SEC Charges Dubai-Based Advisory Firm and Its Founder, Arif Naqvi
On April 11, 2019, the SEC charged Arif Naqvi and Abraaj Investment Management Limited, a Dubai-based investment advisory firm, with misappropriating funds from a private equity fund client.
The SEC alleges that Arif Naqvi and his firm raised money for the Abraaj Growth Markets Health Fund (“Health Fund”), collecting more than $100 million over three years from U.S.-based charitable organizations and other U.S. investors. According to the SEC’s complaint, Arif Naqvi misappropriated money from the Health Fund and commingled the assets with corporate funds of Abraaj Investment Management Limited and its parent company, and used it for purposes unrelated to the Health Fund. The SEC alleges that Arif Naqvi and his firm made misrepresentations to investors and issued false and misleading financial statements to hide that they were spending investor money in unrelated ways.
The SEC’s complaint, filed in federal district court in Manhattan, charges Arif Naqvi and Abraaj Investment Management with violating the antifraud provisions of Sections 206(1), 206(2) and 204 of the Investment Advisers Act of 1940 and Rule 206(4)-8 thereunder. The SEC seeks permanent injunctions, disgorgement plus interest, and penalties.
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