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Monday, 22 March 2010

Unprecedented action over Damas is a strong deterrent

The disclosures at Damas International represent a wake-up call for investors in the UAE and underline why standards of corporate governance need a closer look, now more than ever.

Unknown to many shareholders, the dynastic heirs of the business – the three Abdullah brothers – were able to withdraw money from a publicly traded company like it was a personal bank, the regulator said.

They also failed to disclose conflicts of interest on multiple occasions. For instance, they did not disclose to the company that they were the owners of a building in Sharjah that Damas bought for Dh84 million (US$22.8m).