Rogue financial adviser convicted by Dubai court in landmark case

A personal finance consultant has been convicted of running his business without a licence, amid claims that he invested his clients' money in high-risk start up companies without their knowledge.

Neil Grant was convicted by Dubai Criminal Court of operating his company without being registered with the authorities.

Clients raised the case with Dubai Public Prosecution, and the Department of Economic Development supported claims he had operated without a licence.

A number of his clients have alleged that the Scotsman pumped money that they invested with him into waste removal firms and student accommodation in the UK,  losing their investments in the process.

Clients that spoke to The National said they lost tens or hundreds of thousands of dirhams.

Grant, who ran Prosperity Offshore Investment Consultants, did not attend an appeal hearing in November and left Dubai. He was fined Dh2,000.

A civil case has been opened by his victims to try to recover their investments. They claim total losses run into the millions.

Grant did not respond to repeated attempts to contact him in recent months, and his lawyer decline to comment when approached during his court case.

One of his clients, Amber Waheed, was working in construction when she began looking for financial advice, and was recommended to Grant by a circle of friends.

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"He was also an expat and understood the financial rigours of investing here, so he came across as trustworthy - especially as he had been recommended by friends," she told The National.

“Other high level people with money had invested with him, so I thought - why not?"

“I gave him a substantial sum, and others gave him millions of dirhams and have lost their life savings. The average amount lost is about 100,000 pounds."

“He had about 400 clients, and was taking a percentage from setting up funds, commissions and fees for moving investments to other funds.”

Alarm bells sounded when investors were told the value of their investments were wildly fluctuating in price. Many were surprised as they had plumped for more stable, long term investments.

Further investigation by investors uncovered details of the funds they had been invested into, which turned out to be high risk but offered huge commissions for Grant.

Most were described as short term, high risk, unregulated, illiquid funds.

Ms Waheed questioned Grant about his trade licence, and was eventually told he was working for Prosperity Management Consultancy, with a registered office at a top hotel in Dubai.

This was different to the previous name she had been given by him, of Prosperity Offshore Investment Consultants.

A further check on the Department of Economic Development revealed Grant was not licensed to offer financial advice.

When quizzed further, he told investors he had been trading under another name, and the licence of another brokerage in Dubai.

Another to take financial advice from Grant was David, a Briton who moved to Dubai in 2003, who took out four investment plans worth about $400,000.

Three were supposed to be long term plans, and one was a shorter, higher risk investment.

“I was naive and believed what I was told,” he said.

“Now I realise they were high risk, equity funds which are pretty unregulated. It is not something I would want to put my life savings into."

“He was recommended to me, and I then recommended him to others - which I now feel bad about."

“Looking back, it was a hard sell from him. Neil was a very personable chap, and I would be in his office for hours discussing things with him."

“His sales technique was to get to know me and my family, to win our trust and come across as a friend. He was very persuasive, and I ended up with two plans from the same provider that were virtually identical.”

David has lost in the region of Dh550,000, a large chunk of his life savings.

Fund managers were paying Grant about Dh18,000 for every investment fund he opened with them, so it is thought he made hundreds of thousands of dirhams in fees.

The commission on low risk investments is much smaller.

“I know we should have checked out his background more rather than rely on referrals,” Ms Waheed added. “It is an expensive lesson for all of us.”

She also faced difficulty bringing her case to court, with criminal lawyers quoting up to Dh100,000 to fight her corner.

The prosecutor initially said there were no charges, but an extension was granted and the case was eventually brought to criminal court.

Ms Waheed was told she had a legal case when she went to the insurance authority to complain, as Grant had claimed to be licensed by them, but was not allowed to act as a financial advisor. He claimed he was acting as a consultant.

When Grant failed to acknowledge her emails or calls, she contacted police in June 2016 and his passport was blocked and the case was transferred to prosecutors.

“The evidence against Neil Grant was complicated and I was very lucky to receive a verdict as Neil operated cleverly,” Ms Waheed said.

"I’ve been told by lawyers that this is a landmark case in that it's the first time a financial advisory has been taken to criminal court and judgment has been ruled in the victim's favour".