Two Abu Dhabi execs fined Dhs8bn, jailed for 15 years in money laundering case

The Abu Dhabi Criminal Court has sentenced the former chairman of the Board of Directors of a government-owned Abu Dhabi company, and its CEO, to 15 years in prison for money laundering.

It also ordered them to pay a fine and return about Dhs8bn to the companies.

The two men, who have not been named, “took advantage of their position in the company and misused public funds,” reported state new agency WAM.

The court also ordered the seizure of the proceeds of crime and the property of equivalent value, and sentenced the two accused to pay an amount of Dhs501,000 as temporary compensation to the two companies which claimed violation of their civil rights, and ordered the deportation of the second accused after he has served his sentence.

The two officials were accused of money laundering, misappropriation of public funds, forgery and use of forged documents, to deliberately transfer and conceal the nature of the funds obtained from the offence that intentionally prejudiced the interest of their employing party.

They reportedly misappropriated the funds and invested it into several companies.

Read: UAE passes law to combat money laundering, terror financing

The investigations by the Public Prosecution in Abu Dhabi revealed that the accused exploited the names of two companies to enter into agreements with companies based abroad, by misusing their positions in the parent company. They also concluded parallel and identical agreements with these foreign entities, on behalf of cloned companies which had the same name as their parent company. They then transferred the cash into the cloned firms.

They also ensured that all charges and obligations were transferred to their employers, while the cash from the agreements and contracts was transferred into their bank accounts.

The investigations further showed that the accused created several companies outside the country to create confusion between the original company and those established outside the country to cover up the misappropriation of funds.

They used these fake accounts to distribute the funds to others involved in the crime and finally transferred the rest to other accounts owned by them.

In a bid to crack down on money laundering, in November, plans were revealed to establish a new court to deal with money laundering and tax evasion crimes. A directive issued at the time said that the Abu Dhabi Judicial Department will organise training courses for judges and prosecutors specialising in money laundering and tax evasion.

Read: UAE to establish new court to combat money laundering and tax crimes

The National Committee for Combating Money Laundering and the Financing of Terrorism and Illegal Organisations, chaired by the governor of Central Bank of the UAE, has adopted several initiatives to mitigate financial crimes.

It includes the launch of a smart platform “FAWRI TICK” smart platform in September that supports communication and coordination between relevant government authorities and facilitates rapid detection of financial risks.

In January, the Central Bank of the UAE imposed financial sanctions on 11 banks operating in the country, amounting to a total value of Dhs45.75m. The penalties were based on the banks’ failures to achieve appropriate levels of compliance regarding their anti-money laundering and sanctions compliance frameworks.

Read: UAE Central Bank imposes fines worth Dhs45.75m on 11 banks