Learn More about False Allegations of Misappropriation of Money or Embezzlement in the UAE

Embezzlement under the UAE Penal Code

In common language, embezzlement is understood to mean a crime in which the embezzler legally obtains assets and then fraudulently appropriates them. Under the UAE Penal Code, the law on embezzlement is covered under the provisions related to ‘breach of trust’.

Article 453 of the UAE Penal Code, which relates to ‘breach of trust’, states that any person who has received movable property like money, documents or any other kind on the basis of a deposit, lease, mortgage, loan for consumption or agency, and he embezzles them in order to inflict damage to the rightful owners, the crime would be treated as a misdemeanour. Such person will be punished by imprisonment of up to 3 years or fine.

A person would be treated as an "agent" of another if he is a co-owner of the property, or the intermeddler managing the property or who receives the asset to use it for a specific purpose for the owner’s benefit.

Article 454 of the UAE Penal Code also states that, "any person who takes possession of lost property owned to another, with the intent to own it, or who knowingly takes possession of a property held by him by mistake or due to a force majeure, shall be liable to a jail sentence for a period not exceeding two (2) years or a fine not less than AED twenty thousand (20,000)."

Additionally, in accordance with Article 455 of the UAE Penal Code, "any person who embezzles or attempts to embezzle a movable property that he has mortgaged as a collateral for a debt in his liability or in the liability of another person, shall be liable to the penalty prescribed in the preceding Article. The same penalty shall be imposed against the owner appointed as a receiver on his own movable property under a judicial or administrative seizure, who embezzles any of the same."

False Allegation of Embezzlement

Having said the above, the UAE Penal Code also provides for a situation where a false complaint regarding a crime has been made to the authorities.

According to the Federal Decree Law No. 31 of 2021 On the Issuance of Crimes and Penalties Law, called the UAE Penal Code, if a person reports to judicial or administrative authorities, crimes knowing that it has not actually been committed, or accidents or risks which did not exist at such time, will be subject to penalties under Article 324. These penalties include imprisonment of up to 6 months and / or fines.

Article 324 of the UAE Penal Code has been set out below.

"Any person who reports to the judicial authority or administrative authorities, accidents or risks which do not exist at such time or contrary to the truth or who reports a crime knowing that it is not actually committed, shall be liable to a jail sentence for a period not exceeding six (6) months and a fine or either one of these two penalties."

Article 325 of the UAE Penal Code further states that if a person makes a false report to the judicial or administrative authorities in bad faith, accusing a person of committing an offence which could result in criminal or administrative action against him, he would be liable for imprisonment and fines.

If the fabricated crime results in conviction with the felony punishment, the false accuser will be sentenced to the same penalty as the victim convict.

Article 325 of the UAE Penal Code states as follows.

"Any person who, with bad intent, makes a false report to the judicial authority or administrative authorities, accusing a person of committing a matter which requires criminal or administrative punishment, even if such matter has not resulted in instituting the criminal or disciplinary action, and any person who creates material evidence to accuse a person of committing a crime contrary to the truth or causes legal proceedings to be initiated against a person knowing that he is innocent, shall be liable to a jail sentence and a fine or either one of these two penalties. A jail sentence and a fine shall be imposed in the two cases if the fabricated crime is a felony. If the false accusation results in a conviction with a felony punishment, the false accuser shall be sentenced to the same penalty imposed thereof."

Conclusion

Accordingly, if a person files a false complaint against you for embezzlement, knowing that it is false, you have recourse to the UAE Penal Code. At this stage it would be advisable to contact criminal lawyers to discuss the next steps.

Awatif Mohammad Shoqi Advocates & Legal Consultancy is a full-service law firm in UAE committed to delivering sound judgment to its clients on their most difficult and important matters.