The three brothers at the head of the Damas Jewellery business were fined more than Dh 11 million and required to repay Dh 365 million in cash and almost two tons of gold, and banned from running any company in Dubai for up to 10 years.
The verdict follows a five month investigation into Damas by the Dubai Financial Services Authority (DFSA). Its report revealed that Tawhid Abdullah, the former Damas chief executive, borrowed almost two tons of gold from the companys vaults. The gold, which has not yet been returned, was used to make certain personal investments, the DFSA said.
The regulator found that Tawfique, Tawhid and Tamjid Abdullah used Damas bank accounts as a cash reserve from which withdrawals were made for their personal use. About 2,200 debit transactions were recorded between July 2008 and October last year, covering items ranging from petrol for the brothers cars to multimillion dollar property investments. There was no limit to the amount that the brothers could withdraw from the Damas bank accounts.
Damas as a company was fined Dh 2,569,000 of which Dh 367,000 is due within a month and the rest suspended. The three brothers were fined Dh 11,010,000 for violating DFSA regulations and are required to pay Dh 1,101,000 within 180 days, with the rest suspended pending their cooperation with the authorities recommendations.
In a statement Damas assured shareholders and employees that it was focused on long-term stability and growth.
Conducts of Abdullah brothers have criminal nature
Damas International has recently announced in a statement that the three Abdullah brothers have pledged to fully repay the value of transactions carried out by its former CEO and managing director Tawhid Abdullah.
The statement said the Abdullah brothers have signed a formal settlement agreement with the company in which they have committed to repay in full and in cash the full value of transactions under review.
However, according to local media sources Dubai Financial Services Authority (DFSA) has referred some of the cases it is ?investigating against the Abdullah brothers major shareholders of the Damas Group, to the Dubai Police ?because they may be criminal in nature.?
?Stephen Glynn ?Director and Head of Enforcement, DFSA, told Emirates Business the DFSA has an obligation under the federal law to refer all conduct that it believes is ?of a criminal nature to the Dubai Police. And we have done that
The 3 Brothers banned from running any company in Dubai for the coming 10 years.
The Damas brothers were heavily involved in other non Jewellery activities, such as real estate investments among many other. The recent drop in the economy and the recent drop in Dubai real estate sector has caused the already stubble company in drying of its financial resources.
According to sources, Damas failed to move from a family management style to adopt a corporate company style management.
Damas began its goldsmith operations in Syria in 1907, when it was founded by the grandfather of the Abdullah brothers, and its first branch opened in Dubai in 1959.
According to the company’s website, it now has around 450 stores in 18 countries