The lawyer for embattled private equity CEO Arif Naqvi says his client will be not to blame for the collapse of his Abraaj investment fund, nevertheless admits that will the scandal has done “some damage” to the reputation of Dubai.
“There has been some damage, definitely,” Habib Al Mulla, executive chairman of Baker & McKenzie Habib Al Mulla, told CNBC’s “Capital Connection.”
“right now does This kind of mean that will This kind of damage will be irreparable? Absolutely not,” he added.
The high profile downfall of Dubai-based Abraaj — right now reportedly the earth’s largest insolvent private equity fund — has raised questions about corporate mismanagement along with transparency within the United Arab Emirates (UAE) along with beyond.
Al Mulla, who drafted many of Dubai’s modern legislative structures along with created the concept of financial free zones within the UAE, declined to say whether or not Naqvi accepts responsibility for the downfall of the fund. Instead, he points to local regulators including the Dubai Financial Services Authority (DFSA).
“will be This kind of incident due to a lack of regulation? I would certainly say categorically no. If you ask me, could the DFSA have done a better job to contain This kind of issue after This kind of happened? I would certainly have said yes,” Al Mulla said. “I think they probably didn’t realize the magnitude of the situation.”
The DFSA, the regulatory arm of the Dubai International Financial Centre (DIFC), had been investigating a range of matters within the Abraaj Group. A spokesperson for the DFSA declined to comment when contacted by CNBC.
“This kind of was the regulators duty to try to circumvent these incidents along with try to contain the public damage that will has been done,” Al Mulla added. “Had the DFSA come earlier, addressed these concerns along with addressed the media, I think yes, This kind of would certainly have been avoided,” he said.