher-speed%20GPT-4%20access%20with%20no%20caps%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Longer%20context%20windows%20for%20processing%20longer%20inputs%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Advanced%20data%20analysis%20capabilities%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Customisation%20options%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Shareable%20chat%20templates%20that%20companies%20can%20use%20to%20collaborate%20and%20build%20common%20workflows%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Analytics%20dashboard%20for%20usage%20insights%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Free%20credits%20to%20use%20OpenAI%20APIs%20to%20extend%20OpenAI%20into%20a%20fully-custom%20solution%20for%20enterprises%3C%2Fp%3E%0A
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
The Vile
Starring: Bdoor Mohammad, Jasem Alkharraz, Iman Tarik, Sarah Taibah
Director: Majid Al Ansari
Rating: 4/5
