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Ex-CEO of Drake and Scull International arrested after missing UAE hearing

In the latest news of legally-embattled ex-CEOs, it has been reported that the former chief executive of Dubai-based construction firm Drake and Scull International (DSI) has been arrested.

In 2018, news reports surfaced stating that Tabari and his daughter owed DSI up to $272.3m (AED1bn) Further to this, Tabari and other executives were accused of hiding billion of dirhams in losses from shareholders Tabari was the CEO of DSI from 1998 until 2016

In the latest news of legally-embattled ex-CEOs, it has been reported that the former chief executive of Dubai-based construction firm Drake and Scull International (DSI) has been arrested. The executive, Jordanian national Khaldoun Tabbari, was arrested in Amman at the Queen Alia International Airport on January 7, as he was catching a flight to the UK, informed sources told multiple GCC publications. 

Reasons for arrest 

According to Zawya, “Tabari’s arrest followed a January 7 Interpol red alert issued by the UAE. Tabari was supposed to appear before Abu Dhabi’s Public Funds Prosecution for criminal charges filed by DSI on misappropriation of funds and misusing powers as CEO. But he never came for the hearing, and a travel ban was imposed by UAE.”

Since his arrest, Khaldoun has been released on bail, after handing in his passport as a guarantee. 

“DSI has alleged that losses running into billions of dirhams were hidden from shareholders by the previous management between 2009 and 2017,” Zaywa explained. “The current management announced last year that accumulated losses had crossed more than 4 billion dirhams.”

Tabari was the CEO of DSI from 1998 until 2016, as per Zawya. As oil prices started plunging from more than $100 per barrel in September 2014 to below $30 by January 2016, the company started posting losses. 

News reports surfaced in July 2018 that Tabari and his daughter owed DSI up to $272.3m (AED1bn), tying in to the current accusations against Tabari. 

Moreover, Tabari isn’t the only DSI executive being investigated. 

As per The National, “Drake & Scull… said in an announcement in May last year it had handed over files ‘related to questionable projects for the period 2009-16’ as part of 15 legal complaints that were filed to the public prosecutor for what it described as “offences by members of the previous management during their tenure between 2009-2017. 

“The company did not name any of the executives involved, but in June 2018 Mr Tabari’s UAE bank accounts were frozen and a travel ban was issued against him,’ The National continued. “He was outside of the UAE at the time and hasn’t returned to the country since, although he says his lawyers have been in constant contact with the public prosecutor’s office.”

Currently, the UAE is attempting to extradite Tabari, since the UAE and Jordan are signatory parties to the Riyadh Arab Convention on Judicial Co-operation. 

A report released by Shuaa Securities, a part of Shuaa Capital — which was appointed as the restructuring advisor to support the contractor’s debt restructuring plan — in September 2019 cited Tabari who said that DSI’s accusations of financial violations against him were an attempt to find a “scapegoat” for rising losses, Construction Week Online stated.