Skip to content Skip to Search
Skip navigation

Investment app Sarwa fined by Dubai and Abu Dhabi regulators

Investment app Sarwa had more than 180,000 registered users by the first quarter of 2023 Alamy via Reuters Connect
Investment app Sarwa had more than 180,000 registered users by the first quarter of 2023
  • Fintech to pay $313,500 penalties
  • Had offered stake in its parent
  • Failed to supply approved prospectus

Investment platform Sarwa Digital Wealth has been fined AED1,151,000 ($313,500) by regulators in Dubai and Abu Dhabi for offering shares and securities without an approved prospectus.

The Dubai Financial Services Authority (DFSA) said on Tuesday that it had imposed a penalty of AED701,815 on the fintech. 

On the same day, the Financial Services Regulatory Authority (FSRA) of Abu Dhabi Global Market announced that it had fined the company’s ADGM operation AED449,881.

Sarwa, an app that provides investment management largely based on algorithms, declined to comment when contacted by AGBI. 

The fines were levied after the fintech offered clients an opportunity to invest in its parent company in April and May 2023.

Its first message about the sale was sent to almost 100,000 customers, the DFSA said. About 150 Sarwa users expressed an interest and $2 million in potential investments was collected. 

The company halted the sale after the regulators warned that it could break their rules. All the money was returned to customers. 

The FRSA and DFSA both said Sarwa’s prompt response had led to a reduction in the fine they imposed, as had the involvement of the other regulator.

The Dubai and Abu Dhabi agencies co-ordinated their investigations, they added, conducting joint interviews and sharing evidence.

Abu Dhabi’s FRSA has ordered Sarwa to launch an independent review of its governance.

It previously fined the company AED36,000 for a 2022 breach of its financial reporting rules.

The DFSA statement also pointed out that the company had withheld critical financial information that should have been in an approved prospectus. 

Instead, it provided positive financial metrics that misled potential investors regarding the health and performance of the Dubai and Abu Dhabi operations. 

The platform, which was founded by Mark Chahwan, Jad Sayegh and Nadine Mezher in 2017, had more than 180,000 registered users by the first quarter of 2023.

It announced a net profit margin of 33 percent for the first quarter of 2024. Revenue was up 124 percent on Q4 2023, the company said.

Latest articles

Opec Secretary General Haitham Al Ghais says peak oil 'is not on the horizon'

Upstream oil and gas ‘needs more annual investment’

Annual capital expenditure for exploration and production in the upstream sector of the oil industry needs to increase by 22 percent by 2030 because of growing demand and cost inflation, experts say. A cumulative $4.3 trillion needs to be invested between 2025 and 2030, according to a report by the International Energy Forum (IEF) and […]

Turkey foreign property sales

Foreigners turning back on Turkish real estate

Foreign buyers are increasingly shunning the Turkish property market, wary of high prices, the expensive cost of living and a less welcoming environment for overseas real estate investors. There were only 2,064 residential units sold to foreign buyers in May, 35 percent down on the same month last year, data issued by the state statistics […]

2KEY8G1 Emirates Airline Airbus A380 aircraft landing. Aerial view of Emirates Airlines A380-800 airplane. An Emirates plane coming in to land at LAX; a spokesperson for Emirates said the contraventions were for safety reasons

US fines Emirates for operating in prohibited airspace

Emirates has been fined $1.5 million by the US Transportation Department for operating flights carrying JetBlue Airways’ JBLU.O designator code in prohibited airspace. The transportation department said that between December 2021 and August 2022, Emirates operated a significant number of flights carrying the JetBlue Airways code between the United Arab Emirates and the United States […]

Egypt will use the US funding across a range of sectors including agriculture

US allocates $130m development funding to Egypt

The US has allocated funding of $130 million for a range of developmental projects in Egypt, it was announced on Thursday. In a press release published by the US Embassy in Cairo, ambassador Herro Mustafa Garg said that the money would go towards “advancing Egyptian efforts to achieve a brighter, healthier, and more prosperous future […]