Thousands of tenants and landlords have been left in limbo after the owners of two Dubai-based real estate agencies fled the country with their rent money amounting up to AED80 million ($21,779,979), UAE daily newspaper The National reported on Thursday.
The Pakistani pair Faisal Sulehri and Muhammad Zubair who handled properties in Dubai Marina, Palm Jumeirah and The Springs had been accepting one below-market-value cheque from tenants for properties and telling owners that they would give them a higher price in four cheques.
They ran away with at least half a year's rent for each property involved, leaving landlords with bounced cheques, the report said.
The Emirati sponsor of the two companies, Hareb Al Neaimi, said he is “not at fault” in the matter.
He said he was unaware of what was going on until it was too late. “Everyone knows me. I didn’t cheat anyone,” the daily quoted Neaimi as saying.
Authorities are moving to take action against the two firms, Marks Falcon and FHS.
The Real Estate Regulatory Agency (RERA) said it had frozen Marks Falcon’s activities. Action has yet to be taken on FHS, the second firm involved in the scam, though its office has been shut, the report said.
In a statement, RERA said: "Marks Falcon is licensed in conformity with regulations and has a AED5 million ($1,361,248) bank security deposit. Based on the complaint that RERA has received regarding the said company's practices that are in breach of its licensed activities, all the company's activities have been halted and the company has been fined."
“People are opening cases with the police about this scam, but I don't know how many yet,” the paper quoted a source at the Dubai Department of Criminal Investigation as saying.
A former employee of Marks Falcon said Sulehri and Zubair have not been seen since September 1.
"They have run away. The sponsor is trying to carry on but it's impossible for him," he said.
The scam comes on the back of a AED6 million ($1,633,519) con concerning the Saudi owner of Shamyana Entertainment Services, Haitham Al Kouatly, who fled leaving hundreds of landlords and tenants out of pocket. An international arrest warrant has been issued for him.
Following an increase in property scams, Dubai government has decided to clamp down on agencies and brokers who breach the emirate’s real estate laws by banning them from involving in any further property-related business.
“We are going to blacklist the companies that are found to be involved in these scams. We are already taking action against companies that violated rules and have sent notices to the economic department and Ministry of Labour that all transactions of these companies must be stopped," The National quoted Yousef Al Hashemi, the director of RERA’s licensing department said.