The Dubai Financial Services Authority (DFSA) has suspended the licence of Rasan Capital due to “serious concerns about the adequacy of its financial resources, its non-compliance with DFSA rulebook requirements and its failure to keep the [the regulator] informed and notified of such integral matters”.
According to its website, Rasan was set up in October 2017 and provides corporate finance advisory and investment advisory services to corporate and high net worth individuals.
Based in the Dubai International Financial Centre (DIFC), it was licensed to advise on financial products and arrange deals in investments.
Part of the Rasan Group, it has sister companies in the British Virgin Islands, Texas and Kuwait.
International Adviser reached out to Rasan Capital for a comment, but none was provided ahead of this article’s publication.
Compounding infractions
In June 2018, the firm notified the DFSA that it had fallen $61,000 (£48,646, €54,427) below its capital adequacy requirement of $109,000.
According to the regulator’s official notice, which is partly redacted, Rasan outlined various plans to inject capital into the business but failed to do so.
By January 2019, the capital deficit was $575,000.
On 25 April, the board and shareholders of Rasan signed a financial undertaking to increase the capital of the company by $2m.
But confirmed to the DFSA on 9 May that it had not been carried out.
Capital adequacy breaches played one part in the regulator’s decision to suspend Rasan’s licence, which was made for a number of reasons, including:
- Failure to maintain adequate resources to conduct and manage its affairs;
- Failure to ensure it maintained capital and liquid assets in addition to its capital requirements;
- Failure to keep the DFSA promptly informed of matters relating to its attempts to remediate its failure to maintain adequate capital resources; and,
- Holding client money in breach of conduct of business rules.
One year
The date of the decision notice is 12 May 2019, but the DFSA did not make the ruling public until 19 June.
As a result, the 12-month suspension will be lifted on 12 May 2020.
However, if the firm remedies its breaches to the satisfaction of the DFSA its licence can be returned sooner.
If it fails to do so, the DFSA may withdraw its licence or take “other such actions as it deems appropriate”.
