Dubai Financial Services Authority (DFSA) has fined Remi Ishak, former CFO of Emirates REIT manager Equitativa, $33,220 for being knowingly concerned in misleading statements and accounting breaches.

The DFSA said it had penalised Equitativa in 2021 for breaches including making misleading statements in relation to the REIT and not preparing financial statements in accordance with regulations.

The authority said it had found that Ishak was knowingly concerned in those breaches, specifically that he made public statements in relation to a school, that had been vacated by the previous tenant with unpaid rent of over AED 9 million ($2.45 million), to the effect that a new tenant had been secured to start in the following academic year (i.e., September 2019).

“Those public statements implied that the asset’s revenue and valuation would be unaffected and therefore were misleading since there was no binding offer or agreement in place at the time,” DFSA said.

Ishak, who worked at the group from 2017 to 2019, also signed off on Emirates REIT’s 2018 half-year financial statements without including a provision for the unpaid rent or any impairment of the asset value for the school, instead reporting it as 100% occupied.  

He failed to take reasonable steps to ensure that Equitativa or its employees reported certain information, relevant to the recoverability of the asset, to Emirates REIT’s external auditors for their review of the 2018 half-year financial statements, the DFSA said.

Last year, the real estate investment trust (REIT) successfully refinanced its $400 million sukuk, which was due to mature at the end of 2022, with a new maturity date of December 2024. 

(Reporting by Imogen Lillywhite; editing by Seban Scaria)