Financial tribunal delivers verdict against Al Masah; issues statement regarding Shailesh Dash

The stiff penalties imposed by the Dubai Financial Services Authority (DFSA) against Al Masah Capital has been upheld by the Financial Markets Tribunal (FMT), it announced on Wednesday.

Following an eight-day hearing earlier this year, the FMT issued its decision on October 27.

However, the tribunal said in its judgement in paragraph 111 that Al Masah’s founder Shailesh Dash “came over as an extremely intelligent and forceful individual… and is no doubt essentially a truthful person”.

It also added that Dash exhibited “a formidable mastery of the arguments in this case.”

The case essentially revolved around placement fees and the extent of disclosure to investors on transactions during a six-year period.

It involved complicated structures in which investors bought shares in companies that then bought shares in further businesses.

According to observers, the compliance officer reportedly did not pick up the issue and made returns accordingly, and though the DFSA says the case is “headscratchingly” complex, there was nothing hidden or underhanded about the structure, and that auditors, regulators and compliance officers could see it for what it was.

The case is believed to have far-reaching implications considering the prevailing perceptions of private equity and the downfall of Abraaj Group as well as the ongoing NMC Healthcare saga.

The Al Masah case demonstrates that Dubai strictly enforces the rules for its financial markets to ensure transparency, fairness and compliance with international law. Bryan Stirewalt, CEO of the DFSA, stressed that it would protect the interests of direct and indirect users of financial services at the DIFC. “Firms and the individuals in charge have a responsibility to ensure that all financial services activities in or from the DIFC are appropriately authorised and carried out properly,” he said.