DUBAI // The Emirati property magnate Abed al Boom was convicted yesterday of 3,695 charges of fraud and sentenced to 923 years and nine months in prison – three months for each offence.
Al Boom was not present at the special tribunal court hearing when it issued its verdict. He was found guilty of breaching the trust of 3,706 investors and embezzling Dh960 million of their money.
Judge El Saeed Bargouth acquitted him of 11 further charges of fraud. Al Boom’s five co-accused, who included his brother and two women, were cleared of all charges.
Despite the lengthy prison sentence, al Boom may serve only 10 years in jail, the maximum under the UAE penal code when combined sentences add up to 20 years or more.
Al Boom spent investors’ money on parties, boats and luxury cars. Only one per cent of the stolen money was recovered and seized by authorities.
A member of al Boom’s defence team said yesterday they were waiting to read the judgment sheet before filing an appeal.
His defence had asked the court to dismiss the charges because they violated a decree by Sheikh Mohammed bin Rashid, Ruler of Dubai and Prime Minister of the UAE, creating a committee to liquidate al Boom’s assets and collect on behalf of third parties, and stopping all civil and criminal proceedings against him.
Judge Bargouth dismissed that argument after prosecutors proved to the court that they had charged al Boom two months before the decree was issued on August 4, 2009.
“We have issued our charge sheet from June 4 … two months before the decree,” a prosecutor told the court.
Al Boom had earlier been sentenced to up to three years in jail in four separate cases of bounced cheques, but the Dubai Court of Appeal overturned those sentences last month and referred all the cases to the liquidation committee appointed by Sheikh Mohammed.
Prosecutor Younis al Baloushi told the court al Boom and his accomplices had “acted like animals” after they cheated the investors of their savings.
He created a bogus property investment portfolio, took clients’ money, then doled out small payments to the investors so they would think their funds were generating a return.
“Your honour, how can a man who in 2002 owned only one car that was worth less than Dh30,000 own 53 cars a few years later and become a socialite?” Mr al Baloushi said.
Al Boom’s charge sheet alone comprises about 1,500 pages. Additional documentation for the case is stored in 65 boxes, each containing about 500 pages, a total of more than 32,500 pages of depositions and evidence.
The Chief Justice of the Dubai Criminal Court, Judge Ahmed Ibrahim Saif, ordered the trial to be heard by a special tribunal because of the sheer size of the case.
Al Boom has two weeks to appeal. Any challenge would be heard by the Dubai Misdemeanours Court of Appeal.
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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.”
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Thursday December 27
Men's quarter-finals
Kevin Anderson v Hyeon Chung 4pm
Dominic Thiem v Karen Khachanov 6pm
Women's exhibition
Serena Williams v Venus Williams 8pm
Friday December 28
5th place play-off 3pm
Men's semi-finals
Rafael Nadal v Anderson/Chung 5pm
Novak Djokovic v Thiem/Khachanov 7pm
Saturday December 29
3rd place play-off 5pm
Men's final 7pm
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At a glance
Global events: Much of the UK’s economic woes were blamed on “increased global uncertainty”, which can be interpreted as the economic impact of the Ukraine war and the uncertainty over Donald Trump’s tariffs.
Growth forecasts: Cut for 2025 from 2 per cent to 1 per cent. The OBR watchdog also estimated inflation will average 3.2 per cent this year
Welfare: Universal credit health element cut by 50 per cent and frozen for new claimants, building on cuts to the disability and incapacity bill set out earlier this month
Spending cuts: Overall day-to day-spending across government cut by £6.1bn in 2029-30
Tax evasion: Steps to crack down on tax evasion to raise “£6.5bn per year” for the public purse
Defence: New high-tech weaponry, upgrading HM Naval Base in Portsmouth
Housing: Housebuilding to reach its highest in 40 years, with planning reforms helping generate an extra £3.4bn for public finances