Dubai Financial Services Authority today announced the imposition of a fine on Morgan Gatsby Limited of approximately $ 246,000 (approximately 900,000 dirhams), as part of its mission to consolidate transparency principles through the application of its system of laws and legislation aimed at providing a secure financial environment for all Parties in the Dubai International Financial Center, and maintain the image of Dubai as one of the best destinations for financial investments. The decision came against the background of its committing several serious violations of legislation issued by the Dubai Financial Services Authority. The authority previously suspended the license granted to the same company on November 8, 2018, due to concerns it raised about not complying with the authority's legislation.
This action came on the heels of the Dubai Financial Services Authority following an investigation conducted to show it that the aforementioned company, which is a company licensed by the authority, had committed violations of the legislation issued by it through the following practices:
Illegally promoting an unregulated foreign fund,
• Conduct unlicensed transactions on behalf of two clients, and engage in misleading and deceptive behavior in relation to those transactions,
Non-compliance with specific restrictions imposed by the Authority in May 2018 on business and property handling,
• The customer is not properly classified, and the required investigations are not conducted on the source of the client’s money and the justification for entering into those transactions,
• Failure to comply with the authority’s rules regarding safe custody of customer assets, and
• Not ensuring that the Company's Board of Directors is provided with accurate information.
The company agreed to settle the action taken by the Authority at an early stage of the investigations, which enabled it to obtain a discount under the Authority's early settlement policy. Had it not been for this deduction of the settlement, the fine imposed by the authority on the company would have reached approximately 352,000 dollars (about 1.29 million dirhams).
Brian Sterault, CEO of the Dubai Financial Services Authority, said: "Our action has been in line with our mission to monitor the performance of companies, and to ensure their compliance with legal regulations that regulate their work in accordance with our legislation that rise to the highest international practices in force, which contribute to providing protection and security for customers. And their investments, in order to consolidate Dubai’s position on the list of the most prominent international financial capitals. The imposition of these deterrent measures against (Morgan Gatsby Ltd.), after it became clear to us that it has a record of violations of the authority’s legislation, even after we notified it of the dramatic violations of For worry, we at the DFSA will never tolerate companies that continue to violate the authority’s legislation, despite warnings addressed to them. ”