DFSA takes action against Senior Executive Officer
The Dubai Financial Services Authority (DFSA) has accepted an Enforceable Undertaking (EU) from S Ravishankar Naidu, Senior Executive Officer (SEO) at Royal Shield Limited (RSL), an Insurance Intermediary licenced by the DFSA.
The EU resulted from the DFSA’s concerns that, with respect to RSL’s insurance business, Naidu failed to:
- Arrange re-insurance cover in accordance with a Client’s instructions and allowed incorrect information to be provided to the Client about their cover;
- Comply with the DFSA’s requirement that, as the SEO, he must be resident in the UAE;
- Ensure that RSL’s financial statements for the financial year 2014 accurately reflected the financial position of RSL; and
- Ensure that RSL had adequate systems and controls to undertake its Insurance Intermediation business.
As an Authorised Individual performing the licenced Function of the SEO of RSL, Naidu was ultimately responsible for the day-to-day management, supervision and control of RSL’s Financial Services activities. However, Naidu’s conduct fell short of the high standard expected of him. In particular, Naidu failed to act with due skill, care and diligence and take reasonable care to ensure that RSL’s business was organised so that it could be managed and controlled effectively.
In deciding to accept the EU offered by Naidu, the DFSA acknowledges that Naidu co-operated fully with the DFSA. Further, to resolve the DFSA’s concerns, Naidu has voluntarily undertaken to step down as RSL’s SEO and ensure that RSL appoints a new SEO.
Naidu will remain as a licenced Director and Controller of RSL, and he has agreed to appoint another licenced Director to RSL’s Board of Directors, so that RSL’s Board comprises of at least three directors.
Naidu also agreed to pay a financial penalty of $70,000 (AED 256,900) to the DFSA, of which $10,000 (AED 36,700) is payable on or by 6 June 2017. The remaining $60,000 (AED 220,200) is suspended indefinitely and becomes payable if Mr Naidu fails to comply with the EU.