Deyaar officials accused of causing Dh4.5m loss

Two former Deyaar executives are accused of premeditatedly causing a loss of Dh4.5 million to the company, the Dubai Criminal Court heard.

ZS, 48, Lebanese-born US citizen, former CEO of Deyaar, leased a building owned by OBS for Dh10 million for the period January 15, 2008 to February 28, 2009 which helped OBS, a senior official, to make a profit of about Dh1.2 million. ZS is accused of doing this despite knowing that Deyaar will not make any profit by leasing the building.

Similarly, ME, 44, German, former CEO of Deyaar, renewed a lease contract of a building for a second year from March 1, 2009 to February 28, 2010  for Dh10 million which helped OBS to make a profit of about Dh3.2 million. ME is accused of doing this despite knowing that Deyaar would incur a loss of Dh1.3 million since it had suffered a loss by leasing the building from January 15, 2008 to February 28, 2009.

Khalid Ahmad, 41, Egyptian, from the Financial Control Department of the Ruler’s Court, testified that he found financial discrepancies after checking accounts of the company and hearing the testimonies of company executives and staff.

SMO, 40, acting CEO and development manager of Deyaar, testified that ZS had informed him that the board of directors was interested in leasing OBS’s building in Al Nahda area. “I assigned one of the company’s staff to prepare an economic efficiency study and reported to ZS the results which showed that there could barely be any profit in this investment,” he testified.

SMO testified that ZS verbally told him that OBS is an important official for the company which has dealings with the department that he runs and asked me to sign the contract even if the loss was expected to be in the range of Dh300,000 and that the cheque for this investment is ready.
“I was astonished but since there were written and verbal approvals of ZS about this investment, I prepared a one- year lease agreement of Dh10 million.

“It was proved that Deyaar lost Dh1.475 million by leasing this building. Staff of the Deyaa’s property management department sent to OBS’s company a letter informing them that the lease agreement will not be renewed for another year. But I was surprised to find out that ME had issued a cheque of Dh10 million and renewed the lease agreement despite the loss and the declining rents in the emirate,” he testified.

Other staff of Deyaar repeated similar testimonies.

The court adjourned the case to April 4.