Dubai Imposes New Penalties on Financial Misconduct
In a recent development, Dubai introduced a new law designed to strengthen the accountability measures for employees within the Financial Audit Authority (FAA). Announced on Wednesday, Law No. (24) of 2024 - an amendment to Law No. (4) of 2018 - was issued by Sheikh Mohammed bin Rashid Al Maktoum, Prime Minister and Vice-President of the UAE, and Ruler of Dubai. This new law empowers the Director General of the FAA to investigate violations and administer disciplinary penalties as necessary, updating articles 34, 35, and 36 of the previous law.
New Powers for the Director General
The Director General of the FAA now has the authority to address potential violations among employees. If an offense is identified, disciplinary actions such as suspension, document confiscation, or dismissal of the case if evidence is lacking, may be taken. This decisive approach means that minor infractions can be handled internally, avoiding criminal prosecution.
However, if criminal activity is suspected, cases must be forwarded to the Dubai Public Prosecution for further action. The amendment specifies that measures like travel bans or asset freezes can last for up to three months and be extended if needed. After three months, employees may appeal these actions unless they have valid grounds for an earlier appeal.
Reaching Settlements
In cases where funds or profits gained through misconduct are fully recovered, a settlement may be reached, which would close the investigation. While the investigation may be resolved without prosecution, disciplinary action can still be taken against the employee, ensuring accountability without necessarily pursuing criminal charges.
Central Violations Committee and Grievances Committee
Under the new law, a Central Violations Committee will be created to oversee serious cases of non-compliance among senior officials. This independent body, comprising three members appointed by the Director General, will review cases where standard disciplinary actions have not been sufficient. Based on the evidence, the committee can adjust penalties, which employees or officials can then appeal within 15 days through a grievance process.
An additional permanent body, the Grievances Committee, will also be established. This committee includes a chairperson, a CEO from a government entity, and representatives from the FAA and the Supreme Legislation Committee, aiming to bring a balanced perspective to the final decisions. Decisions by the Grievances Committee are binding and cannot be appealed further within the FAA; however, employees can still pursue judicial recourse if needed.
Implementation and Transparency
This law is effective immediately and will be published in Dubai’s Official Gazette, setting a clear standard for FAA employee conduct while offering transparent procedures for appeals and accountability. With these changes, the FAA aims to uphold the highest standards of integrity, ensuring that employees are held accountable in a fair and structured way.