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Unveiled: Anatomy of Exential's forex rip-off; court orders company to pay investors

More skeletons tumble out as noose tightens around those behind Dh1.1 billion Ponzi scam

  • Locked. The Exential office at the Arenco Tower in Media City, DubaiImage Credit: GN Archives
  • Picture for illustrative purposes only
    Image Credit: File
XPRESS

DUBAI: A Dubai court has ordered Exential chief Sydney Lemos and his companies to pay back a group of investors who lost their hard-earned money in a Dh1.1 billion Ponzi scheme disguised as a foreign currency trading programme.

The verdicts come as a ray of hope for nearly 7,000 UAE-based Exential clients who had been left devastated having forked out a minimum of $25,000 (Dh91,500) to open a forex account with the firm’s Dubai Media City office after being promised fantastic annual returns of up to 120 per cent, and being assured of a "secure" investment vehicle.

Onus on firm owner

Hany Elsaid of Abdul Rahman Naseeb Advocates and Legal Consultants, who represented the investors, said: “This is a very heartening development because the court has placed the onus to return the money on not just the company but also its Indian owner. We have got favourable judgements in 15 different cases, including one where the court has found Sydney guilty.”

The verdicts have dealt a blow to Lemos, 36, who is in police custody since mid-January and faces a string of civil and criminal charges.

A case has also been filed against his wife Valany Cardozo Lemos, who was captured on CCTV entering Exential’s sealed office illegally last December 26 and carting away vital documents with the help of other staff.

On January 3, 2017, Valany flew to India and is now believed to be holed up in her hometown Goa. However, the chief accountant of Exential wasn’t that lucky. He was arrested at Dubai airport minutes before boarding a flight to India and is now in jail.

“The noose is tightening. Soon you will hear about an Indian chartered accountant and some influential businessmen who played key roles in the brazen forex scam,” hinted Elsaid.

Brokerage house under scanner

In another related development, a brokerage house listed with the UAE Central Bank has come under the scanner for its alleged involvement in the multi-million dollar scam.

Many victims told XPRESS they invested money in Exential on the back of its partnership with the brokerage house. “We thought our money was safe,” is the common refrain.

The brokerage house, now shut, has always tried to distance itself from Exential saying its name has been misused without its knowledge.

However, a damning report submitted by a financial expert assigned by Dubai Court to look into the allegation suggests the two firms were closely linked.

An ex-employer of the brokerage house said it shared a deep nexus with Exential.

“They were hand in glove. Exential piggybacked on the brokerage house to gain credibility. In return, the brokerage took huge amounts of money for lending its name. It was a convenient arrangement. But when the music stopped playing everything collapsed like a house of cards, which explains why after the closure of Exential, the brokerage house also downed shutters,” said the staff on conditions of anonymity.

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