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      Criminal Complaint filed in Germany against Sheikh Maktoum Hasher Maktoum Juma Al Maktoum CEO of Dubai Developer Al Fajer Properties The Dubai Sheikh who mislead and extort a German Couple  Germany – Dubai 2011 A German elderly couple , today 80 + 50 years old who have been Dubai Tourists since a decade, bought in 2005 an apartment at Nakheel´s Dubai Residen […]
    • UAE: Human Rights Blogger, Sorbonne Lecturer Charged With ‘Humiliating' Officials
      source Human Rights Watch www.hrw.org (Beirut) - The United Arab Emirates attorney general should immediately drop all charges against five pro-democracy activists to halt their trial, Human Rights Watch said today. The charges of "humiliating" top officials relate solely to the defendants' peaceful use of speech to criticize the UAE governmen […]
    • Nakheel Dubai Sunland Case
      June 5, 2011After 21 hearings, Chris O'Donnell, the Australian chief executive of Dubai's major developer, Nakheel, came to the defence of his former colleagues Matthew Joyce and Marcus Lee. Mr Joyce and Mr Lee are accused of profiting from the sale of land that had been earmarked for a colossal high-rise development, which was to include the futur […]
    • Dubai Nakheel CEO decided to leave the company
      Dubai June 7, 2011 Nakheel said on Wednesday that its CEO Chris O'Donnell had left the company "after completing his contract terms". O'Donnell, an Australian who joined the developer in 2006, said he had decided to leave Nakheel following five years spent with the company, the statement added. O'Donnell has overseen a traumatic time […]
    • Owner of Dubai Developer Damac Hussain Sajwani files case against Egypt corruption ruling
      Dubai property developer Damac said on Tuesday it had filed an international arbitration case against Egypt over a land dispute and the conviction of its chairman and owner, Hussain Sajwani.A Cairo court last week sentenced Sajwani in his absence to jail and ordered him to pay a $40.5 million fine in connection with his 2006 purchase of land at Egypt's […]
    • Dubai Palm Jumeriah - Investors plan to take legal action
      Investors in Dubai Palm Jumeirah’s Golden Mile complex will this week serve the developer behind the project with a legal ultimatum to hand over their units or issue them with a refund.Up to ten investors in the luxury complex plan to issue Souq Residences with legal notice in a bid to force a resolution to a dispute that has been ongoing for more than a yea […]
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Archive for May, 2009

Dubai – Forbes – Al Fajer Properties Scandal – Battle over the Books – Behind the $870 million ”rescue” of a royal developer

Posted by 7starsdubai on May 31, 2009

original published Forbes

March 08. 2009 12:36AM UAE / March 8. 2009 8:36PM GMT

zadehmaktoumjbcOn Feb. 3, Al-Fajer Properties, a high-profile real estate development firm owned by the brother in law of Dubai’s ruling sheik, announced a 3.2 billion dirham ($871.2 million) restructuring of its operations. Under the leadership of its new president, Sheikh Maktoum bin Hasher al-Maktoum–the eldest son of the company’s owner, and nephew of Dubai’s ruling sheik–the company explained it had liquidated its land bank and sold off its remaining inventory after a “rigorous” business review in order to strengthen its balance sheet.

But sources close to Al-Fajer tell Forbes that the restructuring was actually a wholesale “rescue” from financial ruin as an independent entity, after nearly three years of alleged mismanagement under former manager Shahram Abdullah Zadeh, a flamboyant, Iranian-born businessman who was fired last year and who claims to still be owed at least $1.9 billion by Al-Fajer.

Forbes has consulted documents–including bank statements, company contracts and employee interviews drafted by an auditing firm, which was called in to help conduct the business review last year–that purportedly tell the story of how Zadeh allegedly forged company contracts, kept fraudulent, unaudited accounts and moved money back and forth between Al-Fajer Properties and other companies owned by him.

Sources close to Al-Fajer say the new president, Maktoum, was called in by his father to fix the so-called “financial shambles” after an employee indirectly alerted the elder sheik to the company’s financial situation by requesting cash in early 2008. Documents show a cash balance of approximately $8.2 million when Maktoum arrived, which was restored to $163.4 million to $190 million 60 days later.

The sheik, say sources close to the company, did this by unwinding investments that would have saddled Al-Fajer with massive liabilities–in the “hundreds of millions” of dirhams–narrowly escaping the real estate slide that hit Dubai months later after the collapse of U.S. investment bank Lehman Brothers in September. Since then, property prices have fallen an estimated 20% to 25%.

Al-Fajer’s cash balance as of February 2009 was not made available to Forbes, but sources close to the company hint that nearly all of it has been plowed back into construction projects.

Zadeh flatly denies any wrongdoing and claims that the so-called “rescue” was a full-blown theft of a company he had owned and financed alone throughout the course of its existence. Moreover, he denies that the company was a financial mess and claims that his erstwhile partner, Maktoum, breached his trust to take control of a successful firm.

“I was the sole investor, and Al-Fajer Properties was my company,” he says. “Sheik Hasher Maktoum has not invested a single dirham into the company; his only contribution has been the real estate license.”

The payment for this license, which cost $82,000, sat in a bank account from the company’s inception in 2004 and was not used as operational capital, Zadeh says.

Zadeh claims that Maktoum, his father and others together “cooked the books” and took control of Al-Fajer Properties while he was detained in jail by the authorities, without being charged, between February and April 2008. After being blindfolded, tortured and interrogated for weeks about unfounded bribery allegations and his operations at Al-Fajer in detail, Zadeh says he emerged from jail only to find a letter demanding he cease all involvement with the company.

Zadeh says he believes his detention was the result of a false report. Sources close to Al-Fajer say that any such claims did not come from them.

The battle has already spilled into the courts, a potentially embarrassing development for a company linked to Dubai’s ruling family. After filing two unsuccessful criminal complaints against Al-Fajer last year, Zadeh said his lawyers filed a civil lawsuit against the company on Feb. 26 at the Dubai Courts, claiming he was still owed $1.9 billion.

Although Al-Fajer Properties is said to have filed a criminal complaint against Zadeh in late February, alleging fraud and embezzlement of funds, the company’s lawyer would not confirm this. “I am aware of no suits against me,” Zadeh says.

Zadeh does not deny moving funds between Al-Fajer and other companies he owns, but claims that he put the money into the company’s account in the first place and later took it back as his “investment.” He said that no money was missing, though he admitted there had been no auditing of the company accounts because the firm was understaffed and had big ambitions.

Sources close to Al-Fajer also confirm that no money appeared to be missing; Zadeh is said to have made up the balance of withdrawn funds with later payments back into the firm.

The corporate tussle casts no direct shadow on the reputation of Dubai’s ruling family, even though Al-Fajer’s operators are one degree removed from Sheik Mohammed bin Rashid al-Maktoum. But it’s another example of the dark side of Dubai, one more blow to its image as a spectacular hub for global investment. After recently being forced to borrow $10 billion from the United Arab Emirates’ central bank in Abu Dhabi to help its enterprises pay short-term debts (see “Dubai’s Jolt Back To Reality”), Dubai is bracing for more bad news as its gross domestic product growth plunges from 8% or so in 2008 to an expected 2.5% this year.

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Clouds over Dubai – Petitions – Demonstrations: Dubai Homeowners go on offensive

Posted by 7starsdubai on May 30, 2009

source TheNational

DUBAI // In an increasingly familiar display of discontent with the property market, two dozen residents of Discovery Gardens gathered yesterday to petition for more transparency and better property management services.

Homeowners in the community pay annual service charges of Dh30 (US$8.17) per square foot, among Dubai’s most expensive, but accuse its developer, Nakheel, of not fulfilling its building maintenance and service obligations.

Their complaints include broken door locks, frequently clogged toilets and unstable balconies, and slow repair service. Many also say they have not received apartment title deeds, which verify ownership, despite purchasing their units months ago.

“We want to make it very clear to Nakheel that if they don’t fulfil their agreement as to what is stipulated on their turnaround times for maintenance, then we want our money back,” said Michael Aldendorff, 39, an apartment owner in the 50,000-resident community who helped organise the demonstration.

“Either they serve us the next year for free, and they improve their maintenance substantially, or they give us back the money that we’ve already paid in maintenance fees.”

The group plans to get 400 signatures for two petitions to be delivered to senior officials at Nakheel and Tamweel, the country’s largest home lender by volume which has financed purchases at Discovery Gardens.

In the other petition, homeowners are demanding breakdowns of Dh32,000 in fees that have been added to their expenses but not clearly explained by Tamweel.

“Till now, I really don’t know which fees are for what – there’s absolutely no transparency,” said Doaa al Ghamrawi, 32, an Egyptian who purchased a one-bedroom flat financed through Tamweel.

Officials at Nakheel and Tamweel could not be reached for comment yesterday.

But in an e-mail sent on Thursday, a Nakheel spokeswoman said the responsibility for title deeds was not Nakheel’s but that of the building owner. “Nakheel, however, is assisting building owners in facilitating the registration of the titles with the Dubai Land Department,” she said.

She said the company had reviewed the existing service fee structure “to take advantage of recent reductions in cost of services” and that homeowners could expect a reduction.

Asked about the deficiencies in services alleged by residents, the spokeswoman said: “Nakheel is committed to providing the best possible service to all our customers. We have a 24 hour customer service call centre for residents, and we endeavour to address service requests in a timely manner.”

The spokeswoman, who declined to be named for unspecified reasons, did not give further details about the reductions.

Juergen Schmidhofer, a 41-year-old German flat owner in Discovery Gardens, said his maintenance and cooling fees were unjustifiably high, about Dh2,000 a month, for the quality of service he receives.

“Why don’t they use a normal electrical meter like they do in Germany to determine what you pay?” he said. “That would save us all money and energy.”

Meanwhile, Flo Weisweiler, 28, a German national who rents a one-bedroom flat in International City, said months of complaining by residents had essentially yielded nothing from Nakheel, the community’s developer. “We’re not asking them for miracles here,” he said. “We just want basic maintenance, security, proper paint on our walls.”

Hallways and façades in the 60,000-resident complex were crumbling and besmirched by dirt, he said, while odours from a nearby sewage-treatment plant continued to permeate the area. Municipal and federal rules were also not enforced, evidenced by the scores of labourers moving into studio flats or residents smoking in such communal areas as elevators or hallways.

“We told Nakheel that a lot of people smoke inside buildings, in the elevators, and that they set off alarms,” Mr Weisweiler said.

“We asked them to put up no-smoking signs, but they said they didn’t have a budget for that.”

In Jumeirah Lake Towers (JLT), Paul Vincent wonders why he and other homeowners are asked to pay high maintenance and service fees when basic amenities have yet to be built. Despite trying on several occasions to obtain a breakdown of the Dh25,000 in yearly fees, there has been no response from JLT’s master developer, Dubai Multi Commodities Centre (DMCC).

“You can’t go out in the night-time because there is no street lighting and no sidewalks,” said the 32-year-old Briton. “It’s still a construction site here – no supermarkets, no shops – you’re basically confined to your apartment.”

“We really don’t know what we’re paying for, so what we want to know is where this money is going, bearing in mind that we already pay electric and water separately. The only formal channels we have to communicate with officials in the development is what’s indicated on DMCC’s website.”

But Bryan Wilson, the executive director for property management at DMCC, said the company “had been completely transparent with all our fees.”

Some developers have launched programmes recently to improve customers service. Deyaar, which expects to deliver 3.6 million square feet of finished units in 2009, has introduced a newsletter for property owners and made its website more user friendly.

Still, many residents appear unappeased.

Softening rents have persuaded growing numbers to relocate to higher-end communities with better reputations in residential management. Others are pursuing a collective-bargaining approach, such as the Jumeirah Beach Residence homeowners group. They and other grassroots groups have banded together to call for transparency from authorities and more say over community management decisions.

Authorities have also sought to more thoroughly intervene in the ailing real-estate sector, most notably with the increasingly active role of Dubai Real Estate Regulatory Agency, or Rera. But falling property values and expected population declines, by as much as 17 per cent in Dubai this year, according to a March EFG-Hermes report, may require bolder intervention.

“My feeling is, looking forward, the Government is going to have to step in and take a bigger regulatory role in this market, because it has become uneven between different parts of Dubai,” said Hafed al Ghwell, the director of external affairs at the Dubai School of Government.

This may mean a painful but necessary break with Dubai’s long-standing preference for managing communities from a hands-off, private-sector-led approach, he said, mainly because “the private sector doesn’t run these things for any larger goals than making profit.”

“If you’re running your own company, you’re not really worried so much about the public good,” he said.

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RERA Dubai freezes developer escrow accounts

Posted by 7starsdubai on May 27, 2009

source TheNational

May 28. 2009

The Dubai Real Estate Regulatory Authority (RERA) has frozen the escrow accounts of some property developers as it awaits assurances that construction is progressing and that all homes sold have been registered with the Dubai Land Department.

This is the latest measure by the authority to safeguard the interests of property investors as the market grapples with a shortage of lending and declining property prices.

Marwan bin Ghalita, the chief executive of RERA, said some developers needed to provide technical reports to the authority’s trust account department detailing the progress of construction before they can withdraw money from the accounts.

“There can be no withdrawal until they have completed the technical report,” he said.

“Payment needs to be linked to construction progress. They also need to prove to RERA that they have registered investors rights with the Land Department.”

Mr bin Ghalita would not say how many accounts had been frozen. RERA introduced the escrow account law in February last year.

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Dubai: Petitions over Petitions – and no Response – The sheikhdom`collapsing property market

Posted by 7starsdubai on May 27, 2009

source MaktoobBusiness

British government is being asked to help UK investors in Dubai who fear losing millions of dollars in the sheikdom’s collapsing property market.

A group of investors based in the UK have sent a petition to Prime Minister Gordon Brown asking him to intervene in what they claim are “harmful real estate practices” in the United Arab Emirates.

“We as investors have recently discovered the blatant embezzlement of our money by unscrupulous developers,” the petition, seen by newswire Zawya Dow Jones, says. The petition was referred by Downing Street to the Foreign Office.

“We have been contacted by individual investors,” a spokesperson for the UK Foreign and Commonwealth Office told Zawya Dow Jones. “The FCO takes this matter seriously.”

A near 50 percent fall in real estate prices in some parts of Dubai has spurred a rash of increasingly ugly real estate disputes between developers and investors. The industry accounts for 30 percent of the emirate’s economy.

The Dubai Land Department estimates that British investors own property worth 4.7 billion dirhams ($1.3 billion) in the emirate. British buyers now account for 12 percent of international property investors in the emirate, behind Saudis and Indian buyers, according to regional investment bank EFG-Hermes.

The involvement of the British government on behalf of disgruntled property buyers will further damage the reputation of Dubai as it struggles to clean up its financial image and attract foreign investment that’s vital for its economy.

The Foreign Office spokesperson said that while the British government would advise investors on how to resolve disputes “ultimately this is a legal matter between the interested parties”.

Dubai’s Real Estate Regulatory Agency, the government watchdog, did not respond to written questions from Zawya Dow Jones, but Thursday said it plans to set up new “real-estate communities” to increase transparency. 

British national Nick Jasani is one of a group of investors who is lobbying parliamentary representatives to put pressure on Downing Street to intervene in the rising number of disputes on their behalf.

Jasani, who bought a commercial unit from a developer in Dubai’s Business Bay district for 2 million dirhams in early 2007, is worried because construction at the project hasn’t started, even though he’s already paid 640,000 dirhams or 30 percent of the unit’s value.

He said the Dubai-based developer is still demanding payment installments even though they’re not working on the project.

A letter seen by Zawya Dow Jones and sent by a number of individual investors to Members of Parliament states that “even though projects have no hope of going ahead due to the current financial climate, the money (investors) they have put down may not be refunded.”

As the bottom falls out of Dubai’s once-soaring property market, developers are scrambling to respond. Many are being forced to cancel or delay projects amid falling sales and property prices.

Last month, a report by investment bank Morgan Stanley said the United Arab Emirates is delaying or canceling real-estate projects worth more than $260 billion. An earlier HSBC report said Dubai is delaying or canceling almost 60 projects worth $75 billion.

Amid growing uncertainty about whether they’ll see their money again, investors are organising themselves to take on the emirate’s sometimes unscrupulous developers and convoluted real estate regulations.

This week a group of more than 100 investors delivered a petition signed by more than 350 investors to Dubai developer Nakheel’s office urging the firm to reschedule payment plans for villas on Palm Jebel Ali because of delays.

This followed a petition to Emaar Properties, the Middle East’s largest developer, requesting the cancellation of three of its projects.

Nakheel did not respond to questions from Zawya Dow Jones.

“There are certainly a number of investors who seem to have claims with merit. Others simply have been caught out by a falling market and insufficient contractual protection,” said Matthew Hooton, head of real estate in the Middle East for law firm Ashurst.

Posted in Dubai | Tagged: | Comments Off on Dubai: Petitions over Petitions – and no Response – The sheikhdom`collapsing property market

Al Fajer Properties – Comment of the Day

Posted by 7starsdubai on May 26, 2009

To 7Stars from Court Expert May 26. 2009

1. Under UAE Law, Article 69, the presiding Judge MUST appoint an expert/auditor to look into the historical records of the company from the first day of establishment. The expert will rely on evidence and facts only. It is a very simple task. Any party who is afraid of the truth will try to block the court from appointing an expert auditor to examine the company account.

2. In this case, where the Iranianian Plaintiff had been detained illegaly for a period of 60 days without any charges, and in violations of a series of UAE Laws his rights have been deprived by the authorities, which indicate the facilitating the take over of the company by the sheikhs raises serious questions about the involvement of the various authorities as potential partners in crime.

3. The current false claims filed by the sheikhs in police are a tactic used to mislead the public/ court and to try to pressure the judge to close the lawsuit against the sheikhs. Although sometimes these tactics work, but normally it can backfire especialy if the other party can provide evidence that it is a false case. Which will result in a criminal prosecution of the sheikhs for creating false cases.

4. In my 25 years experience of complaex financial cases where I have been appointed as an expert , I can give my personal view that if FOR ANY REASON the judge does not appoint an auditor expert with a crystal clear mandate to look into the company records and determine who has invested capital in the company and what is the contribution (IF ANY) of the sheikhs, and hence determine who is the true owner of the company. Then I can conclude that the sheikhs have used their influence to close the case.


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Al Fajer Properties Sheikh plans counter claim

Posted by 7starsdubai on May 25, 2009

source Zawya (AFP)

DUBAI, May 25, 2009 (AFP) – A Dubai sheikh being sued by an Iranian businessman over 1.9 billion dollars in property investments plans to file a counterclaim demanding compensation for losses, his lawyer said on Monday.

Shahram Abdullah Zadeh, the former chief executive of Dubai-based developer Al-Fajer Properties, filed the initial lawsuit against the firm and  Sheikh Hasher Maktoum bin Jumaa al-Maktoum, in February, claiming he was the sole investor and real owner of the company.

“We have requested time to file a counterclaim to demand compensation from Shahram Zadeh,” lawyer Samir Jaafar told AFP following a fourth hearing in the case on Monday.

Zadeh accused the defence of “running away from responding to the lawsuit” against Sheikh Hasher, a brother-in-law of Dubai ruler Sheikh Mohammed bin Rashid al-Maktoum.

He said Sheikh Hasher was registered as owning Al-Fajer PropertiesAl-Fajer Properties
Al Fajer Properties, because being a foreigner he could not register it under his own name.

He told AFP his defence had requested the appointment of an auditor to trace capital inflows into the company, and said despite claims that he was just an employee he never took a salary or had an employment contract.

“He was supposed to earn a share of profits made under his management. But the company did not make any profits,” Jaafar responded.

Al-Fajer Properties, which since February 2009 has been run by Sheikh Hasher’s son, Sheikh Maktoum, filed two complaints with Dubai police in February and March, accusing Zadeh of embezzling 114 million dirhams (31.06 million dollars).

A representative of Zadeh’s lawyer, Salim al-Shaali, called the two claims false and said a complaint about them has been lodged with the public prosecution.

Zadeh is demanding the recovery of all assets of Al-Fajer PropertiesAl-Fajer Properties
Al Fajer Properties, estimated in the lawsuit at seven billion dirhams (1.9 billion dollars).

The judge adjourned Monday’s hearing to June 17.

Posted in Dubai, Jumeirah Business Centre | Tagged: , , , , , , | 2 Comments »

Al Fajer Properties – Dynasty Zarooni – Investors Petition – 500 signatures

Posted by 7starsdubai on May 25, 2009

Al Fajer – Ebony & Ivory – Petition – Ordered to Pay 500 Million

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Dubai and Abu Dhabi: Be careful with cheques, police warn

Posted by 7starsdubai on May 25, 2009

source TheNational 
May 25. 2009

Bank customers in UAE must be careful while writing and signing cheques to avoid penalties that can include jail, according to Abu Dhabi Police.

Speaking yesterday at a banking workshop, Lt Col Abdulwahab al Hosani, head of investigations at the capital police section, said banks often make customers sign blank cheques when they apply for loans in a bid to speed up applications.

“Some people are in a hurry to get the loan to buy a car or property, so they sign without even knowing the conditions”, said Lt Col al Hosani. “Some banks would then issue monthly cheques for that person, which he or she cannot pay, and result in a number of bouncing cheques. A person could go to jail because of bounced cheques.”

Ismail al Bloushi, a senior official at the UAE Central Bank, said there were fewer returned cheques this year. When the economy was booming people used cheques more.

In the past four months, out of 9,742,073 cheques issued, almost six per cent were returned, less than last year, police say.

The bank will try to resolve the issue if a cheque bounces, and refer it to police if they fail. The police may also try to find a solution before going to court.

The Central Bank closes accounts with more than four returned cheques a year, and keeps a blacklist of customers with a history of bouncing cheques.

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Britons face losing savings as Dubai property market collapses

Posted by 7starsdubai on May 23, 2009

source Telegraph UK  23 May, 2009

Britons who invested hundreds of thousands of pounds in unbuilt property during Dubai’s boom years face losing the money after a collapse in the market.

An 800-strong group of investors, from individuals who put deposits on holiday flats to property brokers, says hundreds of millions of pounds is at risk.

Work has slowed or stopped on swathes of building sites, including on a second “Palm Island”. The city was planning a series of artificial peninsulas in the shape of palm trees packed with seafront holiday villas, but only one is finished. 

Of all the world’s property crashes, Dubai’s has been among the most spectacular. According to an estimate from Morgan Stanley, projects worth £165 billion have been delayed or cancelled across the United Arab Emirates. Prices in Dubai have fallen by more than 40 per cent since September.

As prices soared, many investors bought off-plan, either because it was cheaper, in the case of small-time buyers looking for a home in the sun, or because they could “flip” or sell on for a quick profit without ever having to pay the full value.

Investors on the end of a chain of “flippers” have been hit particularly hard as prices fell while building was put on hold. But even those who bought from developers now face the dilemma of whether to keep paying or cut their losses.

The situation has been made worse by local authorities which are revising rules on repaying money for property bought “off-plan” which could mean investors cannot get their full investment back.

Adam Tordoff, a self-employed businessman from Sheffield, has already used his life savings to pay £150,000 towards a £500,000 villa and is facing demands for further instalments even though it has not been built.

“We just want to get our money back and get out of it,” he said. “The next best thing would be to have something actually built rather than the money going into thin air.”

Nick Jasani, from St Albans, bought two shops off-plan as an investment, paying a deposit of £100,000. He believes there is little chance of them being built but the project has not been cancelled enabling him to reclaim his money.

“I am totally fed up,” he said. He has written to the British government asking it to intervene.

The Dubai Real Estate Regulatory Authority has drafted new rules under which investors who pull out of contracts are refunded on a sliding scale, depending on how much has been built. But developers are still entitled to 30 per cent of the money paid even if nothing has been built at all, giving them an incentive to claim projects are still viable.

Nigel Knight, a spokesman for the investors’ group, said its members had bought property valued at around £1 billion, of which almost a fifth had already been paid over.

RERA is preparing further revisions. It may also order 27 projects to be cancelled with full refunds – if the money is left.

In some cases, deposits were used to buy the land, a practice now banned, while Mr Knight alleges some developers were using money paid down for one development to buy land for new projects.

RERA did not reply to questions but Alexis Waller, a lawyer at the Dubai offices of legal firm Clyde and Co, said it was trying to strike a balance between developers and purchasers.

She said many investors signed contracts which did not specify what would be built when. By law developers have to start work within six months of registering projects, but many investors signed contracts obliging them to keep up instalments even if developers failed to do so.

“Investors signed up to payment schedules that were in no way linked to milestones,” she said. “That’s how the market worked here, and purchasers didn’t query it because they were making so much money from property. It’s become an issue because they are no longer making money.”

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Al Fajer Properties – Dynasty Zarooni – Ebony Ivory case – Dubai Court grants bail to Kabir Mulchandani

Posted by 7starsdubai on May 22, 2009

source GulfNews May 21, 2009

Dubai: Dubai Public Prosecution has granted bail to a senior executive of a real estate company who is being interrogated over alleged financial irregularities, Gulf News has learnt.

“The Dubai Public Prosecution granted bail to Dynasty Zarooni Real Estate’s Chairman Kabir Mulchandani. yesterday, but the interrogation continues over his alleged fraud and swindling charges,” a senior public prosecutor told Gulf News on Thursday.

Lawyer Eisa Bin Haider confirmed that his client was released on bail on Thursday.

The Case Dynasty Zarooni – Al Fajer Properties
Jumeirah Business Centre 7,8,9 –
Ebony Ivory Towers – Jumeirah Lake Towers

The Public Prosecution has been questioning Kabir Mulchandani., an Indian, and the firm’s president, an Emirati national, Hilal Al Zarooni, over alleged fraudulent charges.

Salem Al Sha’ali, the legal representative of investors who were reportedly swindled, said earlier some of his clients lodged nearly 30 complaints worth millions of dirhams against the suspects.

More about this case Dynasty Zarooni Al Fajer Properties ( Jumeirah Business Centre – complaining investors) from the past

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Dubai courts are suddenly finding themselve flooded with cases

Posted by 7starsdubai on May 22, 2009

source KippReport

Thanks to the credit crunch the number of trade disputes at the Dubai Chamber of Commerce and Industry (DCCI) doubled in April 2009, reports The National. And the Dubai International Arbitration Centre (DIAC) received 40 trade dispute cases last month, compared with 20 a month earlier, taking the total number of cases in the first four months of the year to 80.

According to the DCCI, there were only 28 arbitration cases in the whole of 2008.

The DCCI legal services department received 156 cases of business mediation in April 2009, and 322 cases in the first four months of this year as compared to 182 cases for the same period last year, an increase of 80 percent.

The DIFC (Dubai International Finance Centre)-LCIA (London Court of International Arbitration), a joint arbitration centre formed in 2008, has also reported seeing an increase in the number of arbitrations in 2009. It has confirmed that it is increasing the number of case handlers to deal with the increasing caseload.

But it’s not just the arbitration courts which are being inundated; 520 cases have also been registered with Dubai’s Property Court this year. Chief Judge Mohammed Yousuf Sulaiman, deputy director of Dubai Courts, told Emirates Business last week that the court has already passed judgment on 145 property-related cases.

The Dubai Property Court was set up in September 2008, and will be getting a mediation centre soon. According to Sulaiman this will reduce the number of cases going to court. “In the mediation centre, there will be a panel of real estate experts who will screen cases and try and resolve them before they are passed to the court,” he said.

According to a recent report from Norton Rose, an international legal group, over 1,000 disputes have also been lodged with Dubai’s Real Estate Regulatory Agency (Rera) in relation to delayed or cancelled projects, and the centre reportedly resolved 95 cases during March 2009.

And it seems the number of cases is set to rise further.

The report says that in the past, contractors and consultants were reluctant to take action against developers in the region for two reasons. Firstly, the major developers in Dubai had a large number of significant projects on their books in which contractors were keen to remain or become involved. And secondly, many large developers are wholly or partially state-owned, and there was a perception that taking action against them might limit a company’s future business opportunities in the region.

But now, following numerous project cancellations and suspensions, cash-strapped sub-contractors are being forced to take action against main contractors in an effort to recover outstanding sums.

And, with investors and developers both defaulting on agreements, going to court seems like the only way to resolve the differences.

The rising number of legal cases will prove to be an acid test for Dubai’s legal institutions and frameworks, says Norton Rose, particularly with regards to the speed and efficiency of the dispute resolution processes, and in respect of the “effectiveness and enforceability of the judgments or arbitral awards obtained as a result of those processes.”

Will Dubai be able to pass the test?

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Middle East’s rich and powerful may not be beyond the law any more

Posted by 7starsdubai on May 21, 2009

source Times UK May 22, 2009

When a crime is committed in the Middle East and nobody is punished, invariably the explanation is that the rich and powerful have proved once again that they are beyond the reach of the law.

For years the shady activities of Gulf sheikhs, powerful ministers and rich businessmen have been swept under the carpet. But something profound could be changing in the Arab world.

Thanks in part to the advance of technology, satellite news channels and internet blogs, the elite are no longer shielded from public scrutiny. Now they may also have to answer to the law.

First was the case of Sheikh Issa bin Zayed al-Nahyan, a brother of the President of the United Arab Emirates, who was filmed apparently torturing a business associate. The footage was smuggled out of the country and aired on television last month. The incident caused a diplomatic spat with Washington and the sheikh was detained while the authorities investigated.

Now we have the case in Egypt of Hisham Moustafa, a businessman and member of Cairo’s elite being sentenced to death for ordering the murder of Suzanne Tamim.

The actions could give renewed hope to others seeking justice in the region, like the family of Martine Vik Magnussen, the Norwegian student who was murdered in London last year. Police want to question Farouk Abdulhak, the son of an Arab billionaire, who left Britain soon after the murder in Mayfair and is now in Yemen.

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Questions and Answers with the Dubai Land Department

Posted by 7starsdubai on May 21, 2009

Source Zawya

There has been considerable debate in the real estate sector following the issuance of Law No 9 of 2009 amending Article 11 of Law No 13 of 2008 on the Interim Register in the Emirate of Dubai . This law concerns specifically the issue of termination of sale and purchase agreements (SPAs) for off-plan units and the damages payable.

Mohammed Kamal, Head of Real Estate-Middle East at Lovells’ Dubai office, recently met with Emad Farouq, Senior Legal Counsel at the Dubai Land Department (DLD)
and Real Estate Regulatory Authority (RERA).

Below is a summary of the question and answer session with Emad Farouq.

Law No 9 of 2009 is now in force. Can you please explain the main implications of this law and how it affects the termination of SPAs for the sale of off-plan units?
This law seeks to impose a new regime for the termination and payment of damages for SPAs for the sale of off-plan units which will apply retrospectively to all prior SPAs. It will amend the provisions of Article 11 of Law 13 which previously stated that upon termination the maximum damages payable to a developer would be 30% of monies paid to date.

The law will also override the administrative circular which was issued by the DLD
in 2008.

Under Law 9, the developer will be entitled to damages strictly according to the progress of construction for the project regardless of what has been agreed in the SPA. There are 5 categories of damages ranging from no damages (i.e. developer will refund all monies received), in cases where RERA cancels the developer’s project, to entitlement to retain all monies received and recover any shortfall if the developer has completed 80% or more of the construction. The intention behind the law is to create a balanced and fair mechanism for the termination of SPAs and assessment of damages. The vast majority of SPAs and arrangements in the market are either vague or unfair, or both. Therefore it was absolutely essential to intervene to provide certainty in the real estate sector going forward.

Can you explain the developer’s obligations under Law No.9?

Generally the developer is obliged to issue notices for termination of SPAs through the DLD
will assess the merits of the case and then decide on whether the developer is justified in terminating the SPA and will also assess the status of construction of the project in order to identify which category of damages will apply.
It is important to note that although a developer may be entitled to resell a unit, it must account to the purchaser for any surplus monies it receives once it has received any damages it is entitled to i.e. the developer cannot be unjustly enriched.

Under Law No 13 of 2008, there is a requirement for all sale and purchase agreements to be registered by 30 October 2008. Has this deadline been extended?

Yes, the deadline has been extended but will be confirmed through the Executive regulations which are being reviewed. Currently, the DLD will allow registration of SPAs after the deadline, provided there is a valid reason for the delay.

What is the Land Department’s view on the recent Property Court judgment concerning the master developer, Mizin?

In this case the Property Court (which is a division of the Dubai Courts) considered an agreement which was not registered on the interim register under Law 13 of 2008 as null and void and ordered Mizin to refund all monies paid by the purchaser. It is clear that the Property Court has taken a literal interpretation of Law 13 and in this case has made a decision which is in favour of the purchaser.

The DLD considers the decision to correspond with our understanding of the interpretation and application of Law 13. In particular, it confirms that if an agreement is not sufficiently registered under the law, then it will be considered null and void and is not enforceable as a binding agreement. Registration is conclusive evidence of rights relating to property, whether they are registered in the real register or the interim register.

Does Law No 9 cover terminations of SPAs for both sales of plots and off-plan units?

Law 9 is intended to cover sales of off-plan units only. SPAs for plots will not fall under the categories for damages under Law 9 and the parties will need to rely on the provisions related to termination and damages under the SPA and, if necessary, issue proceedings in the Property Court to settle any disputes.

Can you confirm what will be covered under the Executive Regulations following Law No 9?

The Executive Regulations under Law 9 are intended to provide guidance on the procedures and practical application of Law 9, amongst other issues. The Regulations will predominantly cover the procedure for termination of SPAs and payment of damages. They will also confirm the rights and obligations of a developer when reselling a unit upon termination and refunding any excess monies to the purchaser. The Regulations will also cover the grounds for cancellation of projects by RERA.
RERA may also request an independent third party expert report to assess the status of construction for a project.

What other laws and regulations can we expect to be issued in the coming months by
Dubai Land Department and RERA? e.g. Strata law regulations
The draft Strata regulations are being considered and will clarify the status of master community declarations, owners’ associations and the management and operation of common property.

We also expect further laws and regulations from DLD/RERA concerning Real Estate Investment Portfolios, Trust Law, Granted Land and Land Development laws and regulations on the restriction on developers collecting no more than 30% of the purchase price before commencement of construction and the requirement for developers to have paid for the land and obtained title and completed 20% construction before it can sell units off-plan.

The future…

Law 9 has been much anticipated by the real estate market and it now paves the way for a swift resolution to property disputes. The Executive Regulations must ensure that a fair balance is created between the rights of the developer and the purchaser and it will be crucial that the Property Court demonstrates consistency in the application of Law 9. Recent reports in the media have indicated that approximately 520 cases have been registered with the Property Court in 2009 and we expect many more to follow. It is expected that the Property Court will also be supplemented with a mediation centre in order to reduce the number of cases.

Lovells will remain at the forefront of new developments in the real estate sector and we aim to provide you with further updates on this topic as more information is available.

About Emad Farouq
Emad is the Senior Legal Counsel at the Dubai Land Department. Previously, he spent 15 years with the UAE Federal Chamber of Commerce and Industry. Emad has played a significant role in the last 5 years in the development of property legislation and regulations in Dubai. In December 2008, Emad was awarded “Best Government In-House Counsel” by the Dubai Corporate Counsel Group.

About Mohammed Kamal
Mohammed is the Head of Real Estate for the Middle East in Lovells’ Dubai office. He has been based in the UAE for several years and has been consistently involved with some of the largest real estate deals and projects in the region. Mohammed is recommended as one of the leading real estate lawyers in the region in Who’s Who Legal.

For further assistance please contact Mohammed Kamal, Head of Real Estate-Middle East.

© Lovells 2009

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ACI – Alternative Capital Dubai Invest Fonds in Trouble

Posted by 7starsdubai on May 21, 2009

source DieWelt Germany May, 20. 2009

Dubai – Vier Dubai-Fonds des Gütersloher Initiators Alternative Capital Invest (ACI) sind offenbar in Schieflage geraten. Die Fonds II bis V könnten vorerst keine Ausschüttungen leisten, berichtet der Branchendienst Fondstelegramm.de unter Bezugnahme auf ein Schreiben der ACI an ihre Anleger. Zwar sei ein Verkauf der Fondsimmobilien vertraglich vereinbart. Jedoch habe der Erwerber entgegen einer früheren Zusage seiner Bank keine Kredite erhalten. Aus unternehmensnahen Kreisen wurden die Informationen der WELT gegenüber bestätigt. ACI-Geschäftsführer Uwe Lohmann war bis Redaktionsschluss nicht für eine Stellungnahme zu erreichen.
Mit einer Investitionssumme von insgesamt 474,5 Mio. Euro ist ACI nach der Marktstudie der Beteiligungsmodelle von Feri EuroRating der größte Anbieter von Dubai-Fonds in Deutschland. Auf ihrer Internetseite beziffert die Gesellschaft ihr Gesamtinvestitionsvolumen im Wüstenstaat sogar mit “über 550 Mio. Euro”.Investoren hatten in den vergangenen Jahren für Milliardenbeträge Bürotürme und Hotels in Dubai errichtet und damit eine gewaltige Spekulationsblase geschaffen, die mit der Finanzkrise platzte. Verbraucherschützer hatten schon im Jahr 2005 vor Engagements im Immobilienmarkt des Öl-Emirats am Persischen Golf gewarnt. rhai


see also:

Mehrere Dubai-Fonds in Schieflage?

Niki Lauda Tower , Boris Becker Tower, Michael Schumacher Tower, Dubai Star Tower and others by ACI Robin Lohmann, Dubai

Posted in Dubai | Tagged: | 3 Comments »

Dubai Court to prosecute former State Minister in Deyaar case

Posted by 7starsdubai on May 21, 2009

source GulfNews Dubai

Dubai: A court is scheduled to prosecute on Sunday a former minister for reportedly abusing his powers as Deyaar’s board director and misappropriating Dh56.6 million, Gulf News has learnt.

The 52-year-old ex-state minister, M.K., has been charged with causing damage to Dubai Islamic Bank (DIB) and Deyaar worth Dh56.6 million and will be tried before the Dubai Court of First Instance.

The Dubai Government holds a 30 per cent stake in DIB; and the bank holds a 45 per cent stake in Deyaar.

Deyaar‘s former chief executive, a 43-year-old American, Z.S., will appear before the same court for allegedly receiving six million Deyaar shares, 380,000 Tamweel shares, 145,000 DIB shares and Dh17.9 million in cash as bribes for giving M.K. discounts and benefits worth Dh56.6 million from Deyaar.

Gulf News obtained a copy of the arraignment sheet in which the Public Prosecution charged M.K. with abusing his authority and unlawfully allowing Z.S. to misappropriate Dh53.5 million from Deyaar and Dubai Islamic Bank.

The Public Prosecution also charged Z.S. with aiding and abetting M.K.

The American has been additionally charged with abusing his authority as CEO and asking Dh500,000 from a businessman for selling property units worth Dh9.6 million.

Deyaar’s former operations manager, a 40-year-old Indian named J.D. who is at large, and Z.S. were jointly charged with accepting Dh20 million from a company for awarding it tenders to execute some Deyaar projects.

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The murder case Suzanne Tamim Dubai – Death sentences for Suzanne Tamim murderers

Posted by 7starsdubai on May 21, 2009

source BBC UK

An Egyptian billionaire and former top political figure has been sentenced to death in Cairo for the 2008 murder of Lebanese pop star Suzanne Tamim.

Hisham Talaat Moustafa was found guilty of paying $2m to an ex-policeman to kill the singer. The killer Muhsin Sukkari was also sentenced to hang.

Ms Tamim reportedly broke off a secret love affair with Moustafa months before she was stabbed to death in her Appartment Dubai Jumeirah Beach Residence

The tale of sex, politics, money and show business gripped the Arab world.

The courtroom descended into chaos after the judge read out a short statement and ordered the sentences referred to the religious authorities for confirmation – as is normal in Egypt.

The defendants looked shocked at the verdict and relatives of Hisham Talaat Moustafa jostled with reporters to prevent them photographing his reaction.

Female relatives burst into tears and one of them fainted in the pandemonium.

Lawyer Samir Shishtawi called the verdict “severe”, adding: “I want to assure Talaat Moustafa’s family that this verdict will be overturned by the appeals court”.

Members of the Egyptian elite are often viewed in the country as being above the law, and there was massive public interest in the case.

The Dubai authorities applied such pressure on the Egyptians to bring the case to trial that he was eventually stripped of his parliamentary immunity.

But reporting of the case was banned in Egypt after the opening statements – a ruling which brought sharp criticism from the opposition.

Reporters from Tamim’s home area in the Lebanese capital Beirut said her family was “grateful for the verdict”.

Suzanne Tamim had risen to stardom throughout the Middle East as the winner of a pop idol contest in Lebanon in 1996.

But her career was marred by reports of a troubled private life.

Posted in Dubai | 1 Comment »

Dubai Ruler replace finance chief – Top Dubai official defends decision to replace finance chief

Posted by 7starsdubai on May 20, 2009

source Arabian Business

The surprise dismissal of Nasser Al Sheikh as the emirate’s finance head on Monday triggered questions among some investors about Dubai’s economic future.

“The government is firmly committed to sustainable fiscal policies and to adopt actions that are appropriate for the current circumstances taking into account the scope of the global crisis, meeting Dubai’s financial obligations and future development requirements,” said Mohammed Al Shaibani, aide to Dubai’s ruler, in a statement issued late on Tuesday.

Al Shaibani is director of the office of Sheikh Mohammed bin Rashid Al Maktoum, Ruler of Dubai and vice president and prime minister of the UAE.

Al Shaibani expressed his support for the new finance director, Abdul Rahman Al Saleh, as “the right man to lead the next stage of managing the economic situation”.

Saleh previously held a top position at Dubai’s customs authority and was in charge of the now shelved VAT plan.

The timing of the surprise leadership switch comes just three months after the Dubai government launched a $20bn bond programme, to ease liquidity difficulties at a number ofgovernment-related entities (GREs).

The emirate has said it has outstanding debt of around $80bn.

So far more than 50 percent of a first $10bn tranche of the bond, which was bought up by the UAE Central Bank, has been distributed to GREs, such as the property developer Nakeel. 

The second $10bn tranche is due to be released by the end of the year.

During his brief tenure, Al Sheikh earned a measure of respect from investors as head of the department for his efforts to navigate the difficulties created in the emirate as a result of the global economic crisis.

In his new position, Al Sheikh will serve as an assistant to the director of the ruler’s court for foreign affairs.

He also holds leadership or positions at a number of important Dubai companies. (Reuters)

Posted in Dubai | Tagged: | 1 Comment »

Dissent upsets ruler’s court for Dubai investors

Posted by 7starsdubai on May 19, 2009

source FinancialTimes

“We know the company needs the money – but we need it, too.”

That was the refrain of one investor, summing up the attitude of many, as shareholders staged an unprecedented walkout at the annual general meeting of Dubai’s largest real estate company this month.

Emaar’s AGM has always provided fireworks, even during the good times when property values were rocketing. But with the credit crunch having demolished the real estate market, shareholder after shareholder grabbed the microphone to plead for a dividend payout.

The background to this is simple: Dubai has gone from gilt-laden boom town to debt-ridden globalisation victim in the space of only six months. The AGM offered Dubai’s citizens a rare outlet for public dissent in a country where political parties are outlawed and rallies require government approval.

The meeting, held in a hall usually reserved for trade exhibitions, was a corporate version of the ruler’s court – or diwan – where the emirate’s leader traditionally heard petitions by the clans and families allied to him.

Read the rest of this entry »

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Al Fajer Properties Case Comment of the Day

Posted by 7starsdubai on May 18, 2009

Comment of the day – to Al Fajer Properties by Journalist 2009


Al Fajer Properties: FORCING ( Extort) an investor to sign a document and a unit ( Apartment)which is not existing in the way like describted in the letters of Al Fajer to this purchaser .

This acts happen in January 2008 and have been enforced (  after this email (January 2008, shown below)) again with extortion against the purchaser by Al Fajer Properties under the so called “New Management” in March 2008 ! Al Fajer Properties is holding until today( 2009) the 45 % payment made by the purchaser directly to Nakheel until mid 2006.

Al Fajer Properties terminate the rights of this investor in March 2008, which the purchaser several times rejected until today, than they start to talk again with him, after he didnt agree to a next taken agressive extortion by them, they start again to terminate his rights – this happen in 2008 – 2009 – not under the former CEO Zadeh, this happen in a direct way by Maktoum Hasher Maktoum over an english lawyer.
To force an purcahser who bought an APARTMENT in an RESIDENTIAL TOWER ( PLOT 3) – in which it is cle since a long time by the plans of Al Fajer ( but this was never uncovered to the purchaser) , that this RESEIDENTIAL BUILDING is not RESIDENTIAL – it is 100 % COMMERCIAL – to say it short – to force somebody to agree to a contract in which an object is mentioned which will never exist : How do you call an act like this ?

And using this not agreeing as the reason to terminate the rights of the purchaser – who hold offical confirmations from DMCC in which everything is very clear mentioned  – how do you call this ?

An email from Al Fajer Properties to this victim left from the former Falcon Tower , Plot H3, once  original purchased at Nakheel in 2005, transfered by DMCC in 2006 to Al Fajer Properties with the clear contractual agreement betweeen DMCC and the purchaser, that Al Fajer Proeprties will deliver an APARTENT in A RESIDENTIAL TOWER ( PLOT H3) JLT, like once purchased at NAKHEEL in 2005.  “NOTHING will change to the once original Purchase” ! … Completion 2008, crytsal clear lake view, 100 sqm luxury apartment – once named and launched by Nakheel as Falcon Tower Plot H3 , Jumeirah Lake Towers !!!!!!

Those victims of the Al Fajer game never hold a so called signable Contract in their hands. It was a Draft full of mistakes and blanks, with no floor plan with no attachments about the apartment…. only an inclomplete draft …. on which they forced ( extort)  them to agree and sign by writig them  the following email , early 2008
email: January 2008 ( an email full of lies !!!!!!!)
Dear Mr ……..

Thank you for your email dated 31 January 2008 in relation to the typing error on your statement.  I have pleasure to attach an amended statement for your records which clearly shows your funds have been assigned to your unit on Plot H3.  Please be advised that despite the error showing the name of the tower, you have and will remain in Plot H3, in the same floor, in the same unit, as per the contracts in your possession.

I would also like to apologise for the delay in responding to your email 23rd January 2008, however this was due to the fact that this was incorrectly addressed to sharam@hhfajer.ae, instead of shahram@hhfajer.ae.   For all future email correspondence, we would be grateful if you could please send directly to my email leighjones@alfajerproperties.ae to ensure a prompt response.
Whilst writing, I would like to draw your attention to our email dated 17 January 2007 (copy attached) as we have still not received a response nor the required documentation.  As discussed, we are still awaiting your formal agreement to proceed with the contract for the Apartment in Plot H3 – Unit …, where we had provided an extended deadline for return of 24 January 2008, as these contracts have been in your possession since October 2007.

As a gesture of goodwill, we would like to hereby once again extend the deadline of 5 days from the date of this email (namely Tuesday 5 February 2008).   Unfortunately failure to provide the required documentation and agreement to proceed by this date, will be taken as your decision not to proceed with the purchase, whereby we will organise the immediate refund of your original booking deposit together with the cancellation of your rights in the property.
For the avoidance of doubt, we are continuing to act in good faith by once again extending deadlines, but cannot continue without the signed contracts being returned.

I trust the above answers your queries in detail and I look forward to hearing from you shortly, however in the meantime, please don’t hesitate to contact me directly should you require any further clarification or assistance.

Kindest regards

Leigh Jones Al Fajer Properties

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Al Fajer Properties – Dubai Court Case – Lawyer rubbishes lawsuit against Dubai sheikh

Posted by 7starsdubai on May 18, 2009

source BusinessMaktoob and  Zawya

Dubai Monday, May 04, 2009

The defence lawyer( Samir Jaafar) for a Dubai Sheikh ( Hasher Maktoum bin Juma Al Matoum, brother in law of H.H. Sheikh Mohammed bin Rashid Al Maktoum) being sued by an Iranian businessman over $1.9 billion property investments  on Monday rejected the lawsuit as baseless.

“All his allegations and the sums that he claims to have pumped into the company are unfounded,” lawyer Samir Jaafar told news agency AFP after the third hearing in the case.

Shahram Abdullah Zadeh has filed the $1.9 billion case against Sheikh Hasher Maktoum bin Jumaa Al-Maktoum and the Dubai-based real estate developer Al-Fajer Properties.

Zadeh insists he was the real owner and sole investor in Al-Fajer, which is registered under the name of Sheikh Hasher, a brother-in-law of Dubai’s ruler, Sheikh Mohammad bin Rashid al-Maktoum.

“There are surprises in the documents that we have presented to the court which will turn the case upside down,” Sheikh Hasher’s lawyer Samir Jaafar said, declining to elaborate.

“We believe that the lawsuit will be rejected after the court goes through the documents that we have presented,” Jaafar added.

Legal sources close to the case, asking not to be named, said the defence has charged that the sums which Zadeh says he invested in the company were in fact the “company’s money that he misused to appear as if it was his own”.

Zadeh, for his part, demands the “recovery of all material assets of Al-Fajer Properties“, according to legal documents obtained by AFP.

These include liquid assets and property, which are estimated at 7 billion dirhams ($1.9 billion), and 9 percent interest since the suit was filed.

His lawyer Salim al-Shaali, who asked the judge for time to study the defence document, said that at the next hearing on May 25 he will ask for an auditor to be appointed to look into the company’s accounts.

“The expert would decide who pumped capital into the company and … whether the defendants paid any money,” he told AFP.

Zadeh charges Sheikh Hasher made no investment in Al-Fajer and that he acquired the licence under the sheikh’s name only because Emirati law does not allow non-Gulf citizens to register real estate firms under their own names.

“For every dirham that Sheikh Hasher can show the court he has invested in Al-Fajer Properties, will give him the company and an extra $10 million bonus,” Shahram Zadeh told AFP after the latest hearing, which he did not attend

Shahram Zadeh said he started up the company from scratch, pumping in cash “as and when the company needed”, and that he only withdrew part of his initial investments after the company expanded from property sales.

“The Sheikhs claim I was an employee,” said Zadeh.

“My question to the court is what employee (can be) the sole investor, work for four years with absolute single authority signing billions of dirhams on cheques, contracts … but work without a salary or an employment contract?”

In addition to Sheikh Hasher, Zadeh is suing his daughter, Sheikha Maryam, a partner in the company, and son Sheikh Maktoum bin Hasher Juma Al Maktoum, who was made president of Al-Fajer after Zadeh was sacked in February.

Zadeh said he was detained by Dubai police after he was sacked and then held without charge for 60 days, and that his passport was confiscated and is still being held.

“I still don’t know why I was arrested,” he said.

The case comes as several executives from high-profile Dubai firms are being held on suspicion of embezzlement and as the once-booming regional business and tourism hub struggles to stave off the impact of the global economic crisis.

Dynasty Zarooni

Al Fajer Properties

GulfNews The first report about this case in the local UAE press

Posted in Dubai, Jumeirah Business Centre | Tagged: , , , , , , | 3 Comments »

„Folter geht uns alle an“ – German Press – Torture – Issa bin Zayed al Nahyan

Posted by 7starsdubai on May 18, 2009

source German Press Merkur

Dietramszell , Germany, 18.05.2009

Mit Applaus ist am Sonntag die Predigt von Pfarrer Franz Burgey quittiert worden. Er hatte die Machenschaften von Skeikh Issa bin Zayed Al Nahyan kritisiert.

Die Kirchgänger beklatschten die Stellungnahme des Ortsgeistlichen von Lochen und Linden, der sich ausdrücklich von den Machenschaften von Prinz Issa Bin Zayed al-Nahyan distanziert hatte.

Pfarrer Burgey, emeritierter Professor und Hobby-Historiker, ist bekannt für seine tiefschürfenden Predigten. Gestern nutzte er die Gunst die Stunde, um manchen Stammtischparolen eine klare Absage zu erteilen. Immer wieder wird in Dietramszell argumentiert, der Scheich sei nun Mal aus einem anderen Kulturkreis. Das Sprichwort „andere Länder, andere Sitten“ ist nach Burgeys Worten aber „völlig unzutreffend“. Unter Berufung auf islamische Gelehrte sagte der Ortsgeistliche: „Mord, Blutvergießen und das Stiften von Unheil, Unordnung und Zerstörung gelten als schwere Verbrechen. Niemand hat das Recht, Leben und Eigentum anderer Menschen zu schädigen oder wegzunehmen.“

Selbst wenn Mordversuch und Folter in anderen Ländern erlaubt wären, sagte Burgey, „erwarten wir von einem Mitbürger, der hier in Deutschland unter dem Schutz der deutschen Gesetze lebt, dass er sich auch anderswo entsprechend benimmt, sonst ist er als Nachbar nicht tragbar“. Landesweit sei mit Empörung aufgenommen worden, dass Dietramszeller die Folterungen mit dem Verweis auf die Landessitten in Abu Dhabi gleichmütig hingenommen hätten. „Es geht mir nicht darum, Leute wegen unglücklicher Äußerungen zu schimpfen“, predigte Burgey. Wenn man plötzlich vor der Kamera oder einem Mikrofon stehe „kann leicht etwas Falsches herauskommen“. Er müsse aber richtig stellen: „Es geht uns sehr wohl etwas an, wenn der Scheich in Abu Dhabi foltert.“ Demokratie bestehe wesentlich im Hinsehen, nicht im Wegsehen.

Mesner Johann Mayer begrüßte die Erklärungen von Pfarrer Burgey. „Es ist schwierig für den einfachen Bürger die Sachverhalten zu erfassen und zu verstehen.“ Aus diesem Grund sei die „aufklärende, sachliche Predigt“ des Pfarrers sehr hilfreich gewesen. Die Rede habe „den Horizont erweitert“ – schließlich solle und könne man sich nicht auf das Gerede anderer verlassen. (xb/ee)

ZDF Heute Journal Germany 10.May. 2009 , Report Torture Issa bin Zayed Al Nahyan

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German ZDF Heute Journal May 10, 2009 TV Report about the Torture Video Issa Nahyan

Posted by 7starsdubai on May 18, 2009

ZDF Heute Journal Germany 10.May. 2009 , Report Torture Issa bin Zayed Al Nahyan

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UAE ‘torture’ case seen as critical test of justice

Posted by 7starsdubai on May 16, 2009

source FinancialTimes  May 16.2009 by Andrew England Abu Dhabi  and Simeon Kerr in Dubai

The footage begins with an assault rifle allegedly being fired by a member of the United Arab Emirates’ ruling family. Bullets throw up clouds of sand as they smash into the desert, inches from a cowering Afghan grain trader.

It moves on to the Afghan being beaten with a cattle prod and a plank of wood, and concludes with a 4×4 vehicle being driven over his battered body.

The video lasts just minutes and was recorded more than three years ago. But, for the UAE, an oil-rich nation desperate to hold itself up as a model international business hub, it has thrown up a critical test.

The man alleged to have carried out the assault in the so-called “torture video” is Sheikh Issa bin Zayed Al Nahyan, a half-brother of the UAE’s president and of the ruler of Abu Dhabi, the capital and wealthiest of the seven city states that make up the emirates.

In the past, scandals involving the Gulf’s large ruling families were dealt with in-house and its members were seen to be above the law and almost any form of public scrutiny.

But this time it is different. The video has been leaked, broadcast by American television, posted on the internet and widely distributed to politicians in the US, a key ally with which the UAE is hoping to negotiate a deal on civilian nuclear trade.

In the wake of the international outcry, Abu Dhabi authorities announced that they had detained Sheikh Issa and launched a criminal investigation into the allegations, the first move of its kind in the UAE.

With the world’s eyes increasingly on the oil nations of the Gulf, image-conscious Abu Dhabi appears to have accepted that it had no choice but to act amid the scrutiny.

“The UAE is clear on its desire to be global and be measured by best of international standards,” says Abdulkhaleq Abdulla, a political scientist at Emirates University. “And if it wants to measure itself with the best of international standards, it has to apply it across the board.”

In recent years the UAE has grown more engaged with the outside world and has moved to quell international censure. It has reimbursed child camel jockeys, improved labour rights and worked out principles for sovereign wealth funds to follow.

Dubai expatriates have long passed on stories of foreigners who ended up in jail – the “Hilton Jumeirah”, as some dubbed the city’s old prison – for crossing the wrong sheikh or wellconnected national, usually over a failed business deal.

Lawyers say some individuals can still pervert the course of justice by wielding influence before a trial. But once cases go to court, it is generally more difficult to influence the judiciary.

The decision to prosecute a former finance minister, Mohammed bin Kharbash, for alleged fraud at a state-linked real estate company, seems to back the proclamation last year by Dubai ruler’s that no one is above the law.

Most locals argued that Mr bin Kharbash was too powerful to face trial and the move sent shockwaves through the community. Another former minister had a month earlier been found guilty of embezzling assets from a business partner.

However, there are some foreign complainants in commercial cases who continue to argue that they are not getting a fair hearing.

With the case of Sheikh Issa – one of 19 sons of UAE founding father Sheikh Zayed – many will want to see if the judicial process produces tangible results.

Human Rights Watch argues that, while his detention is significant, “much more needs to be done to restore faith in the country’s police and justice system”.

But Mr Abdulla said it shows that no one – whether it’s “a regular man or superman or a ruling family man” – is above the law.

“We should not be in the habit of hiding our mistakes,” he adds. “The sooner we deal with them in a transparent way, the more we will measure up [as] a transparent and a civilised nation.”

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Jumeirah Beach Residence standoff

Posted by 7starsdubai on May 15, 2009

source: Xpress GulfNews

Dubai : The Real Estate Regulatory Authority (Rera) has taken the sting out of a 129 per cent increase in service charges for unit owners of Jumeirah Beach Residence – sort of.

In a letter obtained by XPRESS, Rera has given what it calls “preliminary approval” that Salwan Property Management rescind its original annual service fee hike of Dh21.75 per square foot to Dh15.32.

The decision means that instead of an owner of a 1,000 square-foot flat in JBR paying Dh21,750 per year, he/she will now pay Dh15,320 per year.

In its letter, Rera tells Salwan that “we have agreed” to the lesser service charge which is split between Dh8.32 per square foot for maintenance and service charges and Dh7 per square foot for electricity and water consumption.

Not enough

Celia Reinaldo, a member of the JBR Residents’ Association, said unit owners are glad, but noted that some owners believe even the latest compromise doesn’t go far enough.

“It’s good news but it’s still more than it was last year,” said Reinaldo. In its letter, Rera has informed Salwan that it “must take into consideration” management fees, a building reserve fund and an infrastructure amount as part of the service fees cost.

The letter said, “Developers must deposit collected charges into private account and undertake not to spend the money unless [they] get Rera approval.”

The JBR Residents’ Association, meanwhile, has hired a professional company which had determined in a initial study that the Dh15.32 per square foot cost is also not justified.

In a letter to members, the association executive said that “based on this initial study, the maximum cost for JBR in terms of service charges should not exceed Dh12.4 per square foot”.

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Dubai Criminal Court – Saudi bank also a victim in Dubai Islamic Bank scam

Posted by 7starsdubai on May 15, 2009

source TheNational UAE
May 14, 2009

DUBAI // A Saudi bank was among the victims of the scam in which the Dubai Islamic Bank was defrauded of US$501 million (Dh1.8bn), it was disclosed in court here yesterday.

A DIB employee testified yesterday before the Dubai Criminal Court of First Instance that $120m of the embezzled money belonged to the Saudi Hollandi Bank, of which DIB was a local agent.

The seven defendants are charged with presenting falsified documents to DIB to take possession of funds to finance non-existent projects. Five of them appeared in court yesterday.

The DIB employee told the court that one of the defendants, CR, had met with a special committee set up by DIB in 2007 to settle the matter out of court and pay back the money owed by CCH International, the British-based financial company into whose account the embezzled funds went. He said CR told the committee that the funds were used for “other purposes than intended” and that the bulk of the $501m was transferred to projects and companies in Pakistan and Bahrain as well as to The Plantation project in Dubai.

He said the bank had approved the settlement initially after numerous meetings with CR, who agreed on a repayment schedule and offered the bank properties in Bahrain and in The Plantation project itself as guarantee but that the payments stopped when the defendants were arrested.

Judge Hamad Abdullatif adjourned the case until May 28.

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Nakheel will pay only 65 percent of its debts

Posted by 7starsdubai on May 14, 2009

source KippReport

May 14, 2009
Dubai-based property developer Nakheel is offering consultants and contractors only 65 percent of what they are due, the New Civil Engineer reports.

“One of the offers on the table is for firms to get 65 percent of their consultancy fees, with the understanding that in doing so, they waive their legal rights [to further payment],” said Nelson Ogunshakin, CEO Association for Consultancy and Engineering.

Nakheel received an undisclosed cash injection from the Dubai government in early May, as part of Dubai’s $20 billion bailout plan.

According to the publication, Nakheel refused to comment on the issue.

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What next is the question now being asked by investors as one of the Middle East’s largest property developers Nakheel

Posted by 7starsdubai on May 13, 2009

source The National UAE, May 12, 2009

ABU DHABI // Nakheel made headlines around the world with its Palm island projects and the planned Hong Kong-sized Waterfront development, while its advertising billboards dotted around Dubai asked “What next?”

What next is the question now being asked by investors as one of the Middle East’s largest property developers contends with a US$3.5 billion (Dh12.85bn) Islamic bond due in December, which helped fund projects that included the world’s biggest man-made islands.

How the sukuk is handled will serve as a key test for the credit ratings of state-controlled companies in the emirate and could affect their ability to raise money on international markets. It is also widely seen as an indicator of how Dubai will cope with its overall debt burden, estimated at $70bn.

“The clock is ticking, so something has to be done,” says Abdul Hussain, the chief executive of Mashreq Capital.

Nakheel issued the three-year sukuk in 2006, when the Dubai property market was still in a fever and the likelihood of a downturn seemed impossibly remote. The bond came with a profit rate – the Sharia-compliant equivalent of an interest rate – of 6.345 per cent per year. To ease its cash flow, however, Nakheel arranged to pay just half of that, or 3.1725 per cent, during the life of the bond. It would pay the rest at maturity, which seemed a sensible strategy given the rapid rise in property prices in Dubai and the healthy profits the company was booking.

As a further teaser, Nakheel added an option for sukuk holders to buy shares of Nakheel at a 5 per cent discount should it stage an initial public offering and become a listed company. It also backed up the sukuk with significant collateral: land and other assets worth more than twice the value of the sukuk.

At first, international investors eagerly snapped up the offering. Initially, just 30 per cent of the shares were sold to investors in the region, according to a source involved in the deal. The rest went to overseas investors.

Almost three years later, the economic climate could hardly be more different and Nakheel, like many other companies in Dubai, is busy working out how to settle its debts amicably while continuing to build and invest. The company recently undertook a round of cost-cutting and is said to be asking its contractors to take discounts on payments due to them. A source at a building contractor in Dubai that has worked on a number of Nakheel projects said all construction companies associated with the company’s Waterfont development had been asked to take discounts ranging between 30 and 40 per cent.

Yet among the many ways in which Nakheel must cope with the changing economic tides, its $3.5bn sukuk probably ranks as the most significant – and most urgent. The uncertainty surrounding the sukuk has caused its price to rise and tumble rapidly. It was recently trading at a heavy discount, with a yield of about 58 per cent. Low prices and high yields mean investors demand to be compensated with a high return for taking an increased risk that their money may not be paid back in full. “The market obviously believes there is a significant risk of some form of restructuring,” Mr Hussain says. “Otherwise you wouldn’t be able to earn a 50 per cent yield. We are now waiting to hear what sorts of strategies are going to be put in place.”

Nakheel has a range of options for the sukuk, analysts say. It may simply pay off investors in full using an injection of funds from the Dubai Government, received as part of the first instalment in a planned $20bn bond programme. Nakheel said recently it was receiving assistance under the programme.

It could also sell part of itself to a private equity firm in order to raise some of the cash. Analysts have suggested that money raised from a possible sale of part of DP World to a private equity firm could be redirected through Dubai World – which owns both DP World and Nakheel – to help pay off the sukuk. Abraaj Capital, a buyout firm managing $6bn in assets, has approached Dubai World about acquiring a “significant minority stake” in DP World, a source with knowledge of the discussions said earlier this week.

Nakheel could also go to banks for loans to refinance part of the sukuk, or it could try to buy back a chunk of the Islamic bond by extending a tender offer to existing owners.

Another option is for Nakheel to partially restructure the sukuk, giving most of investors’ money back and converting the rest of the debt into a new longer-term loan. This route could also involve one or both of Nakheel’s other sukuk, which are smaller and due in 2010 and 2011.

Rumours of such a restructuring began to surface about a month ago, when Nakheel hired a market intelligence firm to identify the owners of its sukuk shares. Many investors saw this as an indication that the company was trying to find out what portion of the sukuk was owned by investors who would be sympathetic to an attempt to restructure.

The possibility of a restructuring led Standard & Poor’s, a major ratings agency, to put numerous Dubai companies on watch for a credit downgrade.

A Nakheel spokeswoman said in a statement that “a number of options” were currently on the table and declined to elaborate. Bankers said that a restructuring that left investors with a loss was probably Nakheel’s least desirable option, aside from a fully fledged default. If Nakheel were to allow many of its investors to take losses, they said, the cost of raising money in the future – for Nakheel and other government-linked companies in the UAE and the broader GCC – might go up.

“Nakheel has a large volume of public debt, much of it held by international investors, so a lot is at stake regarding international credibility of Dubai corporates that will likely at some point seek to borrow again in the global capital markets,” says Khalid Howladar, a vice president and senior credit officer for structured and Islamic finance at Moody’s, another ratings agency.

What seems most likely, investors and observers say, is a combination of some of these options. Nakheel may buy back some of the sukuk shares using subsidy money, for example, offering an above-market price for them. If some investors are unwilling to sell, the company could then try to refinance a portion of the debt with bank loans and sell some of its equity to a private equity firm.

Bobby Sarkar, an analyst at Al Mal Capital in Dubai, believes Nakheel is also considering selling some of its assets, such as its stake in the Atlantis Hotel on the Palm Jumeirah and properties in Discovery Gardens, both in Dubai. “They are looking at a combination of asset sales, some inflow from the Government, some restructuring and a partial sale to Abraaj.”

Whatever options it chooses, a source familiar with the sukuk says, a full default or even a serious restructuring is highly unlikely, given the value of the collateral that Nakheel has provided and the negative message such a move would send to international markets.

Moreover, Dubai’s government-linked companies have so far succeeded in paying off or refinancing large loans and bonds as they come due. In February, for example, Borse Dubai – the company that owns Nasdaq Dubai and the Dubai Financial Market – was able to refinance a $3.4bn bank loan, albeit with major help from local sources of funding.

Last month, the Dubai Electricity and Water Authority refinanced a $2.2bn Islamic loan with 18 international, regional and local banks.

Nasser al Shaikh, the director general of the Dubai Department of Finance, said a week later there was a “shift in the overall mood” in the international credit markets when it came to Dubai’s debt.

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Nakheel confirms receiving funds

Posted by 7starsdubai on May 13, 2009

source Business24/7

Nakheel has started receiving funds from Dubai Government, confirmed its Chief Executive Officer (CEO) Chris O’Donnell in an exclusive interview with Emirates Business. However when asked if the figure stood at Dh2 billion, the chief executive said: “The actual figure is confidential and so are all the other details. But yes, Nakheel is receiving funds.”

The developer is also talking to its contractors and re-negotiating payments plans and contracts. “Yes, we are trying to help them and ourselves through our current situation. We are at the stage of commercial settlements and negotiations. Rather than detail on percentages, it is a true statement to say that construction costs are falling and there is definitely a reduction,” said O’Donnell.

“Part of our obligation to our customers is to ensure that we get them the best buildings. Hence, we are talking to our contractors to get cost-effective solutions.”

O’Donnell said the developer does not issue credit notes and warned investors against any such fraud. “When the market recovers, the focus will be on people buying serviced land. Hence, the built form in Nakheel’s projects is definitely going to be linked to the provisions of infrastructure, which will be on an incremental basis,” he added. Speaking about the latest on the status of Nakheel projects, O’Donnel said that work on Palm Jebel Ali has slowed down while the Palm Deira and the Universe projects are on hold.

However, construction on Jumeirah Village and Al Furjan is progressing, he said.

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Nakheel Jumeirah Palm home prices hit new three-year low – Dubai May 2009

Posted by 7starsdubai on May 13, 2009

source ArabianBusiness

House prices on Nakheel’s Palm Jumeirah project have fallen below AED800 per square foot for the first time in over three years – and nearly 60 percent down in the past five months, Arabian Business can reveal.

Agents are now looking to offload three bedroom apartments covering 2,184 square foot for just AED1.7 million, representing only AED778 per square foot.

And experts suggest even that figure could fall further.

“The 1.7m (dirham) is the listed price, and we all know that nobody is selling for a listed price. There are people who may be willing to take even 1.5million, which would less than 700dhs per square foot,” said one agent.

Other experts suggest that the continued falls are linked to the exchange rate between the pound and dirham.

“With the rate have fallen to around five dirhams to the pound, landlords based in the UK can afford to take nearly 30% less than they were asking based on last year’s rate and still end up with the same amount of sterling in their bank. That factor is definitely pushing the market down more,” said the agent.

The decline in sale prices comes as a new rental index for Dubai to be published this week will show a 30 percent fall in rents since March for Palm Jumeirah villas.

The Landmark Advisory index is expected to show declines in other residential hotspots in Dubai such as apartments in Jumeirah Beach Residence (JBR) and townhouses in the Springs – with rental falls of eight percent compared to Landmark’s last index.

“Since our last price map published at the end of March, we’ve seen a shift towards leasing. Owners are unable to sell their units and they are unwilling to lower their prices. They are adjusting their investment horizons and turning to leasing to generate revenue,” said Jesse Downs, director of research at Landmark Advisory, the consultancy division of Landmark Properties.

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RERA – Dubai mulls cancellation of 27 projects

Posted by 7starsdubai on May 12, 2009

source ArabianBusiness

Dubai is considering cancelling 27 projects, the head of its real estate regulator said on Monday, as the emirate’s property market slumps in the global downturn.

A decision whether to cancel or not would be made by the end of the month, said Marwan bin Ghalita, the head of the Real Estate Regulatory Authority (RERA).

“The decision has not been done. They are projects all over Dubai – third party projects (sub developers),” he said.

Earlier this year, Ghalita said he believed 25 percent of projects will be cancelled in Dubai as a result of the global economic slowdown.

“It’s almost the same,” he said when asked if that figure had changed. The Dubai Land Department and RERA set up a committee last week to cancel projects in the emirate that are not feasible.

Posted in Dubai | Tagged: , , , | 7 Comments »

German economics minister meets UAE interior minister

Posted by 7starsdubai on May 11, 2009


Abu Dhabi

German Economics Minister Karl-Theodor zu Guttenberg said Sunday that the United Arab Emirates government would soon publish the results of an investigation into a torture case in which a member of the emirate’s ruling family has been implicated.

Guttenberg said he was told this in talks with UAE Interior Minister Shaikh Saif Bin Zayed Al Nahyan.

The Berlin minister said that the Emirates’ government had an interest in assuring that the country’s rule of law reputation is not damaged. Guttenberg said he had made a point of bringing the case up for discussion.

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Comment of the Day – RERA Dubai

Posted by 7starsdubai on May 10, 2009

by Joe May 10, 2008

You are not alone there. Probably there are thousands of investors in this moment who invest in off plan property and now balancing on the edge of precipice.

What is very sad that authority doesn’t do their job. They have established RERA and Laws around but RERA does not act in accordance with responsibility that they have. By their passiveness they actually support developers to make with investors what every developer would like. But this is like huge boomerang that will devastatingly  hit entire Dubai project.

I am simply stunned how authority is looking peacefully while full crowded ship sinking in front of their eyes.
By Law No 9 it is evident that RERA would like to help developer rather than helping investors. Where will be our investment place after Law No.9 just God knows.

What will be rules and conditions to cancel project will probably depends on color of skin, distance from Sheikhs, residency, are the owner  of Developer  domestic or stranger etc.

And do you think that investors are asked to participate in panel? Or when composing rules for categorize project to what “Sliding Scale” to place it?

I think that without pressing from outside they will still think that they can do whatever they would like and manipulate with foolish investors as much as they want.

UAE is not alone in the Earth. Their life depends on world community. Without respect to all of us who wanted to participate in Dubai story they do not have future.

One lesson was recently reached UAE by freezing permission for using nuclear power for civil purposes caused by incident from royal family.

I think that there has to be more lessons if outside investors are going to lose their invested money. We have to ask our government to protect our interest in Dubai.

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Dubai Lawyer Samir Jafaar: ‘Ex-UAE Minister of State Had No Intention to Cheat’

Posted by 7starsdubai on May 10, 2009

source KhaleejTimes by Zawya

08 May 2009


The verdict in the fraud case filed against former UAE Minister of State Dr Khalifa Bakhit Al Falasi will be pronounced on May 28 by the Court of Appeals.

Both defence lawyers of the ex-minister, his son and the other two defendants, Samir Jaafar and Abdelmonem Suwaidan, stressed in their arguments that the former minister did not swindle the Lebanese businesswoman (the plaintiff). They pleaded that she was aware of the legal status of both her late brother and Dr Al Falasi before she signed the disputed settlement bond in which she relinquished her 49 per cent shares in the Global Information Technology Company that she inherited from her brother.

“The audit reports and financial and budget statements of the company are some of the evidence that she was aware of the business relationship between the minister and her brother,” Jaafar said. “What sustains our pleas is that my client (the ex-minister) was running the information company in due course when the plaintiff’s brother was in the US for health reasons. Dr Al Falasi signed personal banking security bonds which is a clear revelation of his good intentions,” counsel Jaafar pleaded.

Jaafar added, “In the documents we had access to, there was one particular contract signed by the ex-minister and the plaintiff’s brother saying that the latter collected a monthly salary of Dh2,000. This proves that my client is a real partner in the company.”

Jaafar pointed out that the plaintiff collected Dh28 million for her part of the family shares which does not mean that she was victim of cheating.

The 51-year-old ex-minister pleaded not guilty to the charge of cheating the Lebanese businesswoman to unlawfully take the Global Information Technology Company, she inherited from her brother by pretending he was a partner with 51 per cent of the shares, rather than a paid sponsor.

He pleaded not guilty to the fraud and breach of trust charges. His son, the American director general of the company and the Indian financial manager also pleaded not guilty to the charge of criminal complicity in defrauding the plaintiff.

The Court of Misdemeanours awarded on February 23 the former minister two years in jail, as he was found guilty of fraud. Dr Al Felasi was acquitted of the charge of breach of trust.

Defence lawyer Jaafar also highlighted in his pleas a letter from the Economic Department proving that Dr Al Falasi was the original owner of the company since 1995 and that late brother joined in as a shareholder in 1996.  The former minister’s 26-year-old son was acquitted in February from the criminal complicity charge.

The company’s director general and the financial manager were awarded two years in jail each for assisting in swindling the plaintiff. They would be deported after serving their jail terms, the court ordered. The civil case was referred to the relevant court whereas the plaintiff is claiming Dh500 million in compensation.

The Lebanese woman is also prosecuting the former minister for hiding from her the fact that her late brother was investing in a real estate in Al Qusais area.

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Royal Sheikh Issa Zayed Al Nahyan Detained by UAE Over Torture Tape Allegations

Posted by 7starsdubai on May 8, 2009

source ABC News 08, May 2009

A member of the royal family in the United Arab Emirates, Sheikh Issa bin Zayed al Nahyan, has been “detained” in Abu Dhabi by authorities investigating a chilling videotape that shows him torturing an Afghan grain dealer, according to officials in Washington.

UAE officials told American diplomats the Sheikh was put under “house arrest” this week and prevented from leaving the country as the UAE Ministry of Justice conducts a criminal investigation of the incidents on the videotape, the officials said.

The 45-minute torture tape, first broadcast on ABC News Nightline two weeks ago, shows the Sheikh, the brother of the UAE crown prince, beating his victim with an electric cattle prod and a wooden plank with protruding nails. Men in police uniform are seen on the tape restraining the victim, who has sand shoved down his throat and is later repeatedly run over by a Mercedes Benz SUV driven by the Sheikh.

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Dubai: Construction firms owed billions

Posted by 7starsdubai on May 7, 2009

source The National

Construction firms in Dubai say they are having to either accept reduced payments, or risk not getting paid at all. The National

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‘Egypt’s Madoff’ faces trial in UAE

Posted by 7starsdubai on May 7, 2009

source TheNational

ABU DHABI // Nabil al Boushi, an Egyptian businessman sentenced in absentia to 15 years in jail in his home country after he was convicted of fraud, will have to stand trial in Dubai before any thought can be given to his extradition, the Ministry of Justice said yesterday.

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Four charged with fraud in UAE-Europe VAT case

Posted by 7starsdubai on May 7, 2009

source The National

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RERA Dubai – Panel to identify unviable projects for cancellation

Posted by 7starsdubai on May 7, 2009

source Business24-7

Dubai Thursday, May 07, 2009

The Dubai Land Department and the Real Estate Regulatory Agency (Rera) have set up a committee that will decide on cancellation of “unviable” projects, senior department officials said yesterday.

Addressing an investors’ meeting, officials said a committee has been formed to study and analyse non-feasible projects.

“It is a tedious task and requires a lot of paper work. But the committee has been created to address the issue,” a senior official said.

Ludmila Yamalova, Partner, Mac Davidson Legal Consultants, who was present at the meeting, told Emirates Business that officials admitted project cancellations were not under their purview earlier, but amendments to Law No13 regulating the Interim Real Estate Register in Dubai now allows them to cancel projects that they deem not feasible.

In February, Rera Chief Executive Officer Marwan bin Ghalita said he believes 25 per cent of the projects will be cancelled, as developers did not start them or don’t have an intention to begin. However, he could not be reached for comment on the number of developers requesting cancellation.

The officials further told investors that the detailed regulations for Article 11 of Law No13, which lays down the terms for cancellations of “off plan” properties, will be announced soon and will explain terms such as “beyond developers control” in detail.

According to Yamalova, the authorities said developers will no longer be allowed to retain any money on reselling of units on termination of investors’ contract.

“Developers will no longer have any incentive to cancel contracts, as the money received on the resold unit will have to be deposited with the trust account of the Land Department,” she added.

Besides, Rera is also ensuring all amended payment schedules from developers need to be approved by them, with it planning to upload all payment plans on their website.

According to Rera statistics, 31,003 and 43,880 units will enter the market in 2009 and 2010, respectively.

However, it believes 20 per cent of residential units may not enter the market this year.

In February, it said the number of developers has come down from about 870 to 427.

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Torture-tape Gulf prince accused of 25 other attacks

Posted by 7starsdubai on May 3, 2009

source Guardian UK

New York, Sunday 3 May 2009

US lawyers claim they have videos implicating Abu Dhabi royal in more cases of torture, a week after outcry over his assaults on Afghan businessman.

“I have more than two hours of video footage showing Sheikh Issa’s involvement in the torture of more than 25 people,” wrote Texas-based lawyer Anthony Buzbee in a letter obtained by the Observer.

read the full story Link

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Off plan sales in Dubai ‘practically non-existent’

Posted by 7starsdubai on May 3, 2009

source ArabianBusiness May 03, 2009

Off-plan property sales in Dubai are “practically non-existent”, according to a new report released this week.

“State of the Market 2009”, published by Better Homes and Investment Boutique, warns that “off plan sales across the emirate are practically non-existent, and finished product is in demand mostly by end-users.”

The report adds that “there is still substantial room for price depression in order to meet true affordability levels.”

However, on a more positive footing, it suggests that “by the last quarter of 2009 prices are expected to hit a trough and the market is expected to gradually stabilise.”

The 100-page report was compiled over the past three months, and contains detailed analysis of the residential, commercial, retail and hospitality sectors.

“The report shows that we are going through very challenging times, where prices, targets and ambitions will have to be dramatically altered. This is a painful process,” said Better Homes managing director, Ryan Mahoney.

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Dubai Property Court – Realty developers, agent told to pay Dh1.77m to couple

Posted by 7starsdubai on May 3, 2009

source GulfNews

Dubai: Two property developers and a real estate promoter have been ordered to repay Dh1.77 million paid in by a couple for a 26th-floor-flat overlooking Dubai’s Business Bay.

The Dubai Real Estate Court ordered the Dubai-based promoter and property developers to repay the couple, a businessman and his wife, Dh1.77 million which they had deposited as a first instalment for the flat in a high-rise tower project.

Lawyer Dr Habib Al Mulla, of Habib Al Mulla and Co Advocates and Legal Consultants, who represents the couple, lodged the civil lawsuit against the defendants after they refused to collect the remaining instalments and write a contract then deliver the flat.

Presiding Judge Shehab Ahmad Al Shehi also ordered the defendants to pay the above-mentioned amount plus nine per cent legal interest.

Dr Al Mulla argued in his lawsuit that his clients purchased the flat for Dh17.7 million, out of the first payment was made to the promoter. “They collected a receipt for the first instalment. When the second instalment was due, the promoter asked my clients to pay it for the sake of one of the property developers based in Dubai.”

Dr Al Mulla said since the deal was made, it was his clients’ first encounter with the Dubai-based property developer.

“The claimants asked the promoter why should they pay the second payment to the Dubai-based developer before, they later agreed to pay & surprisingly, the promoter informed my clients that they stopped receiving payments for that project,” he continued.

He said his clients were asked to follow up with the Dubai-based developer and a Kuwait-based developer.

The Dubai-based developer met with the claimants and informed them that there were no problems and they would be collecting their contract within a week, according to the lawsuit.

“Since then, the plaintiffs had been avoiding the claimants, refused to collect any instalments and didn’t process the contract. Since my clients didn’t get the flat, the price of which tripled after sometime, they lodged this lawsuit and claimed Dh1.77 million plus Dh500,000 in financial and moral compensation for the damages they incurred by the plaintiffs’ act,” argued Dr Al Mulla.

Presiding Judge Al Shehi further ordered the plaintiffs to pay Dh3,000 in lawyers’ fees. The primary verdict is still subject to appeal.

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Confusion over RERA Rental Index

Posted by 7starsdubai on May 3, 2009

source 7Days

A new feature of the Real Estate Regulatory Authority (RERA) web site caused confusion over the expected Rental Index update today, as it seemed to indicate a fall of up to 50 per cent in rental rates.

The new ‘Rental Increase Calculator’ on the web site showed significantly lower rents across Dubai, in what many media reported as an indicator of the updated version of the Rental Index, expected before the end of April.

However, a spokesperson from RERA told 7DAYS that the authority was still working on the index and there was no official update as yet.

The ‘Rental Increase Calculator’ on the web site today showed that a three-bedroom villa in the Springs would now be priced at between dhs140,000 and dhs160,000 a year down by up to 50 per cent from the previous guideline of dhs250,000 to dhs280,000.

A studio apartment in Dubai Marina had fallen to dhs65,000 to dhs70,000 from dhs80,000 to dhs90,000, which would be a discount of up to 28 per cent, while a two-bedroom apartment in Discovery Gardens fell up to 37 per cent, from dhs130,000 to dhs145,000, to dhs90,000 to dhs125,000.

The calculator only recommends any increase in rent if the tenant is paying from ten per cent or more below the low end of these ranges, and in that case, it gives the maximum rent increase as five per cent. In no scenario is the maximum rent increase more than 20 per cent.

RERA had said it would release an updated version of the index first released in January, which was criticised at the time for showing prices nearer to 2008 peaks rather than prices impacted by the global economic slowdown.

The RERA spokesperson today could not confirm when the update would be released.

Go to  www.rpdubai.com

to see the ‘Rental Increase Calculator’

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