DUBAI // The man behind a Dh50 million foreign-exchange scheme that promised to double investors’ money has been arrested, fraud investigators say.
Sydney Lemos, 36, from Goa in India, was chief executive of Exential, a forex trading company in Dubai Media City. Investors lost millions of dirhams when Exential failed to pay out after promising 100 per cent returns on a $25,000 (Dh91,800) investment.
The company, which had offices in Arenco Tower, was closed by the Department for Economic Development in July last year.
Legal experts issued new warnings to potential investors after Mr Lemos circulated an email encouraging new investment in an “advisory service”, trading under the Exential banner.
“As a result of allegations laid at Al Barsha police station the chief executive was arrested on Wednesday, December 21,” said a spokesman for Carlton Huxley, the UK fraud investigation specialists who are working with the law firm Abdul Rahman Naseeb Advocates to recover funds.
“We are working with various authorities both inside and outside Dubai, and looking at the alleged laundering of more than Dh50m by one individual.
“We have raised the question of how he could legally set up and run another investment fund when he was apparently never licensed to do this in the first place, is under investigation for illegal trading by the DED and has judgments against him from the civil courts.
“He has now been arrested on criminal allegations.”
John Rynne, a Carlton Huxley director and former senior officer with the Metropolitan Police in London, warned people about investing in schemes they know little about.
“We are working with the authorities in Australia and British Virgin Islands and will be reporting our findings to Dubai CID,” he said.
“Getting stolen money back is hard, dangerous, expensive work, so it is better not to lose it in the first place,” Mr Rynne said.
“Forex fraud is a growing problem which can and should be easily avoided, yet thousands of people in the UAE have been victims of these schemes.”
Exential claimed last February that delays in processing investors’ funds were related to anti-money laundering and compliance investigations in Australia.
Sarah, a South African lawyer who invested in an Exential fund, fears that all hopes of recovering her cash will be lost for good if criminal charges are brought against the chief executive.
“If he is facing criminal charges, any funds that he has will be used to sort out his own life before he repays investors,” she said.
“There is a concern that he will use that money to get out of his own legal situation. So many people have gone down the legal route with local law firms, a case should be strong enough.
“Unfortunately, I am not in a position to spend months in court with no guarantee of recovering any money. I know how quickly legal fees can add up.”
The international law firm Giambrone and lawyers from Mohammed Al Dahbashi are among those representing Dubai investors.
“Our lawyers in the forex litigation department are reviewing the evidence provided by our clients – the majority of whom are cabin crew and airline personnel in the Middle East,” said a Giambrone spokesman.
“Giambrone will continue to fight vigorously for the protection of customers and to ensure that the wrongdoers are held accountable.”
Police at Al Barsha station were not available to confirm Mr Lemos’s legal status.
nwebster@thenational.ae