June 28, 2018 / 11:50 AM / 3 months ago

UAE court to rule on Abraaj founder check case next week

SHARJAH, United Arab Emirates (Reuters) - A United Arab Emirates court is expected to rule next week on a criminal case against Abraaj founder Arif Naqvi for issuing a check without sufficient funds, a lawyer involved in the case said on Thursday.

FILE PHOTO: Arif Naqvi, Founder and Group Chief Executive of Abraaj Group attends the annual meeting of the World Economic Forum (WEF) in Davos, Switzerland, January 17, 2017. REUTERS/Ruben Sprich/File Photo

The Sharjah court case relates to a check for 177.1 million dirhams ($48 million), signed by Naqvi and fellow executive Muhammad Rafique Lakhani, and written to Hamid Jafar, another founding shareholder in private equity firm Abraaj, according to a prosecution document and a clerk at the prosecutor’s office.

The public prosecutor’s office issued arrest warrants this month against Naqvi, who founded Abraaj in 2002, and Lakhani in the latest blow to the Middle East’s biggest private equity fund, which is in dispute with four investors over the use of their money in a $1 billion healthcare fund.

Dubai-based Abraaj, which is filing for provisional liquidation in the Cayman Islands due to problems stemming from the investor row, has denied misusing their funds.

However, the allegations have led to a break-up of the private equity group, a sale of its assets and a proposed debt restructuring with its creditors.

Hassan Arab, from Al Tamimi & Co, the law firm representing Jafar, said the court had reserved the case for judgment and sentencing on July 5. The punishment for issuing a bounced check under UAE law can be jail or a fine.

Naqvi, Lakhani and their lawyers did not appear in court on Thursday and could not be immediately reached for comment.

Reporting By Hadeel Al Sayegh; Writing by Tom Arnold; Editing by Andrew Torchia and Alexander Smith

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