DUBAI, (Reuters) – Dubai jewellery group Damas International Ltd said chief executive officer and managing director Tawhid Abdulla had resigned after disclosing “unauthorised transactions”.
Nasdaq-listed Damas said it had appointed Hisham Ashour, formerly deputy CEO, to take over Abdulla’s post. It said Tawfique Abdulla, Tawhid’s brother, was now managing director on a “day-to-day” basis.
“The company today announces that it has accepted Tawhid Abdulla’s resignation as managing director and CEO due to his disclosure to the board of what is understood to be unauthorized transactions conducted by him,” it said.
“The full extent of these transactions has not been ascertained at this time but the company’s initial estimate is that these transactions could amount to approximately $165 million.”
Abdullah confirmed the information in the Damas statement, telling Reuters: “Whatever is in the announcement, I’ll stick to the announcement.”
Damas said the Abdulla brothers, who own more than 50 percent of Damas shares, had agreed to repay money involved in the transactions. It gave no more detail.
Dubai has in recent years joined the club of major gold trading centres such as London, New York and Hong Kong thanks to its proximity to the world’s gold consumer India and an aggressive drive to become a regional commodities hub.
Authorities in Dubai, an emirate of the United Arab Emirates which was hit badly by the global financial crisis, last year launched a campaign to improve business transparency. A number of business and political figures have faced prosecution.
The world’s key oil-exporting region has seen financial scandals in recent months that have highlighted problems in business practices and regulatory standards.
Saudi private enterprises Saad Group and Ahmad Hamad Algosaibi & Bros defaulted on debts this year, embroiling the firms in legal battles in the United States and exposing banks to billions of dollars in writedowns.
A Kuwaiti broker committed suicide in July after he was sued for fraud by U.S. regulators over suspicious stock trades.