Tougher penalties proposed for money laundering and fraud
abu dhabi — The Abu Dhabi Judicial Department (ADJD) has proposed to enforce tougher penalties for financial crimes like money laundering and fraud, through an amendment of penal code.
Sources at the department said they are seeking to increase punishment for commercial fraud from a three-year jail term to seven years in certain cases. The proposal would also suggest the convicts be made to pay back the stolen amount, in addition to paying civil compensation to the victims.
During a meeting at the ADJD, Hassan Mohammed Al Hammadi, head of the Abu Dhabi Monetary Fund, said that the money launderers and scamsters affect people and the national economy.
“Money laundering affects the national economy and financial stability because it’s a hidden economic activity and it’s illegal,” said Al Hammadi.
“Scamsters spoil the investment environment and cause damage to capital markets. In addition, the act of obtaining money through fraudulent means instills bad morals in the society, with the desire to get rich quickly.” The department said it has set up a legislative committee to look into the proposal for amending the law on financial fraud, to increase the penalty for convicts in order to protect individuals and society. The committee will also suggest means of increasing awareness among people through
Money laundering affects the national economy and financial stability because it’s a hidden economic activity.” Hassan Al Hammadi Head of Abu Dhabi Monetary Fund
campaigns on the danger of being involved in financial crimes. Officials said that they have seen many investment scam cases in Abu Dhabi over the recent years that involved big amounts of money and thousands of victims.
Major financial scams
In the latest case early this year, the Abu Dhabi Police reported the arrest of 43 people in connection with a car scam worth Dh1.3 billion, which affected more than 3,700 people.
The arrests were made after a six-month investigation into the fraud after more than 400 investors complained to the Abu Dhabi Police in five days.
The three people who were managing the scam hoped to make sizeable returns from selling cars on credit. Authorities however didn’t reveal how the fraud worked. The police said a total of Dh53 million in cash was seized from the residences of the gang members and from car showrooms they owned. Another Dh100m in their bank accounts was frozen.
The police said 423 vehicles were also seized from 16 showrooms and 3,700 cheques were confiscated. Judicial authorities said the case is still being investigated with some suspects outside the UAE to be brought in for trial after getting court orders.
In another big investment scam during 2008 — commonly known as the ‘The non-existent wallet’ — more than 2,500 people were conned of Dh400 million by fraudsters. Authorities said the main accused — an Arab man — and his brothers swindled thousands of people by promising them returns of up to 30 per cent for investing money in an unlicensed investment portfolio. Properties and assets of the Arab man and his family were confiscated upon the court order and was deposited on a special account, which was used to settle debts to the investors.