Deloitte had warned prior to June 2018 that there are "discrepancies".
Regulators around the world are actively investigating the complex global fraud. US, UK, Singapore, Cayman Islands and DIFC regulators are all investigating Abraaj.
Here is our viewpoint from 5 June 2018:
This video from WSJ released just now, 16 Oct 2018, is a MUST watch and you can watch Arif Naqvi lie to everyone for years without blinking an eye including to impressionable graduating students and now to WSJ when the facts and his investors continue to argue (in courts with documentary evidence) that he took away money of investors for his own personal use.
But if you read our blog regularly then you would have known on 16 Aug 2018 itself (2 months in advance) that Abraaj is and will become the world's largest private equity insolvency.
Abraaj Group: Last Days Of An Insolvent Private Equity Giant
Sadly, many companies in Dubai are based on fraud but all is being hidden under the carpet.
Abraaj and Schon are just the tip of the iceberg.
We have been warning of these collapses since 2015 and updated our prediction on 30 July 2018 with respect to Abraaj:
After our warning about unprecedented damage to the reputation of DIFC on 20 July 2018, as soon as 2 Aug 2018, WSJ published for the first time that Dubai's reputation is at stake. Because DIFC regulators had no idea what was happening under their very noses for years in Abraaj.
This is what WSJ said on 2 Aug 2018.
DUBAI—Investors are questioning whether Dubai’s young financial center can police itself as the meltdown of its marquee private-equity firm highlights broader concerns about placing money in the region.
This emirate’s top regulator, the Dubai Financial Services Authority, has been close to silent since allegations emerged that Abraaj Group misused hundreds of millions of dollars in investors’ money, including that of the Bill and Melinda Gates Foundation and the World Bank. It has issued two short statements, seized some laptops from Abraaj, and is in talks with at least one of the firm’s auditors.
Just yesterday, 17 Oct 2018, another major fraud occurred in Dubai and at least one fraudster was arrested because he cheated several Emiratis under the guise of being a “real estate developer”.
Fraud after fraud comes out on a regular basis even for the real estate regulatory authorities in Dubai.
SM Ali of ACI has been arrested.
No one knows how much money in tens of millions (or billions?) from investors (and banks?) has been lost bringing another dark chapter out in the open in Dubai.
Here is the entire article of WSJ just released last night, 16 Oct 2018 about Abraaj:
This is the most alarming and damaging thing in the entire saga of bankrupt Abraaj from the WSJ article.
"As investigators and investors dig further, more details are emerging that reveal the scope of the problems. At least $660 million of investor money was moved without the knowledge of most investors into bank accounts that forensic accountants call the Abraaj treasury, according to documents and people familiar with the situation.
More than $200 million flowed from those accounts to Mr. Naqvi and people close to him, according to company documents and people familiar with the situation."
This is how the "wealthy" people of Dubai and their associates, starting new businesses, flaunt their wealth.
Because it does not belong to them (has been fraudulently obtained) and hence it's very easy to spend amid lot of show off.
On top of all the above, Abraaj has USD 1bn plus in outstanding debts, has to deal with it's own liquidation (plus sale of assets and outstanding payments) and pay off all investors from assets that are completely frozen in dozens of court cases and bank litigation in the murky world of emerging markets (where currencies are falling on a daily basis and are at their lowest in their history in Pakistan, India, Indonesia, South Africa, Turkey etc.)
We have said it before and we will say it again that NO deal in Emerging Markets can occur without bribes, corruption and payment for political influence. To undo such deals is even worse especially when a company is under liquidation.
Abraaj tried to pay off people around the PM of Pakistan in order to conclude the K-Electric deal as well.
All this and much more will come out in the months ahead.
Do remember that Schon Properties (losses in billions of real estate investors moneys) is also linked to Abraaj (since both families are married into each other and probably there is business between the two as well that perhaps prompted Schon assets to be seized by the Govt before further problems arose) and that very interesting story has still not come out in the open. It is unsure whether Schon owners are still in Dubai or not.
KPMG Dubai connection with Abraaj fiasco has also not come out yet.
Be warned, more frauds and defaults are yet to come out in the months ahead in Abraaj as well as across Dubai.
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