Former Dubai bank executives face heavier penalty

* Dubai Islamic Bank executives on trial over $500 mln fraud

* Dubai jail terms can be up to 20 years for finance crimes

DUBAI, Oct 24 (BestGrowthStock) – A Dubai court restarted a fraud
trial against two former executives of Dubai Islamic Bank (DIB)
(DISB.DU: ) on Sunday having changed their status to government
officials, making a stricter punishment more likely.

The two, and five other suspects, are accused of defrauding
DIB, in which the Dubai government owns a 30 percent stake, of
1.8 billion dirhams ($496.5 million). It was not clear why they
were charged previously as private sector workers.

The United Arab Emirates penal code stipulates more severe
punishment for government employees and UAE law treats all
workers in state-related entities as public sector employees.

Dubai, the Gulf’s tourism and trading hub, launched an
anti-corruption campaign in 2008 that saw the arrest of several
high-profile business figures, including government ministers.

Since its debt crisis, Dubai, one of the UAE’s seven
emirates, has been doing forensic audits at state-linked firms.

The two men, Pakistani citizens, were arrested in 2008 and
first appeared before a Dubai criminal court in March this year.

But prosecutors refiled the case against the two defendants
on Sunday after the court asked them to do so in August,
charging them as government officials.

Dubai police have not been able to arrest two of the other
suspects, a U.S. and a Turkish citizen, who fled the country.

Prosecutors say the seven suspects swindled DIB by
submitting “documents and invoices about fraudulent deals”.

The case also involves three British businessmen who are
being detained in Dubai and are facing trial.

Last December, Dubai adopted a new law under which the state
can impose prison terms of up to 20 years for financial crimes.

The law came a little over a month after Dubai World
[DBWLD.UL], the emirate’s largest conglomerate, shocked global
markets when it asked creditors for a payment standstill on no
less than $26 billion of debt.
(Writing by Mahmoud Habboush; Editing by Louise Ireland)

Former Dubai bank executives face heavier penalty