As a result, the DFSA imposed a fine, after a 30% settlement discount, of $720,905 (AED 2,645,721) on OCS, and $186,003 (AED 682,631) on its CEO, Mr Christian Franz Thurner.

Alongside the financial penalties, Thurner has been prohibited from holding any executive or employee position in an Authorised Person, Designated Non-Financial Business or Profession, Reporting Entity, or Domestic Fund. He is also restricted from performing any financial service-related functions in or from the Dubai International Financial Centre (DIFC).

The DFSA’s investigation revealed a series of regulatory violations committed by OCS, including:

• mishandling approximately USD 46 million in client funds before being authorised by the DFSA to carry on financial services within the DIFC;
• misleading its bank by submitting false documents related to these client funds;
• failing to maintain these funds in a separate client account and misusing them for purposes not authorised by the client;
• providing its bank with misleading documents that disguised the true nature of its financial arrangement with the client. Despite agreeing with the client to void the agreement, OCS presented a falsified version of the agreement to the bank;
• submitting false or misleading information to the DFSA, including concealing Mr Thurner’s prior convictions during his application for DFSA authorisation, and sharing incorrect information on the client’s bank account opening dates. Both OCS and Mr Thurner repeatedly failed to provide the DFSA with bank statements, including one that documented the receipt of the USD 46 million in client funds;
• Obstructing the DFSA’s investigation by withholding required documents; and consistently failing to meet the DFSA’s regulatory reporting requirements.

Regarding Thurner, the DFSA found that he was knowingly involved in several of OCS’ contraventions, and obstructed the DFSA’s investigation.

These breaches not only violated the DFSA’s Principles for Authorised Firms and Individuals, particularly those related to integrity, but also threatened the stability and trust of the DIFC, a critical financial hub in the region, the regulator said.

Ian Johnston, chief executive of the DFSA, said: “The integrity of the DIFC is essential in maintaining investor confidence. Firms and individuals in the DIFC must adhere to the highest standards of conduct and integrity, especially when dealing with client funds. Our enforcement actions send a strong message that we will not tolerate misleading or obstructive behaviour, and we will take necessary steps to protect investors.”

Baker Tilly failed to assemble complete and final sets of audit documentations for several audit files in a timely manner. This is in violation of the International Standard on Auditing 230, Audit Documentation, and the International Standard of Quality Management 1. Audit documentation demonstrates the integrity of the audit process and acts as a written record that provides support for the auditor’s opinion.

The violation continued over a three-year period.

The DFSA said it acknowledged Baker Tilly’s cooperation in dealing with this matter.

Ian Johnston, chief executive of the DFSA, said: “When auditors fail to meet their responsibilities, it casts doubt on the integrity of financial reporting. Our action today reminds Registered Auditors that as gatekeepers for DIFC financial markets and financial services businesses, it is critical that they comply with the auditing standards.”

More details of the case can be found here.

In a statement today (20 August) the DFSA said Georgiou was employed by MMEL as a private banker.

In addition to the financial penalty, the DFSA has prohibited Georgiou from holding office or being an employee of a DFSA authorised firm.

He is also restricted from performing any function in connection with the provision of financial services in or from the Dubai International Financial Centre (DIFC).

The DFSA determined that Georgiou lacked integrity and is not fit and proper to be involved in the provision of financial services in or from the DIFC.

In particular, the DFSA found that Georgiou had knowingly provided misleading information to MMEL’s compliance team and withheld relevant information in order to circumvent MMEL’s anti-money laundering (AML) systems and controls.

He had also knowingly sent a forged deceptive and misleading email to a client; and provided false, misleading, or deceptive information to the DFSA during an interview.

In July 2023, the DFSA fined MMEL €3m for inadequate AML systems and controls.

Georgiou was also found to be knowingly involved in MMEL’s failure to conduct due diligence on existing customers at appropriate times, particularly when there was doubt about the veracity and adequacy of provided documents or suspicion of money laundering; and
perform adequate assessment of clients’ financial markets experience when classifying them as Professional Clients.

Ian Johnston, chief executive of the DFSA said: “The DFSA expects those working in financial services within the DIFC to comply with the DFSA’s AML rules. We also expect firms and individuals to engage with the DFSA in an open and honest manner, and to uphold the highest standards of integrity.

“The DFSA remains committed to holding those who fail to meet these expectations to account. The sanctions imposed on Mr Georgiou reflect the severity of his misconduct and serve as a strong warning to others who may consider engaging in similar behaviour.”

As part of the investment platform’s expansion, Mark Maplesden will join Novia Global as its principal representative officer.

Maplesden has worked in the wealth management sector in the UAE for over 10 years and will be  drawing upon his experience of the region to lead the initiative.

See also: Novia Global launches stocks & shares Isa

“Dubai’s economic and investment landscape are impossible to ignore,” said Steve Andrews, CEO at Novia Global. “There are over a thousand financial companies in the DIFC, while Dubai is home to over $950bn in private wealth and set to attract many more high-net-worth individuals.

“A growing number of advisers and clients want to be a part of this success story, and we see an on-the-ground presence as essential to our own role in helping make that possible,” he added.

“We see Dubai and the broader region as a spectacular market, it is now arguably the hub to the world and Mark is the ideal hire for harnessing all the opportunities that it presents.”