Dubai dream may not be over as yet, but its fast fading away. Global recession has already reduced the tourists and foreign investment coming into Dubai real estate sector to bare minimum, and now the news of frauds and scams are there to further frighten off the investors. These days, Dubai is in the news for all the wrong reasons (the most recent being the standstill request being made by Dubai World, which has literally shaken the worlds economy). Theres no doubt that Dubai government is doing its best to control the damage, taking steps like tightening up on fraud companies and professionals, introducing new laws, and seeking financial help from Abu Dhabi (who doesnt appear too keen to help). However, the setbacks like recession, credit crunch and frauds are coming out in succession (just like the opening of Pandoras Box), making it really difficult for Dubai to regain its charisma. Sorting out all of these problems is not going to be easy, but one thing is sure; Dubai cannot afford to loose its credibility at this critical juncture.
Dynasty Zarooni was one of the first well known real estate company to appear in the news along with fraud allegations. The chairman Kabir Mulchandani, who at first denied the allegations (not surprisingly), ended up being held later on accusations of fraud and embezzlement. The lawsuits filed against the firm involved more than AED 6 billion. Then some top officials at Nakheel were investigated for bribery charges. Even though, you cant blame Nakheel for the wrongdoing of its executives, the name associated with the accused was enough to scare investors. A fairly recent scam to surface on the scene is the one that involves Al Fajer Properties.
Charges are laid against many individuals, lots of arrests being made, however thats not enough to satisfy the investors. One thing that continues to woe the investors is Dubai authorities attempt to brush locals involvement in some of these frauds, under the carpet. Many experts are now questioning the credibility of all these probes and sentences taking place. Nothing intimidates investors more than the risk of fraud, for that reason Dubai government needs to act fast before it is too late; otherwise itll be hard to get back investors trust and transparency once its gone. In that case, the Dubai authorities will have no one else to blame, but themselves.
Dynasty Zarooni was one of the first well known real estate company to appear in the news along with fraud allegations. The chairman Kabir Mulchandani, who at first denied the allegations (not surprisingly), ended up being held later on accusations of fraud and embezzlement. The lawsuits filed against the firm involved more than AED 6 billion. Then some top officials at Nakheel were investigated for bribery charges. Even though, you cant blame Nakheel for the wrongdoing of its executives, the name associated with the accused was enough to scare investors. A fairly recent scam to surface on the scene is the one that involves Al Fajer Properties.
Charges are laid against many individuals, lots of arrests being made, however thats not enough to satisfy the investors. One thing that continues to woe the investors is Dubai authorities attempt to brush locals involvement in some of these frauds, under the carpet. Many experts are now questioning the credibility of all these probes and sentences taking place. Nothing intimidates investors more than the risk of fraud, for that reason Dubai government needs to act fast before it is too late; otherwise itll be hard to get back investors trust and transparency once its gone. In that case, the Dubai authorities will have no one else to blame, but themselves.