Fraud comes in many different forms and varying levels of sophistication. Larger companies, particularly financial institutions, tend to be targets of fraud, due to their size and the complexities of their operations.
While some plans are complicated and masterminded, others arise from opportunity. In our practice, we are increasingly encountering issues involving employees of financial institutions and other large corporations who use their positions and knowledge of internal policies and procedures to coordinate schemes for their benefit or assist their external contacts in fraudulent activity. For example, one recent fraud case we acted on involved the transfer of funds out of bank accounts known to be dormant or not checked regularly.
An employee used his access to amend contact details on the accounts which ultimately enabled the employee to approve orders and transfer instructions by telephone, resulting in the fraudulent transfer of funds out of those accounts. In other cases we have acted on, the financial institutions were targeted by sophisticated groups that use shell companies, fake documents and dummy transactions to secure loan facilities.
These activities are sometimes conducted as an independent fraud or with the assistance of someone inside the institution. In such cases, while criminal liability for the fraudulent act committed by an employee is generally limited to such individual, the civil liability can also be borne by the employer under the doctrine of vicarious liability. In such instances, and the third party is not necessarily required to include the employee when filing a claim.
Moreover, external expert reports and court judgments recognize and make clear that internal policies, adequate IT resources and a diligent corporate governance system are essential in preventing and identifying abuses. As such, institutions face direct liability for loss of funds when they are defrauded by an employee into issuing loans, credit card debt or other facilities. All too often, such frauds are only identified after they have taken place and, even worse, become too large to sustain.
Accordingly, institutions can suffer, or even collapse, when significant losses are incurred. Minimising such exposure requires internal policing efforts, which requires a combination of improved systems, processes and corporate governance checks to close gaps that dishonest employees may exploit, as well as adopting improved, multilayered verification systems to safeguard client information.
This article, including any advice, commentary or recommendation herein, is provided on a complimentary basis without consideration of any specific objectives, circumstances or facts. It reflects the views of the writer which may, in some cases, differ from those of the firm, especially in the developing jurisdiction of the UAE. Type Event Press Release Article.We regularly receive requests to advise and assist clients on the collection of outstanding debts.
The increase in debt recovery cases in the courts has prompted us to reflect further on debt management. This article discusses the reason why debt collection is becoming increasingly difficult, the legal processes one must go through to recover the debt and some precautions parties can take to reduce the risks. Non-payment of invoices for goods or services is a financial concern for all companies, as they naturally depend on regular cash flow in order to operate their business normally.
Traditionally, having exhausted the usual communication channels, an early course of action is for the party owed money the debtee to issue a pre-action letter to the party who owes the debt the debtor. This letter is important as it sets out the outstanding obligations and may allude to the legal ramifications should the debtor fail to pay.
Typically, the debtor has delayed payment for some time and this pre-action letter sets out a strict deadline for payment of the debt and, sometimes, an invitation to meet to discuss and reach an alternative resolution. Acknowledgment from the debtor must indicate that the right admitted is proved definitively and conclusively, in other words there is no doubt that the debt is payable, and the debtor in effect accepts that it must fulfill its legal obligation.
However, if there is any debate over the validity or extent of the obligation i. Irrespective of whether an acknowledgement of the obligation is obtained, the next step in recovering an unpaid debt would be a civil claim.
Whether the claim will be handled by the courts, or is subject to arbitration, depends on the underlying agreement. The monetary value of the claim may also determine how and where the claim will be brought. Smaller value claims may not always justify the legal fees and costs associated with arbitration. For example, Dubai court fees are calculated based on claim amount and capped at AED 40, which provides a straightforward debt collection process.
There is, however, no such cap in the Abu Dhabi courts. However, certain parties still elect to include arbitration clauses to protect wider interests. We also occasionally see arbitration clauses that endeavor to specifically exclude claims related to unpaid invoices in an effort to ascribe those to the jurisdiction of the courts. While enforceable, in principle, this approach can lead to complications if not carefully drafted, for example if various other matters are also at issue, including non-performance, or breach of non-monetary rights.
When considering debt recovery actions in court or arbitration, one must also consider the possible impacts of delay and cost, together with the risk of not achieving a positive outcome. This requires careful analysis at the outset. When conducting such assessment one must also take into account the solvency of the debtor, and the strategy for future enforcement against valuable assets.
Taking into consideration all the potential risks, it is often best for parties to attempt to reach an amicable resolution before resorting to litigation or arbitration. Commercially, it may be better to accept an immediate assured settlement, albeit of a lower amount, rather than risk a potentially lengthy and costly process in the courts or in arbitration.
However, this requires both parties and their lawyers to work diligently to assess and reach a mutually acceptable resolution. Such a resolution may include providing extended payment terms or even the offer of a discount conditional on payment.He has gained much experience working for both multinational and local entities regarding all manner of disputes in the local UAE Courts and arbitration proceedings.
His practice includes a broad range of commercial matters with particular experience in shareholder, commercial agency, banking, and real estate disputes. Karim also regularly advises on cross border disputes with white collar matters often encompassing complex corporate fraud, tracing, freezing and recovery of assets, anti-money laundering, extradition, and mutual judicial cooperation, including issues relating to foreign judgments and Interpol notices.
He is fluent in English and Arabic. Each of our promoted lawyers brings strong local knowledge and insight coupled with international experience to support our clients in achieving their business objectives and addressing any legal challenges.
In this article, we discuss a case in which we successfully argued on behalf of our client that an agency agreement should be de-registered.
Karim Mahmoud and Khalid El Derderi, both Senior Associates in the Dispute Resolution department, were successful in the Dubai Court of Cassation in a case involving an Option Agreement and whether it could be considered to be a substitute for a Sale and Purchase Agreement in relation to property. The Court nullified the Option Agreement and our client was awarded the entire amount claimed, plus interest.
Walid Azzam, Partner, and Karim Mahmoud, Associate, discuss ways to ensure the collection of outstanding debts and the preventive measures that can be taken. Partner, Walid Azzam, and Associate, Karim Mahmoud, discuss the challenges of criminal complaints and the practicalities of getting these accepted by the UAE government authorities. Monthly report based on practical experience of our team of advocates in the courts of the UAE. This month, Tarik El-Bakri discusses a recent trade mark decision which highlights the benefits of registering in the UAE.
Expertise Dispute Resolution. Experience Testimonials Publications. De-registration of an agency agreement In this article, we discuss a case in which we successfully argued on behalf of our client that an agency agreement should be de-registered. Hadef in the Courts: Option Agreements and whether they should be considered as a substitute for a Sale and Purchase Agreement in relation to Property Karim Mahmoud and Khalid El Derderi, both Senior Associates in the Dispute Resolution department, were successful in the Dubai Court of Cassation in a case involving an Option Agreement and whether it could be considered to be a substitute for a Sale and Purchase Agreement in relation to property.كارم محمود في أغنية \
Hadef in the Courts — Debt Management and Collection Walid Azzam, Partner, and Karim Mahmoud, Associate, discuss ways to ensure the collection of outstanding debts and the preventive measures that can be taken. Related Expertise Dispute Resolution.Service of summons can be a major hurdle to overcome in any normal civil case. Service, however, can become more complicated when the plaintiff is faced with defendants in foreign jurisdictions.
In such cases, service is traditionally conducted through diplomatic channels. In order to facilitate the judicial process, a number of GCC and Arab countries have signed agreements of judicial cooperation. The Riyadh Convention is intended to facilitate the judicial cooperation between the signatory countries. Signatories to the Riyadh Convention enjoy a broad range of bilateral support that can make obtaining relief against a foreign defendant much easier.
Previously, serving an Egyptian defendant in a UAE case required service through diplomatic channels — a process that is quite lengthy and provided no certainty of success. The main article which may facilitate the execution of services is Article 6 of the Riyadh Convention. Article 6 states that legal documents and papers relating to civil or commercial cases shall be sent directly by the authority or the competent legal officer to the court of the place where the person who is required to be served resides.
In practice however, the process requires collaboration with a lawyer in Egypt or as applicable, the other jurisdictions under the Riyadh Convention in order to receive the original copy of the UAE court summons and proceed with the follow up of the service in the other jurisdiction. In certain circumstances, it may be required for the local counsel to do some additional work when approaching the court as the local courts, in some jurisdictions, are sometimes unaware of the Conventions existence, let alone its application.
In summary, serving a UAE Court summons to Egyptian defendants via the Riyadh Convention is a more efficient alternative to service through diplomatic channels which can be fraught with delay and uncertainty. This article, including any advice, commentary or recommendation therein, is provided on a complimentary basis, without consideration of any specific objective, circumstance or need.
It reflects views of the writer which may differ from those of the firm. Having read this article, any person taking action, or refraining from taking action, does so at their sole risk.
Type Event Press Release Article.In the event of a claim against it can be difficult to recover amounts owed. It may also be that any potentially available can be liquidated, transferred out of the country, or otherwise hidden from potential judgment creditors.
As a result, it is possible to achieve a court judgment in respect of an outstanding obligation but with no immediate or easy way to recover. There is, however, a legal mechanism for recovering funds due to the debtor from third parties. Specifically, article 1 of the CPL states that any creditor may apply to the concerned court or to the emergency judge for the garnishment of chattels and debts even if they are deferred or conditional.
Such an order is subject to certain requirements defined in the CPL. In one of our recent cases, our client was owed money by a defendant. We applied for and obtained a garnishment order on the outstanding payments owed to the defendant by a third party for both prior work completed as well as ongoing projects. Procedurally, the third party was ordered to direct the payments to court under article of the CPL, which states:.
In fact, it is only after the third party is notified of the obligation to pay the court instead of the debtor that the debtor is considered to have been notified. Practically speaking, this process requires identifying assets subject to garnishment. To do this, the relevant court may send letters to third parties requesting confirmation of monies due to defendant.
Any such third party that receives such a letter is obligated to answer even though it has no direct obligation to the claimant. We note that garnishment could be requested as either a precautionary attachment or at the execution level after a judgment is obtained.
This provides the option to garnish an upcoming payment from the third party before defendant has chance to receive it and dissipate the funds. The judge will consider the application and assess the existence of a credible risk that the claimed monies will not be available in the event of a successful award.
In case of execution, the matter is presented to the execution judge who can then order for inquiries to be issued to third parties regarding any monies owed to the defendant.
While garnishment applications may not be easy to secure they provide a potential alternative means of securing recovery where the opposing side does not have clear assets to seize.
This enables the identification of assets in the event that such procedure is required for a specific case. This article, including any advice, commentary or recommendation herein, is provided on a complimentary basis without consideration of any specific objectives, circumstances or facts. It reflects the views of the writer which may, in some cases, differ from those of the firm, especially in the developing jurisdiction of the UAE.
Type Event Press Release Article.The 100th episode of the Echo Chamber breaks down key themes that have emerged and offers up some predictions for the future. Aarti Shah 27 Nov 2017Holmes Report identifies 25 professionals reshaping the marketing and comms world across the America. Arun Sudhaman 13 Nov 2017Holmes Report identifies 25 professionals reshaping the marketing and comms world in EMEA, and finds. We feel that the views of the reader are as important as the views of the writer.
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Karim Mahmoud Hadef
Influence 100The world's 100 most powerful corporate communicators. Innovator 25The Holmes Report profiles marketing and communications innovators from across North America, EMEA and Asia-Pac.He is a superstar punter who has an illustrious gambling career. Harry discusses many things including his involvement with Star Lizard and Asian handicaps, how he sees the betting industry and some of his infamous betting stories.
Ep: 24 - Daniel Kustelski Daniel was born in the US, and having spent time in South Africa has gained experience in global betting and wagering. He has run a number of betting businesses, and is back in America as the CEO of Chalkline Sports.
Daniel discusses everything from in-play betting, the US betting landscape and the challenges for operators and bettors in the 2017 global betting climate. Ep: 23 - Rahul Sood Rahul is the CEO of Unikrn, a Seattle based esports platform, which has seen investment from the likes of Ashton Kutcher and Mark Cuban. Ep: 22 - Kevin Braig Kevin is a full time attorney from Columbus, Ohio and the brain behind the Quant Coach.
Kevin covers many topics including play design, coaching IQ and even how he once lined up against Ken Griffey Jnr in high school. Ep: 21 - Victor Haghani Victor is a very well known finance and investing expert. Victor started out at Salomon Brothers before moving on to places including John Meriweather and Long Term Capital Management. Currently, he is the Founder and CEO of Elm Funds.
Victor joins the podcast to chat about a myriad of topics including his recent research paper and experiment titled Rational Decision Making under Uncertainty.
We discuss this and more. Ep: 20 - Peter Ling - The Secret Betting Club Peter runs the Secret Betting Club which is the Trip Advisor of tipsters. The Secret Betting Club is an independent and quality service that helps punters and bettors with all the information that they need to succeed. BONUS Episode - 2017 NFL Season Preview In this bonus episode, Adam Chernoff and Kevin Braig speak about the upcoming 2017 NFL Season from a betting perspective. You can listen to a full episode with Adam Chernoff (Episode 4) and there will be a full episode with Kevin Braig very soon so look out for that.
Episode 19 John Walter.
John Walter is a professional punter and Jockey Manager. John takes us inside his time at world leading betting operation Humbleton led by the renowned Zeljko Ranogajec. John talks about what it is like to be a Jockey manager, some tips and tools for punters and racing as an industry and the wagering product. Ian and Luke met when they were students at the University of Arizona and Co-Founded PropSwap in 2013, in Las Vegas.
Luke came from the finance world and spent time at Bloomberg and also trading stocks before founding PropSwap, whilst Ian has been in Vegas since 2012 and spent time at Cantor Gaming sportsbook prior to PropSwap.
Ian and Luke chat with me about sports betting, their business, what the industry is like and what part of the betting world PropSwap fits into. Daniel O'Sullivan has spent over a decade working in the racing world. He is a professional punter and racing analyst who offers highly valuable punting insights and advice through his service Bet Smart.
Daniel is a leading mind when it comes to the philosophy and broader topics of racing and wagering. We discuss the current wagering environment, betting for a living and much more. Allen Bari is a World Series of Poker Bracelet winner and has amassed millions of dollars in poker winnings over his career.