Top Abraaj executives arrested on US fraud charges

Arif Naqvi, Founder and Group Chief Executive of Abraaj Group has been arrested in London. (File photo/Reuters)
Updated 12 April 2019
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Top Abraaj executives arrested on US fraud charges

NEW YORK/LONDON: The chief executive and a managing partner of the collapsed Dubai private equity firm Abraaj Capital Ltd. have been arrested on US charges that they defrauded their investors, including the Bill & Melinda Gates Foundation.
Abraaj founder and Chief Executive Arif Naqvi was arrested in the United Kingdom last Friday, while managing partner Mustafa Abdel-Wadood was arrested at a New York hotel on Thursday, Assistant US Attorney Andrea Griswold said at a hearing in Manhattan federal court.
Griswold said prosecutors would seek to have Naqvi, who is charged with the same crimes, extradited. Casey Larsen, a spokesman for Naqvi, could not immediately be reached.
A statement from Naqvi’s external PR firm said Naqvi maintained his innocence in relation to the charges.
“Mr Naqvi maintains his innocence, and he fully expects to be cleared of any charges. For almost a year since the commencement of the provisional liquidations, he has been working tirelessly to maximize returns for Abraaj’s creditors,” the statement said.
Abdel-Wadood appeared at the Manhattan hearing and pleaded not guilty to securities fraud, wire fraud and conspiracy charges. His lawyer, Benjamin Brafman, did not immediately request bail, saying he needed more time to become familiar with the case.
Abraaj had been the largest buyout fund in the Middle East and North Africa until it collapsed in the middle of 2018 after the Gates Foundation and other investors raised concerns about the management of its $1 billion health care fund.
In brief indictments unsealed on Thursday, US federal prosecutors claimed that from about 2014 until Abraaj’s collapse, Naqvi and Abdel-Wadood lied about the performance of Abraaj’s funds, inflating their value by more than half a billion dollars.
The US prosecutors also said that Naqvi and Abdel-Wadood caused “at least hundreds of millions” of investor funds to be misappropriated, either to disguise liquidity shortfalls or for their personal benefit or that of their associates.
Griswold said that Abraaj had represented itself as a pioneer of “impact investing” that promoted social progress, for example by investing in hospitals in developing countries.
“In truth, Abraaj was engaged in a massive fraud,” she said.
The indictments were short on detail, Griswold said, because authorities moved quickly to arrest Abdel-Wadood upon learning he was in the United States with his wife and son to visit colleges.
She said prosecutors intended to file more detailed charges by the end of May.
After the hearing, Abdel-Wadood spoke briefly to his wife, who had watched from the courtroom gallery, before US marshals led him away in handcuffs.
Naqvi appeared in a court in London on Thursday and was remanded in custody to appear again on April 18 at Westminster Magistrates Court for the extradition case via video link, a court official told Reuters on Friday.
Abraaj and Naqvi face related civil charges filed on Thursday by the US Securities and Exchange Commission. Naqvi denies these charges. Liquidators of Abraaj could not be immediately reached for a comment.
The SEC alleges that Naqvi and his firm raised money for the Abraaj Growth Markets Health Fund, collecting more than $100 million over three years from US-based charitable organizations and other US investors.
According to the SEC’s complaint, Naqvi misappropriated money from the health fund and commingled the assets with corporate funds of Abraaj Investment Management Ltd. and its parent company, and used it for purposes unrelated to the health fund.


British Airways to resume Pakistan flights next week after a decade

Updated 23 May 2019
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British Airways to resume Pakistan flights next week after a decade

  • BA halted service to Pakistan in the wake of the 2008 Marriott Hotel bombing in Islamabad
  • BA will begin the London Heathrow-Islamabad service with the Boeing 787 Dreamliner

ISLAMABAD: British Airways will resume flights to Pakistan next week a decade after it suspended operations following a major hotel bombing, becoming the first Western airline to restart flights to the South Asian country.

BA halted service to Pakistan in the wake of the 2008 Marriott Hotel bombing in the capital Islamabad that took place during a period of devastating Islamist militant violence in Pakistan.

Security has since improved, with militant attacks sharply down in the mainly Muslim country of 208 million people, reviving Pakistan as a destination for tourist and investors.

“The final touches are coming together for the airline’s return ahead of the first flight on Sunday June 2,” British Airways said in a statement. It will launch a three-per-week service to London Heathrow, it said.

“We’re on board,” Pakistani Civil Aviation spokeswoman Farah Hussain said about the flights resumption.

BA, which is owned by Spanish-registered IAG, will begin the London Heathrow-Islamabad service with the airline’s newest long-haul aircraft, the Boeing 787 Dreamliner.

At present, only loss-making national carrier Pakistan International Airlines (PIA) flies directly from Pakistan to Britain, but its ageing fleet of planes is a frequent source of complaints by passengers.

Middle Eastern carriers Qatar Airways, Etihad Airways and Emirates have a strong presence in Pakistan and have been eating into PIA’s dwindling market share. Turkish Airlines also lays on a regular service to Pakistan.

Islamabad has been running international advertising campaigns to rejuvenate its tourism sector, which was wiped out by Islamist violence that destabilised the country following the Sept. 11, 2001 attacks in the United States and the U.S.-led war in Afghanistan.

“We hope customers in both the UK and Pakistan will enjoy the classically British service we offer, with thoughtful bespoke touches,” Andrew Brem, Chief Commercial Officer at British Airways, said in BA’s statement.

BA said there will be a halal meal option in every cabin and the airline would also ensure sauces in every meal do not contain alcohol or pork.