Dubai regulator fines former Abraaj COO $1.15m

WAM

Waqar Siddique, former chief operating officer of collapsed private equity firm Abraaj Group, has been fined $1.15 million by the Dubai Financial Services Authority (DFSA) for his “knowing involvement” in the firm’s misconduct.

Dubai-based Abraaj was the largest buyout fund in the Middle East and North Africa until it collapsed in 2018 after investors raised concerns about the management of its $1 billion healthcare fund.

The DFSA said Siddique was also “prohibited and restricted from performing any function in or from the DIFC”, Dubai’s financial centre.

The regulator said Siddique was “knowingly involved in certain Abraaj Investment Management Limited and Abraaj Capital Limited breaches”.

Reuters could not immediately reach Siddique for comment.

The breaches included being “knowingly involved” in Abraaj Investment Management Limited misleading and deceiving investors over the use of their finances within funds managed by Abraaj.

This included “being a signatory to loan agreements used to produce misleading bank balance confirmations and misleading financial statements”, the DFSA said.

On October 14 Siddique withdrew a referral he had made for the Financial Markets Tribunal, an independent appeal body, to review the DFSA’s findings. It said it reached a settlement with Siddique, including “arrangements to secure payment to the DFSA”.

Earlier this month, the DFSA provisionally fined KPMG and its former audit principal $2 million over failings in auditing Abraaj.

It said then, in its view, had KPMG performed its audit to the expected standard, it is likely that it would have identified that, for more than five years, Abraaj’s statements did not conform to accounting rules, it had failed to maintain adequate capital resources and was concealing the true state of its finances from its auditor.

DFSA chief executive Ian Johnston said: “It continues to be a priority to hold senior individuals to account. As with the former Abraaj CFO, Mr Ashish Dave, we have pursued payment of the fine, even though Siddique and his assets are no longer in the UAE.”

DFSA fined Dave $1.7 million in July last year, citing his involvement in deception, unauthorised activity and compliance breaches at Abraaj.