News

Dubai and money laundering are there any connections – example 5 -  Dubai's real estate market

25/08/2020

Dubai's real estate market is its crown jewel. In 2019 alone, it drew in AED 80 billion in investment (US$21.7 billion) through 41,000 real estate investments by over 31,000 investors from around the world.

The sector's secrecy and dose-to-zero fees make it a highly attractive jurisdiction not only for wealthy investors (close to 5,000 millionaires took up residence in the UAE in 2017 alone) but also to the corrupt and other criminals from around the world.

A plethora of cases has shown how high-end real estate in the emirate provides an opportunity to park large sums of money without disclosing its origin.

For instance, Dubai was revealed to be a prominent location for Nigerian Politically Exposed Persons (PEPs) to buy luxury property.

A data leak revealed 800 properties valued at US$400 million linked to 334 Nigerian PEPs, their family members, associates, and other suspected proxies.

The same data leak also revealed six Armenian PEPs owned multiple high-end apartments in Dubai. One, a Member of Parliament, was found to own an apartment worth approximately US$350,000. His monthly salary is US$1,350.

In another case, the purchase of Dubai property seems to be a vital part of the operation to launder the proceeds of an underground empire that smuggled goods, evaded taxes and exploited corruption in the customs service of Kyrgyzstan.

Kygryz tycoon Khabibula Abdukadyr and his family were shown to have made millions from such schemes. His former personal money launderer confessed to wiring US$104 million from Abdukadyr's companies to Dubai to purchase high-end real estate. His family also made a joint investment in the UAE real estate sector of the with the wife of Raimbek Matraimov, the former deputy head of Kyrgyzstan's customs service.

Leaked real estate data reveals her to be one of the owners of the land where a five-story building is under development.

As deputy head of customs, Matraimov's backing reportedly facilitated Abdukadyr's deals. Matraimov, however, has publicly denied allegations of wrongdoing.

Source - A recent report into attempts by the United Arab Emirates to combat money laundering and terrorist financing is damning, to say the least. - https://www.transparency.org/en/news/the-united-arab-emirates-a-key-piece-in-the-global-money-laundering-puzzle