DUBAI // Six businessmen were yesterday sentenced to the longest jail terms ever handed out in a UAE fraud case.
The men were all sent to jail for 10 years at the Dubai Criminal Court of First Instance for embezzling Dh1.8 billion from the Dubai Islamic Bank (DIB). A seventh businessman was acquitted.
In a case that dates back to 2008 all the men, including two of the bank’s executives, denied committing fraud, embezzlement, bribery and forgery when they first appeared before the court.
The men were assisting in major bogus deals and embezzling public funds, Abdullah al Hamili, the bank’s chief executive, had told the court. He said they were deliberately helping others to embezzle public funds, inflicting intentional loss on the Government and its interests, and participating in illegal profiteering and forgery.
As well as being jailed, the six businessman – Briton CM, 48; RL, 50, who is also British; RU, 50, of Pakistan, a former DIB executive; O?M, 39, also of Pakistan; Turkish businessman EN, 36; and American Z?U – were ordered to pay a combined fine of Dh1.84bn, and to return the embezzled amount – Dh1.84bn – to the bank.
A?F, 58, the director of Plantation Holding at the DIB, was acquitted of aiding and abetting and criminal complicity. RU, OM, and Z?U were also ordered to pay a combined fine of US$2 million (Dh7.3m) and to return a further $2m to the DIB .
Court records show that the Dubai Government Financial Audit Department (FAD) initiated an investigation which concluded that $501m (Dh1.84bn) was missing, and that it had been given to the Turkish firm CCH – the firm for which RL, CM and EN worked for – in the form of credit allowances.
The FAD investigating officer, Mohammed Mustafa Hussein, told prosecutors that CCH, which was run by EN and represented by CM and RL, illegally acquired the funds from the bank with the help of the remaining defendants.
Witnesses also told prosecutors that after the investigation was launched, it was discovered that CCH owed $100m to two other banks.
In 2004, DIB agreed with CCH to invest the money in a project in which equipment related to oil work would be bought from Canada and used in Pakistan.
RU and OM were the executives in charge of overseeing the credit allowances for CCH. The two former DIB executives received $950,000 and $750,000 respectively as bribes from CCH to establish more credit for the company.
After RU and OM gave CCH excellent recommendations, the company was granted a $500m credit ceiling with the bank.
EN and CM collaborated with RL, who established a number of companies and submitted bogus documents to DIB to finance projects.
These three businessmen also forged documents that they submitted to DIB. OM and RU were charged with abusing their duties in the bank and accepting more than Dh5m in bribes.
The American businessman ZU defrauded DIB of Dh7.34m through fake documents that made it appear to the bank’s business partner that real deals involving real money were taking place.
In August last year, the court ordered the case to be sent back to prosecutors for reinvestigation. Defence lawyers had asked the court to dismiss the case on the grounds of flawed investigations, and also asked the court to add four existing DIB board members to the list of defendants.
Defence lawyers had asked that the former DIB chairman, MK, the director of commercial financing, M?K, the head of operations, MN, and the head of the risk assessment department, FH, be charged with fraud and perjury, citing the fact that the fraud would not have been possible without their consent.
However, during the new trial, which began in January, the court refused to include the board members.
In his ruling in August, Judge Hamad Abdel Latif ordered the reinvestigation on the grounds that prosecutors should investigate accusations that the defendants were “causing intentional harm to the bank” and “the facilitation of embezzlement”.
Judge Abdel Latif also said that while the case was built on such accusations, prosecutors failed to include the charges on their arraignment sheet.
The new charges were relabelled as crimes against public wealth and crimes that damaged the interest of a government institution.
The verdict is subject to appeal within 15 days.
