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DFSA fines and bans senior executive of Morgan Gatsby

Chris Hamblin, Editor, London, 23 March 2020

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The Dubai Financial Services Authority has fined Mr Ajay Arora US$87,500 on many counts. One of his transgressions was to mis-classify a private retail client as a professional client; another was to fail to make the right enquiries about the sources of his funds.

These actions, according to the regulator, breached its conduct-of-business (COBS) and anti-money-laundering (AML) rulebooks. It also accuses Aurora of contravening its general (GEN) rulebook by failing to provide the firm's governing body with accurate information.

Morgan Gatsby peformed investment banking and underwriting services, giving advice about mergers, acquisitions and initial public offerings. These, by and large, were services for corporate clients but some of its private client services also fell foul of the DFSA's rules. The DFSA suspended its licence for a year on 8 November 2018. Among its reasons for this were Morgan Gatsby's inadequate human resources, particularly in the compliance area and including the compliance officer and money laundering reporting officer. It also broke the terms of an undertaking with the regulator, failed to comply with onboarding rules (including background checks and risk assessments for customers), mishandled clients' money and failed to run its own finances properly.

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