Troubled Dubai private equity firm Abraaj’s founder Arif Naqvi has denied reports that $660m of investor money was moved into bank accounts linked to him.
The Wall Street Journal reported on Tuesday that $200m of money flowed to Naqvi and people close to him without the full knowledge of investors.
The publication cited company documents, bank statements and sources as confirming the transfers to Naqvi’s personal accounts at Deutsche Bank and Coutts, as well as companies linked to him, his family and a former assistant.
“The allegations against me are entirely false and vehemently denied. They are premised on isolated extracts from illegally obtained documents that have been taken entirely out of context,” Naqvi said in a statement to The National.
He added that he had not “misused nor misappropriated any Abraaj funds”.
“There was nothing untoward about my requests for transfers of Abraaj Group funds to me or my family, or for my personal investments or obligations. In drawing down funds from Abraaj, I acted in accordance with the arrangements put in place by the Abraaj Group.”
Abraaj entered difficulties last year after investors in a $1bn healthcare fund, including the Bill & Melinda Gates Foundation and International Finance Corp, began questioning how the company was using their money.
A loss of confidence in the company, which managed $13.6bn at its peak, eventually resulted in the start of liquidation proceedings and the sale of Abraaj’s assets.
PwC is working as provisional liquidator for Abraaj Holdings and Deloitte for Abraaj’s investment management business.
Reuters reported this month that the interim manager of the healthcare fund had decided to redistribute Abraaj’s stake to other investors.
The WSJ cited investors as saying the healthcare fund was used for “unauthorised purposes”, claims Naqvi also denied – stating uninvested money was returned to investors.
He also denied claims that a $20m bribe was paid to Pakistani businessman Navaid Malik for his help in selling Abraaj’s stake in Pakistan’s K-Electric.
Abraaj was expected to receive half of the estimated $1.77bn proceeds from the firm’s sale, which was held back for years by regulatory issues.
Global private equity firms are bidding for other parts of Abraaj’s business under the liquidation process including its Middle East and Africa funds.