Courts

Canadian says Russian hired Australian hitman over Dh12m civil case, Dubai court hears

Russian investor 'with links to Chechen president' allegedly hired hitman to threaten Canadian and his family so he would drop civil case.

Salam Al Amir
Salam Al Amir

July 18, 2017

A Canadian filed a civil case for Dh11.9 million against a Russian investor who it is claimed has links to the Chechen president before he was threatened by an Australian hitman, a court heard on Tuesday.

The 41-year-old Canadian said that, after filing the case, he received a call from an Australian man in January, who told him that he hurts people for a living.

“He told me he hurt many people in Australia and that he was assigned to harm my family. Then he sent me pictures of my parents and other family members and locations of their offices as well as my passport copy to confirm to me that he can reach them,” said the man.

He added that the caller told him that the threats were serious and would be followed through unless he dropped the case against the Russian.

“No, not at all,” said the 40-year-old Australian defendant in court, denying a charge of issuing threats.

The investor, 38, denied a charge of aiding and abetting the Australian defendant.

Prosecutors said they found the pictures on the defendant’s phone, as well as several chats relating to the financial case.

During prosecution investigations, the Australian defendant allegedly confessed to making contact with people and ordering them to hurt the Canadian and his family and negotiating over the civil case. It is also claimed he said that the victim would settle for Dh9m.

The investor allegedly said to the Canadian that he was powerful because he is related to the president of Chechnya, Ramzan Kadyro, and that he can hurt him.

Both men denied charges in court on Tuesday.

The next hearing is on August 22.

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”