In the wake of last month’s announcement that Dubai’s state-owned real estate investment company, Dubai World, was essentially broke and unable to repay $26 billion in debt, the emirate clearly needs to get its financial house in order. Today, the Emir of Dubai announced the establishment of a judicial panel to protect creditors and companies related to two large Islamic mortgage lender subsidiaries of the Dubai World conglomerate.
But another development may be even more important: the Dubai Government’s announcement yesterday of a new “zero tolerance” anti-graft law that aims to combat a culture of corruption so widespread that last September a special task force was convened to investigate fraud in several state-backed companies.
Under the new law, people convicted of corruption face five to 20 years in jail. But as reported by Gulf News, the law also creates the possibility for “the immediate release” of those convicted of fraud “once they fully return the money to their lawful owners or through settlement agreements negotiated with their debtors,” according to a government statement.
Experts are praising the new law.
“I believe that the new law will deter crime substantially because no one can now steal money and serve certain period in prison and eventually return to normal life and enjoy the money they snatched from the government or private establishments,” Ahmad Saif, Chief Justice of the Dubai Criminal Courts, told Gulf News.
The announcement comes in the midst of an embezzlement scandal involving the real estate developer Nakheel, and after a US national and former CEO of the regional real estate developer Deyaar, was charged with bribing a construction company for exclusive contracts.