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UAE fintech Sarwa has been fined a total of $303,000 by two regulators for offering shares or securities without an approved prospectus.
Dubai Financial Services Authority (DFSA) fined fintech Sarwa Digital Wealth Limited (Sarwa DIFC) AED 702,000 ($191,000) for making a public offer of shares without an approved prospectus.
Abu Dhabi’s Financial Services Regulatory Authority (FSRA) fined Sarwa’s capital-based entity $121,500 for making a public offer of securities without an approved prospectus.
The DFSA said the fine had been reduced from AED 1.432 million as Sarwa halted the share sale and returned monies once it was advised that it may contravene the authority’s law.
Meanwhile the FSRA said Sarwa agreed to settle at the earliest opportunity and therefore qualified for a discount on the financial penalty, and a further reduction was given due to action already taken by the DFSA.
The sale was offered by email by Sarwa Digital Wealth (BVI), the parent company of both the Dubai and Abu Dhabi entities, and was sent to 100,000 users, resulting in $2 million being received into an escrow account from 150 potential investors.
The DFSA also found that Sarwa DIFC withheld financial information that would have been included in an approved prospectus and provided positive metrics that gave potential investors a misleading impression about the financial performance and position of Sarwa DIFC and Sarwa ADGM, collectively referred to as Sarwa.
(Reporting by Imogen Lillywhite; editing by Seban Scaria)
