The financial industry needs a strong enforcer, says the Dubai regulator's chief, who wants to topple the crooks. The policy of naming and shaming is not going to take a back seat yet
A It has been a mixed year so far for Ian Johnston. On one hand, he got the top job at the Dubai Financial Services Authority (DFSA); on the other, his football club, Rangers, has lurched from one financial crisis to another.
"It's been painful,"says the Scot, referring tothe Glaswegian football club, not the DFSA. His progress through the ranks at the regulator has been impressively smooth.
Mr Johnston left his native Glasgow when he was 10 and headed to Australia with his family in one of the regular waves of emigration from Scotland. There he took up a career in financial services as a lawyer, and in 1999 "crossed the divide" when he joined the Australian financial regulator.
After a short stint in Hong Kong, he joined the DFSA in late 2006. "David Knott was the boss back then, and he wanted to bring in people with international experience to help establish our reputation. It was the early days of the DFSA back then," he says.
Last May, Mr Johnston was made chief executive on the departure of Paul Koster. The appointment ensured continuity in DFSA strategy, but Mr Johnston will bring a shift of direction to the role.
"I tend to put more emphasis on enforcement," he says. "I think it's in the interests of the financial services industry to have a regulator who's a strong enforcer."
It's a subtle but important difference. Since its inception in 2004 as the regulator for the Dubai International Financial Centre, the DFSA has been steadily building a body of codified regulation to govern the running of Dubai's financial markets.
Mr Johnston believes that the infrastructure is now in place.
"I think we'll slow down our rate of regulatory reform. The time is right for the market to catch up and take stock of where we are now," he says.
"It's far better to have somebody who goes in and takes firm action, but allows the other parts of the industry to get on with the job. If everybody is infringing, it usually means the policy is wrong," he adds.
Under Mr Koster - aided by Mr Johnston as managing director for policy and legal services - the DFSA was no shrinking violet.
The regulator took action against high-profile individuals and companies, including Barclays Bank; the Damas jewellery retailer; the investment bank Shuaa Capital; and the Dubai financial firm Capital Investment International.
"I think we've proved we are strong enough to go in and take action, even when it's against a group that has powerful local connections or is part of an international giant," says Mr Johnston.
He explains his philosophy for fighting financial breaches with the concept of a "regulatory pyramid". At the broad-based bottom are the "compliers", who will seldom breach the laws or regulations. The task in relation to these people is to "educate, so they know what the law is", he says.
Next, in the middle of the pyramid, are the "opportunists", who may breach the law when they have the opportunity. "For these, you have to monitor them to increase their fear of detection; this is a real deterrent," he says.
Finally, Mr Johnston believes, at the narrow tip of the pyramid there are the "crooks, for want of a better word. There may not be many of them, but they have to be stopped. That is where enforcement comes in," he concludes with a flourish.
Of course, as the scandal over setting of false interest rates by Barclays in the London money markets has shown, financial regulation these days is an international affair.
Regulators in Britain, the United States and Japan all cooperated in the Barclays investigation, and Mr Johnston is acutely aware of this aspect of his profession.
"There is a lot of interest in the DIFC from international institutions, especially from Asia, and we always take a careful approach as to which jurisdictions they come from. We will share information with regulators, for example in China or Hong Kong, before we allow a firm to branch in DIFC," he says.
Likewise, the new DFSA is also responsible for another global battle against financial crime in the shape of money laundering and terrorism funding.
"The regulator's role here is to detect where possible breaches have taken place, and report it to federal UAE authorities. The same applies to sanctions against Iran, which we treat very seriously. But I'm convinced that any serious money launderer would not try to do it via the DIFC," he says.
Naming and shaming is something the DFSA has made a positive policy, and this will continue under Mr Johnston.
"We will always publicise enforcement outcomes, even if we lose the case. But I don't believe in making that information public in the course of an investigation," he says.
He also believes the media have a vital role to play in alerting the public to financial malpractice and abuse, and to educate the public in sound financial management.
Now, if only an enforcer like Mr Johnston had been at the helm of Rangers, it might still be a thriving football club.
Changing visa rules
For decades the UAE has granted two and three year visas to foreign workers, tied to their current employer. Now that's changing.
Last year, the UAE cabinet also approved providing 10-year visas to foreigners with investments in the UAE of at least Dh10 million, if non-real estate assets account for at least 60 per cent of the total. Investors can bring their spouses and children into the country.
It also approved five-year residency to owners of UAE real estate worth at least 5 million dirhams.
The government also said that leading academics, medical doctors, scientists, engineers and star students would be eligible for similar long-term visas, without the need for financial investments in the country.
The first batch - 20 finalists for the Mohammed bin Rashid Medal for Scientific Distinction.- were awarded in January and more are expected to follow.
RACE CARD
4pm Al Bastakiya – Listed (TB) $150,000 (Dirt) 1,900m
4.35pm Dubai City Of Gold – Group 2 (TB) $228,000 (Turf) 2,410m
5.10pm Mahab Al Shimaal – Group 3 (TB) $228,000 (D) 1,200m
5.45pm Burj Nahaar – Group 3 (TB) $228,000 (D) 1,600m
6.20pm Jebel Hatta – Group 1 (TB) $260,000 (T) 1,800m
6.55pm Al Maktoum Challenge Round-1 – Group 1 (TB) $390,000 (D) 2,000m
7.30pm Nad Al Sheba – Group 3 (TB) $228,000 (T) 1,200m
BIGGEST CYBER SECURITY INCIDENTS IN RECENT TIMES
SolarWinds supply chain attack: Came to light in December 2020 but had taken root for several months, compromising major tech companies, governments and its entities
Microsoft Exchange server exploitation: March 2021; attackers used a vulnerability to steal emails
Kaseya attack: July 2021; ransomware hit perpetrated REvil, resulting in severe downtime for more than 1,000 companies
Log4j breach: December 2021; attackers exploited the Java-written code to inflitrate businesses and governments
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Sarfira
Director: Sudha Kongara Prasad
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Rating: 2/5
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- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
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- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
The specs
AT4 Ultimate, as tested
Engine: 6.2-litre V8
Power: 420hp
Torque: 623Nm
Transmission: 10-speed automatic
Price: From Dh330,800 (Elevation: Dh236,400; AT4: Dh286,800; Denali: Dh345,800)
On sale: Now
The BIO
Favourite piece of music: Verdi’s Requiem. It’s awe-inspiring.
Biggest inspiration: My father, as I grew up in a house where music was constantly played on a wind-up gramophone. I had amazing music teachers in primary and secondary school who inspired me to take my music further. They encouraged me to take up music as a profession and I follow in their footsteps, encouraging others to do the same.
Favourite book: Ian McEwan’s Atonement – the ending alone knocked me for six.
Favourite holiday destination: Italy - music and opera is so much part of the life there. I love it.
UAE currency: the story behind the money in your pockets
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Match info
Wolves 0
Arsenal 2 (Saka 43', Lacazette 85')
Man of the match: Shkodran Mustafi (Arsenal)
Learn more about Qasr Al Hosn
In 2013, The National's History Project went beyond the walls to see what life was like living in Abu Dhabi's fabled fort:
Dust and sand storms compared
Sand storm
- Particle size: Larger, heavier sand grains
- Visibility: Often dramatic with thick "walls" of sand
- Duration: Short-lived, typically localised
- Travel distance: Limited
- Source: Open desert areas with strong winds
Dust storm
- Particle size: Much finer, lightweight particles
- Visibility: Hazy skies but less intense
- Duration: Can linger for days
- Travel distance: Long-range, up to thousands of kilometres
- Source: Can be carried from distant regions
Tips from the expert
Dobromir Radichkov, chief data officer at dubizzle and Bayut, offers a few tips for UAE residents looking to earn some cash from pre-loved items.
- Sellers should focus on providing high-quality used goods at attractive prices to buyers.
- It’s important to use clear and appealing photos, with catchy titles and detailed descriptions to capture the attention of prospective buyers.
- Try to advertise a realistic price to attract buyers looking for good deals, especially in the current environment where consumers are significantly more price-sensitive.
- Be creative and look around your home for valuable items that you no longer need but might be useful to others.
UAE currency: the story behind the money in your pockets
Nepotism is the name of the game
Salman Khan’s father, Salim Khan, is one of Bollywood’s most legendary screenwriters. Through his partnership with co-writer Javed Akhtar, Salim is credited with having paved the path for the Indian film industry’s blockbuster format in the 1970s. Something his son now rules the roost of. More importantly, the Salim-Javed duo also created the persona of the “angry young man” for Bollywood megastar Amitabh Bachchan in the 1970s, reflecting the angst of the average Indian. In choosing to be the ordinary man’s “hero” as opposed to a thespian in new Bollywood, Salman Khan remains tightly linked to his father’s oeuvre. Thanks dad.
UAE v Gibraltar
What: International friendly
When: 7pm kick off
Where: Rugby Park, Dubai Sports City
Admission: Free
Online: The match will be broadcast live on Dubai Exiles’ Facebook page
UAE squad: Lucas Waddington (Dubai Exiles), Gio Fourie (Exiles), Craig Nutt (Abu Dhabi Harlequins), Phil Brady (Harlequins), Daniel Perry (Dubai Hurricanes), Esekaia Dranibota (Harlequins), Matt Mills (Exiles), Jaen Botes (Exiles), Kristian Stinson (Exiles), Murray Reason (Abu Dhabi Saracens), Dave Knight (Hurricanes), Ross Samson (Jebel Ali Dragons), DuRandt Gerber (Exiles), Saki Naisau (Dragons), Andrew Powell (Hurricanes), Emosi Vacanau (Harlequins), Niko Volavola (Dragons), Matt Richards (Dragons), Luke Stevenson (Harlequins), Josh Ives (Dubai Sports City Eagles), Sean Stevens (Saracens), Thinus Steyn (Exiles)
Tickets
Tickets start at Dh100 for adults, while children can enter free on the opening day. For more information, visit www.mubadalawtc.com.
