Fraudster, wife get 517 years in jail for ponzi scam

Dubai: The Dubai Misdemeanours Court sentenced two Indians to 517 years in jail each for swindling and deceiving thousands of victims in the $200-million Exential fraud case.

Dr Mohammad Hanafi, presiding judge of the special bench of judges, also sentenced the wife of one of the defendants in absentia to 517 years. She failed to attend the trial as she remains at large.

The defendants were convicted in the 515 cases that were lodged against them and as per Sunday’s judgement, they were sentenced to one year in jail each in 513 cases and two years in jail for the remaining two cases. It took presiding judge Dr Hanafi up to 10 minutes to read out the judgement in courtroom three, inside which tens of victims were present in addition to the defence lawyer.

According to the primary judgement, the defendants will also be deported.

Prosecutors accused the defendants of swindling, deception and conning people of their money and referred the case to the special panel on October 31.

The first hearing took place on December 25 last year and the trial concluded with the sentencing on Sunday.

The ruling remains subject to appeal.

A UAE lawyer representing a group of victims bilked out of investments in the $200-million Ponzi scheme said the sentencing of the two men behind the scam by the court to more than 500 years in jail may help recover some of his clients’ money.

Atty Barney Almazar, director of Gulf Law, is working with the Philippine Embassy to assist victims of the financial crime.

Almazar is the legal advocate of a number of Filipinos who invested in Exential. Many victims, including a group of 90 people, lost their retirement and life savings, others took out loans to be able to invest.

“The court decision of more than 500 years’ imprisonment sends a very strong message to the public that Dubai is not taking financial crimes lightly,” Almazar told Gulf News on Tuesday.

Many of the victims were also crew members working for Emirates airline.

“This judgement can be used to support the victims’ civil claims and efforts in locating the assets of the company. The decision will be acceptable in foreign jurisdictions. In any criminal act, the fruits of the crime are considered illegal and will be forfeited. The victims moved a step further to reach their objective to collect their investments. Of course, there is a process and this is not a guarantee,” Almazar said.

Exential disguised a Ponzi scheme as a legitimate foreign currency trading programme, offering up to 120 per cent annual returns on investments before their office was shut down by the Department of Economic Development (DED) of Dubai in July 2016.

Earlier reports said around 7,000 UAE residents lost their life’s savings in the scam.

Justice served

Some of those victims, who spoke with Gulf News on Tuesday, voiced some degree of satisfaction that justice had been meted out by Dubai courts.

“The news is overwhelming. Justice has been served. He [Exential chief Sydney Lemos] has to pay for what he did to us. The fact that he can no longer leave Dubai is well and good for us,” Gerry Sandique, 52, a technical consultant and one of the complainants against Lemos, told Gulf News.

Sandique invested $50,000 (Dh183,500) from savings and a personal loan together with his wife in Exential in November 2015.

“What we want to happen now is to recover our investments. There are people who have lost hope because of so many reasons. But we still hope to get our money back,” he added.

Another investor, Yuri Cipriano, a safety engineer, welcomed the court decision.

“This is a good development for all of us. But our main concern is still about getting back our investments. We hope the court could help give us formal guidance on how we can do this. We know people who have won cases in court against Lemos but have not received anything until now,” Cipriano said.

The soon-to-be dad’s heart bleeds with the mere mention of the amount of money he had invested at Exential — $50,000 plus the income it had generated for a total of $60,000.

“Just the thought of it all is very painful. It’s hard to accept. This money was intended for our house project. Or I’ve always wanted to get my master’s degree but I can’t right now, my hands are tied,” Cipriano said.

A Dubai-based airline employee who invested $125,000 on five accounts said Exential owners did not just steal money but also wrecked the lives of many investors.

“Many families and friendships were destroyed after investing in Exential. Many lost hundreds of thousands of dirhams, some millions. It’s sad because at this point it’s been two years since all this broke out and although we’re still hopeful, there’s no assurance from anyone that we will get our money back,” the 30-year-old investor said.

The employee also filed a civil case against Lemos and is waiting for the court decision.

“It pains me to say that in all of our hearings for the past year, not once did his lawyers appear. Just give what is due. All we want is what was promised to us that’s clearly stated in the contract.”

■ Exential Group took money from investors promising huge returns by investing the money in the foreign exchange market. In the beginning, investors were paid, but gradually the payments stopped. Investigations revealed that Exential owner Sydney Lemos transferred the money to Australia-based brokerage rm FC Prime owned by his wife Valany Lemos.

What is Exential?
It is the name of a corporate group of three companies called Exential Group that operated out of Dubai Media City until authorities sealed its offices in July 2016.

Progress of the case
Aer investors complained, the company’s operations were stopped in July 2016 and its top official arrested in Dubai – fiƒrst in late 2016 and again in early 2017. Recently, two main people involved in the case, including the top official, were sentenced to 517 years in prison in Dubai.

In numbers
• Dh1.1b is the value of the Ponzi scheme disguised as a forex trading programme 
• 7,000 UAE-based Exential investors were duped
• 120% Returns promised to investors on a minimum payment of $25,000