3rd UPDATE:Sama Dubai Staff Probed On Alleged Bribery-Official |
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Thursday, Aug 21, 2008
(Adds real estate stocks, comment, timeline of cases.)
DUBAI (Zawya Dow Jones)--Four employees of Dubai-based real estate developer Sama DubaiSama Dubai
have been arrested and are being questioned by Dubai's Public Prosecution on allegations of bribery and mistrust, according to documents seen by Zawya Dow Jones Thursday.
One of the people being held is Abdulsalam Almarri, chief executive of Sama DubaiSama Dubai's The Lagoons project, Public Prosecution documents show.
Spokespeople for Sama DubaiSama Dubai weren't available to comment after repeatedly contacted by Zawya Dow Jones, saying that the company's executive chairman - Farhan Faraidooni, according to Zawya.com - is presently out of the country.
Sama DubaiSama Dubai is part of state-owned Dubai HoldingDubai Holding, the conglomerate owned by Dubai's ruler Sheikh Mohammed bin Rashid al Maktoum.
The arrests at Sama DubaiSama Dubai are part of a widening police dragnet among senior corporate executives in the emirate, in what is a concerted effort by government officials to crack down on corruption.
Dubai is at the center of the Gulf region's construction boom triggered by the introduction of foreign ownership rights in 2002. The emirate expects to attract 184 billion U.A.E. dirhams ($50.1 billion) in real estate investment by 2010.
Dubai HoldingDubai Holding's real estate companies are at the forefront of this boom. TatweerTatweer, which is developing the emirate's $110 billion DubailandDubailand project, and Dubai Properties, are also part of the same group.
Corporate Scandals
The Sama DubaiSama Dubai arrests follow a series of corporate scandals beginning in April.
Earlier this week, Dubai-based Palm developer NakheelNakheel said that an existing employee and a former employee are being questioned on suspicion of bribery.
Dubai government officials told Zawya Dow Jones Tuesday that Egyptian national Karim Masaad, who NakheelNakheel said resigned as a sales executive a month ago, is being questioned in connection with alleged wrongdoing while working for the developer.
Masaad is the second person held by Dubai authorities in the NakheelNakheel investigation. Walid Al Jaziri, NakheelNakheel's general manager for sales, is also being questioned, the officials said.
Earlier this month, Adel Al Shirawi, the former chief executive of Islamic-mortgage lender TamweelTamweel (TAMWEEL.AI) and deputy chairman of Istithmar WorldIstithmar World, was arrested on suspicion of embezzlement.
Recent arrests suggest that Dubai's ruler Sheikh Mohammed bin Rashid Al Maktoum wants to clean up the emirate's reputation to ensure foreign investment continues to flow into the emirate as it seeks to position itself as a world-class tourism, real estate, financial and transport hub.
In a rare statement, Sheikh Mohammed's office earlier this week warned that "there will be no tolerance shown to anybody who tries to exploit his position to make illegal profits."
"Transparency is a problem in the U.A.E. but right now the government is increasing its regulatory role," said Marius Maratheftis, Standard Chartered Bank's head economist in Dubai.
Real estate stocks in Dubai have taken a battering amid the unfolding corruption scandals and the Dubai Financial MarketDubai Financial Market's Real Estate and Construction index has fallen more than 14% since mid-April.
DeyaarDeyaar has fallen 20% since April 16, while TamweelTamweel's shares have declined about 11% since Aug. 14.
"There is a short-term negative goodwill impact on Dubai as the (probes) show lack of corporate governance," said P. Krishna Murthy, chief executive at Al Rostamani Group's financial services division.
"The financial impact is more worrying but can only be calculated after complete information is available. Markets will be happy with more transparency and if corporate earnings are not hit," he added.
Privately-held Sama DubaiSama Dubai is developing eight projects across the Gulf region and North Africa, including the estimated $17.7 million The Lagoons project in Dubai and the Mediterranean Gate project in Morocco. It also has projects in Bahrain, Oman, Qatar and Tunisia.
Dubai corruption cases timeline:
April 16
Deyaar DevelopmentDeyaar Development CEO Zack Shahin is jailed in Dubai, Zawya Dow Jones reports
April 17
DeyaarDeyaar announces Shahin's resignation
Shahin is being held at the Dubai Prosecution's jail, a Dubai police official says
DeyaarDeyaar chairman says Shahin is being investigated for 'financial mishandling' and the investigation will have no impact on the profitability of the company
April 20
DeyaarDeyaar says it accepts the resignation of two more boardroom officials amid the ongoing financial investigation
April 21
Speaking from jail to Zawya Dow Jones, Shahin says he's innocent and that others are to blame for alleged wrongdoing at DeyaarDeyaar
April 23
Ganesan Krishna Kumar, the managing director of advertising agency Masterbrand (ME) Ltd, is being detained to answer questions concerning allegations of embezzlement at DeyaarDeyaar
April 28
The investigation into alleged financial wrongdoing at DeyaarDeyaar widens with confirmation that a third person, Charbel Boutros, has been detained by Dubai police
April 29
Shahin will be held by Dubai authorities for at least another two weeks, a Dubai Public Prosecution official says
Lebanon's Prime Minister Fouad Siniora is monitoring the status of Zack Shahin, a U.S. passport holder of Lebanese origin, a Lebanese government spokesperson tells Zawya Dow Jones
Dubai's assistant chief prosecutor Khaled Zarouni says a fourth person, Jose Mebar, has been taken into custody in the ongoing investigation into financial wrongdoing at DeyaarDeyaar
May 1
DeyaarDeyaar's shares are down almost 4% since April 16
May 20
Merrill Lynch cuts its rating on Dubai Islamic BankDubai Islamic Bank, which owns 41% of DeyaarDeyaar, to neutral from buy
June 9
British banker Charles Ridley is being held by Dubai Police as part of a bribery investigation involving a former Dubai Islamic BankDubai Islamic Bank vice president
June 11
Dubai Islamic BankDubai Islamic Bank confirms that its former vice president Rifat Al Islam Usmani is being investigated as part of a bribery probe
June 12
The Central Bank of the United Arab EmiratesCentral Bank of the United Arab Emirates calls for national and international banks operating in the Persian Gulf state to report suspicious bank account movements
June 15
Omair Mooraj, managing director and head of Islamic banking at U.S. investment bank JP Morgan Chase & Co., is being detained as part of the fraud investigation at Dubai Islamic BankDubai Islamic Bank
July 15
Dubai-based National Properties, a National Bonds Corp.National Bonds Corp. subsidiary, is transferring all assets under its management to DeyaarDeyaar. The transfer also involves management, a move seen as part of a clean-up act at DeyaarDeyaar
July 21
U.A.E. Minister of State Khalifa Bakheet Al Falasi faces charges in the emirates for breach of trust and fraud in a case filed by a Lebanese woman
Aug. 14
Adel Al Shirawi, the former chief executive of TamweelTamweel, and Feras Kalthoum, the mortgage lender's former head of investments, are being held by police in Dubai as part of a financial probe
Al Shirawi currently is vice chairman of Dubai government-controlled Istithmar WorldIstithmar World and also sits on TamweelTamweel's board of directors. Kalthoum is Istithmar WorldIstithmar World's chief financial officer.
Aug. 15
NakheelNakheel says one of its employees is being questioned on suspicion of bribe-taking
Aug. 17
DeyaarDeyaar Names Markus Giebel as the new CEO
Aug. 18
A statement issued by the office of Dubai's ruler Sheikh Mohammed bin Rashid Al Maktoum warns "there will be no tolerance shown to anybody who tries to exploit his position to make illegal profits"
Aug. 19
Dubai government officials say Egyptian national Karim Masaad, who NakheelNakheel said resigned as a sales executive a month ago, is being questioned in connection with alleged wrongdoing while working for the developer
The officials say Walid Al Jaziri, NakheelNakheel's general manager for sales, is also being questioned
Aug. 21
Four employees of Dubai-based real estate developer Sama DubaiSama Dubai have been arrested and are being questioned by Dubai's Public Prosecution on allegations of bribery and mistrust, Public Prosecution documents show
By Majdoline Hatoum, Mirna Sleiman and Stefania Bianchi, Dow Jones Newswires; +9714 364 4962; majdoline.hatoum@dowjones.com
(Nikhil Lohade and Maria Abi-Habib in Dubai contributed to this article.)
Copyright (c) 2008 Dow Jones & Company, Inc.
(END) Dow Jones Newswires
21-08-08 1254GMT
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Stories
Companies
| Company Name | Country | Industry |
| Qatari Diar Real Estate Investment Company | Qatar | Landlords and Developers |
| Mubadala Development Company | UAE | Investment Firms and Funds |
| Zuhair Fayez Partnership | Saudi Arabia | Construction and Design |
| ANC Holdings | UAE | Multi-line |
| Al Rajhi Investment Group | Saudi Arabia | Investment Firms and Funds |
| Saudi Telecom | Saudi Arabia | Telecommunications Services |
| Sama Dubai | UAE | Landlords and Developers |
| Barwa Real Estate Company | Qatar | Landlords and Developers |
| International Petroleum Investment Company | UAE | Investment Firms and Funds |
| Nakheel | UAE | Landlords and Developers |
Projects
| Project Name | Country | Sector |
| Ras Tanura Integrated Refinery and Petrochemicals Complex | Saudi Arabia | Oil and Gas |
| QP - Al Shaheen Refinery | Qatar | Oil and Gas |
| Qatalum Aluminum Smelter | Qatar | Industry |
| Dubai RTA - Dubai Metro - Purple Line | UAE | Infrastructure |
| Qatar Foundation - Sidra Hospital | Qatar | Real Estate |
| KNPC - Al Zour Refinery | Kuwait | Oil and Gas |
| WDEPC - Abu Qir Power Plant Expansion - Civil Works | Egypt | Power and Water |
| Saadiyat Island Development - Saadiyat Resort and Beach Residences (Phase 1) | UAE | Real Estate |
| IPIC - Abu Dhabi Crude Oil Pipeline (ADCOP) | UAE | Oil and Gas |
| Abu Dhabi Municipality - Salam Street and Mina Road Development | UAE | Infrastructure |
Is it first time in Dubai, such corrupt act took place, No this had earlier also because of negligence of lucrative law of Dubai, which allow top official to make illegal profit to their pocket and innocent people are in trap, how is that local official is aware of wrong doing on first hand only will come to notice when media is involved, who is closer to corrupt people media or employer's superior. So this official are also part and parcel of gammick?
After Govt spending a huge amount on young generation on education and these people are pilliar of next genration, but in vain.
After so much of scrutinity and stringent laws, how anybody can do this malpractice, without involvement of superior authority.
I suggest all superior authories should given be timely training in all aspects before any malpractice happen and exposed to media then to outside out.. [Report Abuse | Email to a Friend | Reply to this Comment]
The local authorities should not allow the likes of Seniora to interefere in Zack's case.. By Seniora's ill and devious standards, Zack Shahin would probably emerge as a hero... [Report Abuse | Email to a Friend | Reply to this Comment]