International investment manager Eshara Capital and its senior executive officer/founder Alexander Guy have been fined by Abu Dhabi’s Financial Services Regulatory Authority (FSRA) for breaching its reporting requirements.
Based in the Abu Dhabi Global Market (ADGM), Eshara was granted a licence in May 2016 to manage a collective investment fund.
Head to head
Conflict arose between the regulator and the firm in April 2018 over its failure to submit audit reports and regulatory returns.
According to the FSRA, Eshara claimed that it had not submitted the documents because “an outsourced accountancy engaged by the firm had been required to travel unexpectantly for a period of time in the first half of 2018, causing the preparation of the firm’s financial statements to be delayed”.
At Eshara’s request, its financial services permission (FSP) was withdrawn on 15 January 2019.
Paying the price
The removal of its permission did not stop the FSRA from handing out financial penalties of $10,000 (£7,650, €8,852) to both Eshara and Guy.
Taking into account mitigating and aggravating factors, the regulator accepted that “Eshara did not appear to undertake any regulated activities over the period in which it was in contravention of the relevant reporting requirements”, the FSRA said.
But added that the company was aware it was in breach of its requirements and only appointed an auditor after it was prompted to do so by the FSRA.
Alexander Guy
As senior executive officer and licensed director of Eshara Capital, Guy was responsible for ensuring the firm complied with its requirements.
The FSRA described his conduct as “reckless”, adding that it “fell short of the standards reasonably expected of him as an approved person performing the controlled function of SEO for Eshara”.
The $10,000 penalty is to be paid on or before 14 May 2019.
Prior to setting up Eshara in Abu Dhabi in 2013, Guy was a partner at London-based investment management firm The TMJ Partnership.
Crude oil and ship captains
Eshara’s website is “currently offline for maintenance”, but states it will “be back soon”.
According to its LinkedIn page, it has a “world-class team of investment professionals all of whom have direct experience of working in New York, London and importantly the GCC region”.
The background story says the firm’s origins go back to Captain James William Guy who captained the British Signal in 1962, an oil tanker that will filled with the very first crude oil produced in the Emirates.
“53 years later, his grandson Alex Guy has returned to these shores with Eshara Capital”.
It goes on to say that Eshara means ‘signal’ in Arabic.
