Dubai Court Sets Aside Property Transfers in Dh19 Million Embezzlement Case

The Dubai Civil Court of First Instance has ruled that property transfers made by a convicted embezzler to his daughter cannot be enforced against creditors, ordering that the assets be restored to his name to facilitate recovery of outstanding dues.

The judgment relates to a case involving a former chief executive who was previously convicted of embezzling approximately Dh19.2 million from a company he once headed. The court found that he had transferred ownership of two real estate assets to his daughter through gift arrangements, in what it described as an attempt to place the properties beyond the reach of creditors.

The underlying dispute originated from a criminal case in which the executive and others were found guilty of diverting company funds through a fictitious development agreement. He was subsequently sentenced to 10 years in prison, ordered to pay back the embezzled amount, and directed for deportation.

Following the criminal conviction, the affected company obtained a civil judgment exceeding Dh19 million and initiated enforcement proceedings. However, execution efforts were stalled after it emerged that no assets were registered in the defendant’s name.

Subsequent inquiries revealed that in 2019, the defendant had transferred a luxury apartment and a residential plot to his daughter under gift contracts executed without consideration.

The court observed that the timing and circumstances of the transfers, coupled with the absence of other attachable assets, indicated bad faith and an intention to prejudice creditors. While it held that the gifts remained valid between the parties, it ruled that they were not enforceable against the claimant.

Accordingly, the court ordered that the properties be re-registered in the defendant’s name, allowing them to be attached and used for execution of the civil judgment.

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