The chairman of Dubai Properties, a unit of Dubai Holdings, has been arrested on suspicion of acquiring illegal profits from property transactions. The executive was taken in for questioning on October 19 by the newly formed Monetary and Public Funds prosecution, which is headed by the chief prosecutor Ismail Ali Madani, Dubai prosecution sources said. "[The executive] is accused of abusing his position and earning millions in illegal profit," Issam al Humaidan, Dubai's Attorney General, told Bloomberg yesterday.
"We are questioning him almost daily and [he] indicated he is ready to answer questions without having a lawyer present." No arraignment date has been set, and the investigation is continuing, Mr al Humaidan told Bloomberg. Under Dubai law, he can be held for 21 days, after which he must appear before a judge. Yaser al Amiri, the head of the Dubai Financial Audit Department, said in a statement this week that the executive, who has been replaced by Ahmad bin Byat as acting chairman of Dubai Properties, was referred to the Attorney General's office after a probe was launched into financial irregularities at the company.
In his statement, Mr al Amiri said the investigation by the Financial Audit Department was centred on the alleged abuse of power and position, and the attainment of illegal profits. A spokesman for Dubai Holding said the company and its subsidiaries were committed to the highest levels of corporate governance. "As such, we fully support the Dubai Government's initiatives to uphold these standards. Any reported issues are now a matter for the appropriate authorities."
Last year, Dubai began an investigation into allegations of corruption in property companies, which benefited from surging demand after foreigners were allowed to buy property for the first time. Several officials were arrested as part of the investigation, including the former chief executive of the Emirates' second-biggest property developer, Deyaar Development, and the former chief executive of the mortgage lender Tamweel.
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