Abu Dhabi: Damas shares are expected to resume trading "in the next few days," a source close to the company told Gulf News Monday, a day after a market regulator fined Damas and its family owners Dh13.6 million and ordered that its board of directors be replaced for corporate governance violations.
A spokesman for Nasdaq Dubai said trading of Damas shares had not resumed Monday because the company had not made a formal application to lift a suspension it had requested the previous day pending the release of the Dubai Financial Services Authority (DFSA) investigation findings.
Damas officials were again unavailable for comment Monday. Damas shares last closed at $0.17 per share on Thursday, down 25 per cent since the beginning of the year and more than 70 per cent since March, 2009, according to Nasdaq Dubai data.
"They might be waiting to nominate the new board so shareholders would have something to look forward to," said an equities analyst, requesting anonymity.
Sunday's DFSA ruling mandated the resignation of the company's board within 30 days. The outgoing board is expected to make recommendations to the shareholders as to the appointment of new directors at a meeting to be held within 30 days.
DFSA director of enforcement, Stephen Glynn, confirmed yesterday his organisation had already referred the case to Dubai Police.
"DFSA does not have any criminal jurisdiction," said Glynn. "But there is an obligation under the federal penal code for us to refer activities of a suspicious kind to the police."
Case could go to court
Of the Dh13.6 million fine handed down by DFSA, the Abdullah brothers Tawhid, Tamjid and Tawfiq are responsible for Dh11 million, of which Dh1.1 million is payable within the next six months. The rest of the amount is suspended as long as the brothers meet their obligations to the company.
"The timing of the repayment is a matter between Damas and the brothers," said Dubai Financial Services Authority (DFSA) director of enforcement Stephen Glynn.
"The Abdullah brothers have undertaken to repay the amount owed to Damas and secured a pool of assets from which the company would be able to recover the amount owed," he said.
The value of the gold unaccounted for, at the spot price, when Damas released its semi-annual results in September 2009 was Dh231 million. Glynn said the value of gold has appreciated by 12 per cent since then, which would put the figure at about Dh259 million, according to Gulf News calculations.
"The DFSA does not have criminal jurisdiction in the DIFC. However there is an obligation under the Federal Penal Code for the DFSA to refer activities of a suspicious nature to the police."
