• Home
• /
• Local business

Damas EGM Soon as Board Quits

DUBAI - Damas International Limited said it had received the resignations of the members of the board of directors in line with an undertaking provided to the Dubai Financial Services Authority, or DFSA.

The Dubai-based jewellery group, which was asked by the DFSA to dissolve its board after investigations proved irregularities in several “unauthorised transactions,” said in a statement published on the Nasdaq Dubai website on Monday that “the resignation of the board would become effective following the company’s extraordinary general meeting (EGM), which will be called for shortly.”

On Sunday, the DFSA banned the three Abdullah Brothers — Tawhid, Tawfique and Tamjid Abdullah — all founders of the retail empire, from the board of any DIFC company for up to 10 years and fined them a total of $3 million after they were found to have withdrawn Damas funds for their own personal use without disclosing it to the board.

Damas was also fined a total of $700,000. The DFSA said the “remedial action and enforcement sanctions” against Damas and its board were taken for their failure to exercise appropriate corporate governance over the company and its subsidiaries.

However, Damas said “the Abdullah brothers may be employed by, or act as consultants to, Damas or any of its subsidiaries,” in line with “an enforceable undertaking” entered into with the DFSA.

But “for specified periods, the Abdullah brothers will not hold any of the following positions at the company: Chief Executive Officer, Senior Executive Officer, Chief Financial Officer, Internal Auditor or Board Member,” the statement added.

“The company undertakes to apply the learning from these historical incidents, and wishes to assure its shareholders and employees that the company is currently focused on ensuring its long-term stability and growth, based on a sound, strategic business plan,” the statement said quoting a spokesperson as saying.

“Damas International Limited continues to work closely with the Dubai Financial Services Authority to ensure that the Company upholds the highest standards of corporate governance,” the spokesperson said. Damas also pledged that it would continue to keep the market informed of any further relevant developments.

The jewellery and watch group, which operates more than 450 outlets in the Gulf, also confirmed in its statement that the total amount owed to the company by the Abdullah brothers “is approximately Dh365 million plus the value of approximately 1.940 tonnes of gold, the price of which is to be fixed on a date agreed by Damas and the Abdullah brothers.”

“The company also agrees that, in line with the undertaking provided to the DFSA, the related transactions were not authorised by the company,” the statement added.

“More than a century after the company’s first operational milestone and 50 years after the opening of the first Damas-branded retail outlet, the company will continue to make the greatest efforts to meet the needs of its customers across the world, while also maximising value for the company’s shareholders,” the spokesperson added.

issacjohn@khaleejtimes.com