Jail and fine for Dubai Lagoons' former CEO

Jail and fine for "A.M." the former CEO of Lagoons.  The Lagoon site languishes on the outskirts of Dubai surrounded by huge hordings that were once covered with colourful pictures of the proposed site and the lifestyle it offered.  Most of the large posters have now gone, removed by wind, sand and sun, while the tattered remains of others cling to the boards.
Source: Gulf News
Picture: Sama website
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The former CEO of Lagoons, a Sama Dubai project, faces three years in jail after the Dubai Appeals Court scrapped his acquittal of committing financial irregularities yesterday.
Presiding Judge Mustafa Al Shennawi on Tuesday convicted the 43-year-old Emirati former CEO, A.M., of abusing his duty as a public servant and accepting bribe. He will be jailed for three years and has been fined Dh2.89 million and ordered to repay the same amount (the bribe amount) to Lagoons.
The Appeals Court overturned A.M.'s primary judgment, who had been pronounced innocent by the Dubai Court of First Instance in July last year.
Al Shennawi also sentenced Lagoon's former executives, 42-year-old Emirati M.M., his 23-year-old compatriot N.Q. and 28-year-old M.S. (who doesn't carry documents), to three years in jail each. They were also slapped a joint fine of Dh4.8 million and ordered to repay the amount to Lagoons.
M.M., Lagoon's former sales manager, M.S., the ex-sales executive, and Damac's former property development director, 32-year-old Syrian, A.H., will each spend a year in jail after the court convicted them of exchanging bribe worth Dh650,000. The Appeals Court ordered slapped them a joint fine of Dh650,000. Al Shennawi acquitted A.H. of aiding and abetting M.A. and M.S. collect a bribe worth Dh2.3 million over a three-land deal.
Moreover, the appeals court confirmed the acquittal of M.A. and N.Q. of revealing the company's secrets by providing an investment house with details about their clients, as well as information and prices of properties owned by Sama Dubai.
Defence lawyers are expected to appeal yesterday's judgment before the Cassation Court within 30 days.
At an earlier hearing, a prosecutor submitted an official letter stating that the funds of Sama Dubai are public and informed the Dubai Appeals Court that five executives of the company charged with financial irregularities are in fact public servants.
"We received an official letter from the Financial Control Department [FCD] at the Rulers Court confirming that the funds of Sama Dubai and Lagoons are public and that their employees are public servants," said the Public Prosecution's representative when he handed FCD's letter to Al Shennawi.
The five executives had earlier pleaded not guilty and refuted their charges.
According to the charges sheet, prosecutors had charged M.A., N.Q. and M.S. with taking Dh4.8 million in bribe against unlawfully selling/reselling lands belonging to Sama Dubai.
Lagoons' former CEO was charged with breaching his duties by requesting from one of his company's clients, five apartments worth Dh2.7 million and a cash sum of Dh200,000 in bribe against failing to preserve the rights of Sama Dubai and causing it to incur a loss of Dh137 million.
Charge
The Public Prosecution charged A.M. with preventing Sama Dubai from gaining a Dh4.6 million in ownership transfer fees.
A.H. was accused of accepting Dh650,000 in bribes from M.A. and M.S. and aiding and abetting them. M.A. and M.S. were charged with aiding and abetting A.H. in committing the bribe crime.
An Egyptian financial controller, from Dubai Government's Financial Control Department, testified that A.M., when he was Lagoons' former chief executive, should have preserved the company's rights and increased its earnings. "He caused Sama Dubai to incur a purported loss of Dh137 million," claimed the Egyptian.
An Emirati senior executive from Sama Dubai testified that A.M. failed to take the proper action against the company which was late in paying the instalments of certain properties.

Dubai bribery case: The Sunland Connection

An extract from an article in GoldCoast.com.au. The rest of the article has the same content as quoted in an earlier posting. This piece gives a bit more information on the local connection in the UAE.
The photo shows The Atrium, a, now cancelled, project in Dubai that seems to be at the centre of the story.
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"The upmarket Dubai Waterfront site at the centre of the allegations had been earmarked for a $1.6 billion tower which Sunland was developing in partnership with a company linked to golfer Adam Scott.
The project, which was abandoned in March, was to have marked the first stand-alone development for Sunland in Dubai without the backing of the ruling Sharjah royal family."
http://www.emiratessunland.com/

Packer-backed developer to sue Dubai pair

THE James Packer-backed Gold Coast developer Sunland Group has complained to police and the corporate watchdog about two Australians accused of fraud in Dubai, and is expected to take civil action against the men to recover losses from their alleged crime.
Sunland, in which Mr Packer is a key shareholder and non-executive director, has laid the complaints against Matthew Joyce and Marcus Lee, executives from the colossal Dubai Waterfront project. The two have been charged with fraud after being jailed for six months on suspicion of bribery.
The pair insist they are innocent and Australian business sources have complained they became scapegoats amid the bursting of the property bubble in Dubai, where "commissions" or kickbacks are commonplace.
But now Sunland, which has billions at stake in Dubai, has made a formal complaint about Joyce and Lee to Queensland Police and the Australian Competition and Consumer Commission.
In a media release yesterday, the day after the fraud charges were revealed, the company said: "Sunland understands that the charges relate, at least in part, to the purchase by one of its subsidiaries of a site from the Dubai Government-owned master developer Nakheel (Dubai Waterfront LLC), at Dubai Waterfront in October 2007."
It is understood that Sunland paid commissions to Dubai Waterfront, where Joyce was managing director and steering the world's biggest waterfront development.
Sunland's managing director Sahba Abedian said the company had been assisting Dubai authorities with their investigations since December 2008 and would continue to provide help when required. The company said it did not instigate the investigation into the executives.
Mr Abedian said: "Sunland has also taken steps to report the actions of certain individuals to the Australian authorities and we are investigating civil remedies in respect of the alleged fraud."
The statement did not name Joyce or Lee, but the company has confirmed that its complaint and action were against the executives, not Dubai Waterfront or Nakheel.
It is believed that any civil action will be launched in Australia, not Dubai.
Mr Abedian confirmed that Dubai authorities had returned the passport of David Brown, the Sunland's chief operating officer in the Emirates, now that the they had completed their investigation. He said Mr Brown was a witness and not a subject of investigation.
Joyce's lawyer, Matin Amad, said he was shocked by Sunland's action.
"No complaint about Joyce or Lee has been brought to my attention," he said yesterday afternoon. "I can't imagine any circumstances under which a complaint could be justified. The alleged offence occurred in Dubai, not in Australia. It sounds like they have an ulterior motive in doing this."
Mr Amad said the case against Joyce and Lee is weak. Joyce's wife and three children and Lee's wife are in Dubai, awaiting the outcome of their fraud trial.
Sunland said it only released the information now as it had not wanted to interfere with the Dubai investigation.
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Source: The Age, Melbourne 22 July 2009

Aussies face bribe charges in Dubai

From the Sydney Morning Herald 20 July 09
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Two Australian businessmen have been formally charged with fraud, almost six months since they were thrown into a Dubai prison.
Marcus Lee, from Sydney, and Matt Joyce, from Melbourne, were arrested in January on suspicion of bribery while working on a development project for the United Arab Emirates government-owned Nakheel property group.
Mr Joyce's lawyer Martin Amad today told ABC Radio formal charges had been laid, although the exact details of the allegations were still not known.
"We've just received the charges yesterday and we haven't had a chance to have it translated," he said.
The charges are related to fraud.
The men were each held in solitary confinement for seven weeks, had been moved between three prisons and were struggling to deal with their detainments, Mr Amad said.
Although he had yet to read the prosecutor's brief, he suspected the case against the pair was weak.
"A particular set of circumstances may lead to charges in Dubai, but may not be sufficient in Australia and I think that's probably the case here."
The federal government has confirmed 91 Australians have been arrested in the UAE - most in Dubai - since January 2008.
Mr Amad said the figure was unlikely to recede, given foreigners were increasingly being made scapegoats for soured business deals.
"More and more people are now starting to understand the risks in doing business overseas," he said.
"With the impact of the global financial crisis, I think more and more people will be charged on similar allegations and I think Australians and the Australian Government need to be aware that this is a distinct possibility."
Mr Amad said in a statement later that the wives of Mr Joyce and Mr Lee, and Mr Joyce's three children, were all in Dubai awaiting the outcome of the legal proceedings.
"The experience, and concern about the eventual outcome of the case, has taken its toll on the two men and their families," he said.
The pair were now being held in Al Awar Central prison, where they were allowed non-contact visits once a week, Mr Amad said.
The defence was looking forward to presenting its evidence and believed the case against the pair should be dismissed, he said.

Now 13 Aussies arrested in Dubai collapse

From the front page of the Sydney Morning Herald
March 2, 2009

THREE property industry high-flyers, including the senior agent of a company part-owned by James Packer, are among 13 Australians under arrest in Dubai as its supposed property miracle has succumbed to the global financial crisis.

Legal sources in Dubai have confirmed that among those in jail or in effect under house arrest over property-related bribery allegations are:

■ David Brown, architect and the middle eastern head of the Sunland Group, a Queensland development company which is part-owned by Mr Packer. Mr Brown has been interrogated at least eight times and has had his passport confiscated in relation to a bribery investigation.

■ Marcus Lee, until recently a senior executive with the Dubai Government-controlled Nakheel development company. He is a former executive with the local property companies Jones Lang LaSalle and Investa. Mr Lee is in jail, without charge, and is facing investigation over alleged bribery.

■ Mr Lee's Nakheel colleague Matthew Joyce, former managing director of the Dubai Waterfront project, is also in jail without charge over alleged bribery.

Until now, only the arrests of Mr Joyce and an unnamed colleague had been made public.

The three executives are of particular concern to lawyers and the Australian embassy because of the seriousness of the allegations and the uncertainty of their future. United Arab Emirates law allows suspects to be held indefinitely without charge.

It is understood the bribery allegations involve millions of dollars in consultancy payments by Sunland to Nakheel and a third party over a waterfront property purchase. Nakheel is one of four development companies linked to the Dubai Government and its ruler, Sheik Mohammed bin Rashid al-Maktoum.

Mr Lee and Mr Joyce have been held in solitary confinement since January 25. They have been allowed only limited access to lawyers and family.

Mr Joyce's and Mr Lee's Melbourne lawyer, Martin Amad, refused to identify Mr Lee by name or discuss details of the cases. But he said he was anxious for both men as they enter their second month in custody without charge.

"We're concerned for the welfare of the accused in custody where they've been kept in solitary confinement," he said. "Their physical and mental health has deteriorated. We are becoming increasingly frustrated at the time it seems to be taking for the prosecution authorities to investigate the matter."

Commenting on the 13 Australians under arrest in Dubai, a Department of Foreign Affairs and Trade spokesman said: "The United Arab Emirates legal system is different to the Australian legal system. People who are under investigation can be held in detention for long periods of time without bail."

Some fear people are being made scapegoats. "There is a lot of face-saving to be done," said one Melbourne property player well versed in business in Dubai. "The sheik can never be responsible, so somebody else has to be."

Sunland's managing director in Australia, Sahba Abedian, confirmed Mr Brown had been interviewed by police but insisted his company was not "implicated in the investigation".