Abraaj Founder Arif Naqvi Fined $135m by Dubai Regulator for “Serious Failings” at Defunct Company

Arif Naqvi, the founder of Abraaj Group, has been fined $135 million by the Dubai Financial Services Authority (DFSA) for “serious failings” at the now-defunct private equity firm. The DFSA’s investigation found that Naqvi had breached a number of regulatory rules and failed to manage conflicts of interest.

Abraaj Group was once one of the largest private equity firms in the Middle East, with investments in healthcare, education, and energy sectors across emerging markets. However, the firm collapsed in 2018 after allegations of mismanagement and misuse of investor funds.

The DFSA’s investigation found that Naqvi had used investor funds for personal expenses, including a luxury yacht and a private jet. The regulator also found that Naqvi had misled investors about the performance of Abraaj’s funds and failed to disclose conflicts of interest.

The fine imposed on Naqvi is one of the largest ever issued by the DFSA and sends a strong message to other financial professionals in the region. The regulator has stated that it will continue to take action against individuals who breach regulatory rules and harm investors.

Naqvi has accepted the fine and has agreed to pay it in full. He has also been banned from working in the financial services industry in the UAE. In a statement, Naqvi expressed regret for his actions and apologized to investors who had been affected by Abraaj’s collapse.

The collapse of Abraaj Group has had a significant impact on the private equity industry in the Middle East. It has led to increased scrutiny of investment firms and a greater focus on transparency and accountability. The case has also highlighted the importance of strong regulatory oversight in protecting investors and maintaining the integrity of financial markets.

In conclusion, the fine imposed on Arif Naqvi by the DFSA is a significant development in the ongoing fallout from the collapse of Abraaj Group. It serves as a warning to other financial professionals that regulatory breaches will not be tolerated and that the consequences of such actions can be severe. The case also highlights the need for greater transparency and accountability in the private equity industry, as well as the importance of strong regulatory oversight to protect investors and maintain the integrity of financial markets.

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