Why Arif Naqvi gets a record $135.6 million financial penalty

Abraaj Group's founder Mr Arif Naqvi:

• instructed the use of investor monies to fund the Abraaj Group's working capital or other commitments;

• prioritised the distribution of Abraaj fund sale proceeds and update reports to “noise makers and those who will come back, with the latest being legacy investors and passive voices”;

• was central to the cover-up of an approximately $400 million shortfall across two Abraaj funds by temporarily borrowing monies for the purpose of producing bank balance confirmations and financial statements to mislead auditors and investors;

• approved and personally drafted false and misleading statements to investors to cover up the misuse of their funds;

• approved the change of an Abraaj fund's financial year end to avoid disclosing an approximately $201 million shortfall, and agreed that the justification of aligning the Abraaj fund year end with the other Abraaj funds would be “selleable [sic] and compelling” to the limited partners of the fund; and

• personally arranged to borrow $350 million from an individual in an attempt to make the Abraaj Group appear solvent and appease the demands of investors.

Further, Mr Naqvi personally contributed to the liquidity problems at the Abraaj Group by taking interest free personal loans from it at a time when he knew that the Abraaj Group was incurring significant interest costs on borrowings in order to meet its major liquidity problems; his personal loans included monies taken from the Abraaj funds at a time when the funds did not have sufficient cash to make critical payments.