A former senior executive officer and director of financial services firm La Tresorerie Limited, Gilles Rollet, was provisionally fined $175,000 and prohibited from holding office in or being an employee of a regulated DIFC entity, Dubai Financial Services Authority (DFSA) said in a decision notice today (1 November).
But the DFSA said Rollet disputes the DFSA's findings and has referred the Decision Notice to the Financial Markets Tribunal (FMT) where the parties will present their respective cases.
"The DFSA's decision is therefore provisional and reflects the DFSA's belief as to what occurred and how it considers Mr Rollet's conduct should be characterised.
The FMT will determine what, if any, is the appropriate action for the DFSA to take, and will remit the matter to the DFSA with such directions as the FMT considers appropriate to give effect to its determination. The DFSA's decision may be confirmed, varied or overturned as a result of the FMT's review."
The DFSA said it took action against Rollet due to its view that there were "multiple breaches of DFSA legislation arising from his knowing involvement in La Tresorerie unlawfully providing physical cash to its clients in breach of DFSA Rules (Unlawful Cash Service)".
Last year, Dubai Financial Services Authority (DFSA) imposed a fine of more than $600,000 on La Tresorerie after it identified a number of concerns relating to the company's cash services.
According to the DFSA, La Tresorerie, operated an illegal cash service for almost two years between February 2015 and January 2017. The company accrued fees worth approximately $220,000 from its activities, which included making use of fake invoices to transfer cash to customers, transporting cash to a foreign country associated with a high-risk of money laundering, and misleading banks about the nature and purpose of some transactions. The total amount of physical cash provided by the company under its cash service was in excess of $7m over 122 transactions.
The DFSA said La Tresorerie was responsible for a number of breaches of its rules and had "demonstrated a fundamental failure … to conduct its business with integrity". The regulator clarified that the breaches were not carried out under the company's current management.
Following a long-running investigation which began in 2017, the DFSA fined the company $612,790, including $261,154 disgorgement of the financial benefit it had received, plus interest. The DFSA reached a settlement with the company in relation to the findings of its investigation and the amount of penalty, although no settlement discount was applied to the penalty element of the fine.
In today's statement, the DFSA said the Unlawful Cash Service operated between February 2015 and January 2017 and involved, in its view: the use of false invoices and transferring client money to unregulated companies outside the DIFC; and the occasional transportation of physical cash from the UAE to a foreign country.
"It is the DFSA's view that Mr Rollet was knowingly involved in the Unlawful Cash Service because he authorised the service and facilitated it, at times through the use of his own bank account, and was directly involved in delivering cash to the firm's clients. The DFSA found that as the SEO, he was also ultimately accountable for the firm's activities."
Rollet denies all of the DFSA's allegations with regard to his knowing concern in the Unlawful Cash Service, the DFSA said.
"Further, in a voluntary interview with the DFSA in 2019, Mr Rollet provided information about his involvement in the Unlawful Cash Service that appears to be false, misleading and deceptive.
Mr Rollet also denies the DFSA's allegations as regards providing false, misleading or deceptive information to the DFSA."
The DFSA said it did not intend to make any further public comment until the FMT's review is complete, except as necessary to correct any inaccuracies.
