How My Friend and His Dad Yahya Al Kodmani Stole My Dubai Company
When I was 27, I founded a company in Dubai with investors from Syria. They funded the full project and I owed them a personal loan for my share of 40%. This is the story of how my best friend and his dad stole my company and robbed me of my freedom for a year.
Yamen Al Kodmani of Flora Engineering (15%) and his father Yahya Al Kodmani of Al Darmaky (45%) conspired to defraud me with their attorney Firas Al Shoufi of Bin Sevan Advocates. Their actions showed that they were very methodical in their execution. This is because it’s not the first time they do this type of thing. To also put things in perspective, the Kodmanis and their attorney come from the same town, Suwaida.
After seeing this glowing profile about Yahya Al Kodmani on The National newspaper, I feel compelled to share the truth about him and his family. I would like to share my story so founders in Dubai and the region also learn from my mistakes.
Yamen was also my roommate in college and I thought we were friends. Unlike his father who is an intelligent man, Yamen is not so much. Our relationship changed when we became partners, and the friendship cooled a bit but it became very different when I was no longer captive to the personal loan I owed his dad. I paid it off through my dividends, while working at a very low salary, as many founders do. That personal loan hung over my neck like a sword ready to swoop any time. It was the one document that could potentially put me in jail. Or so I thought.
I keep meticulous records. I like my accounting clean and above board, following best practices. I’m actually really anal about it. Ask any accountant I’ve worked with and they will tell you two things: 1) I like things to be done the proper industry standard, 2) I can’t stand any delays in paying salaries.
For instance, when I had to choose an auditor I chose Ernst & Young. I paid more, much to my investors’ protest, because I didn’t want an unknown outfit that can do whatever you ask them to do (cook the books). I wanted it to be clean, so when we go talk to the banks for credit, things become easier.
We also were a hybrid company with staff working from different countries around the world, but substantial portion were based in Sudan. So much so that we rented office space to allow them to work from, because in some cases in-person made things easier for analysts. As they are remote workers and we did not have any business in Sudan, the company did not have any official or legal presence. We didn’t even buy computer equipment for staff, just like you wouldn’t for a freelancer you hire on fiverr.
Anyway, their pay was done through exchanges like Al Ansari Exchange and delivered to each individual by their name, with their identification verified, etc. It is honestly not an area I thought I would ever have to explain. Every month, our systems produce a report on how much work was done by everyone and payroll is prepared to send off. Yamen and I both have to sign off on it. Every month.
So, what did they do?
Refused to sign off on the annual audits under false pretense, conducted by EY.
Yamen kept saying he had questions and wouldn’t provide any feedback when asked by the accountant or even auditors. For those who know me professionally, I like to keep things organized and structured. He kept delaying things and I got frustrated and left it for too long. Mostly because when EY guys needed to complete their draft, they needed all our bank statements. One of our bank accounts is with RAKBank where only Yamen is the signatory. I had no visibility at all.
Yamen stalled and refused to provide RAKBank statements. I did not realize that this stalemate was all on purpose until much later on.
They then claimed that the salaries in Sudan are too high and that something was not right, demanding an external auditor to conduct an audit. This is not the first time Yamen voiced concerns over our Sudan operation. I also didn’t like it because of the unpredictability of power and other utilities. But it was a very cost effective way to retain great talent for a fraction of the cost. At the same time, it paid above average salaries for Sudan. It was a win-win, or so I thought.
When the auditors came in, I stayed out of their way and instructed the accountant to provide them with anything they ask for.
Then Yamen refused to sign off on the salaries for all our WFH (Work From Home) staff. As a hybrid company, that represented about half of our workforce. HE just wouldn’t do it. Just like that! Then he later changed his mind and paid those who are not based in Sudan. For 2–3 months teams in Sudan continued to work without pay. During Ramadan.
At the time, I couldn’t understand. I would say come and take a look for yourself, what don’t you get?
This is where it’s brilliant: Their lawyer said that freelance workers are not employees, because they either work for a Sudan licensed business or with a UAE visa. Therefore, they are fake employees and this money is going to me. The same attorney told me in his office that they are going to go through all the books with a fine comb and if there is anything to find they will find it. Then he added, “and if we find nothing, we can make something out of nothing.” That’s what he said to me, word for word.
At that point I resigned, since I was unable to run the business anymore. I wasn’t able to pay my staff and I was effectively castrated. The only thing to do was to resign.
You would think that record keeping and the fact that my partner was signing off on those payments every month, as evident by his ability to halt all payments would be obvious to anyone looking through the documents. But it was not obvious at all. No one understood that.
For example, any payment over 5k dhs required 2 signatories, with the exception of RAKBank where Yamen is the sole signatory. No substantial payment of any kind can be made without both our signatures.
I even collected evidence showing communication between Dubai staff and Sudan staff, and with Sudan staff and clients. The judge had no interest in that. Because judges have an extremely narrow view of the case. They only see the total value claimed.
So that’s a thing that was a huge learning experience. You may think that things are easy to prove, but they are not. I have emails and chats, but judges don’t want to look at them. That’s why they have experts who would then dig into the subject with knowledge and issue a report to the court.
As for their audit report, it was prepared by Sharjah-based Score Plus Auditing, which doesn’t appear to be in business anymore. They refused to share the report with me, calling it leverage.
Instead they used the report to file a lawsuit claiming that I embezzled 7m dhs. The bulk of that amount is based on Sudan salaries, and then other items like my entire salary. Just a really crazy claim after claim to make it hard for me to keep defending every point.
At first I thought they were just being stupid, because this stuff is so clearly false it’s comical. There was nothing funny about it. When a financial case gets filed, the court sees your risk based entirely on the amount claimed. So, they manufactured as many claims as possible to create as big a number as possible.
Why? Because at a certain point the judges refuse bail. They say, the amount is too high. You can either get bail at the claimed amount or you don’t get out.
During all this time, the prosecutors never called me and I kept asking and calling. In fact, at some point they would tell me the case has been transferred to different police jurisdiction and then back again. They then claimed to have attempted to reach me and call me but I never responded. That is patently false because it was all I can think about. I had no other business but this case. I was literally by my phone the whole time, waiting for that call.
Later in court documents, I saw that they had a phone number for me that I’ve never seen before. Keep in mind, Dubai police have all my details and information.. you know if they want to find you they will find you.
Here I honestly don’t know how that happened but all I can offer is speculation. My attorney had a strong connection to the consultant they hired to take over the business, Khaled Kamel of Maham Consutlting . I didn’t think much of it, but he also did not show or get back to me until one day before trial.
Khaled Kamel pretended to befriend me and told me that his role is to mediate and resolve any conflict between us. I later discovered that his role was to get as much information out of me, so they can take over the business.
My attorney, Ali Al Shamsi was not responsive. They never had any answers about the prosecutors or why they haven’t reached out to us yet. At the time, I just thought that they have so much more business they don’t care about my relatively small case. I had to hire a new lawyer one day before the trial. Now that I think about all this, I’m not so sure it was just bad customer service. But I have no evidence to suggest any foul-play, just a feeling that it doesn’t make sense.
What I do know is that it’s impossible that the prosecutor had the wrong number by accident. I know this now after learning about the low-level corruption at teaboy level that regularly and routinely happens at the police and prosecutor offices.
Oh yeah, Dubai Police and Dubai Prosecution have a huge corruption problem that I learned about much later on. It doesn’t happen at the top level, or at least I haven’t heard or seen anything like that. However, bribes happen all the time to make sure that a certain case ends up with a certain judge, or a piece of paper goes missing.. that type of thing.
This is how the case went to straight to court. As per UAE law, the prosecutors don’t have to interview the defendant in order to make a case. I was still very confident that this noise will surely fail. I was so confident because all of my record keeping was pristine.
Best in class accounting practices, remember?
My first hearing, the judge took in their evidence, the external auditors report claiming that I embezzled 7m dhs. I requested that the court appoints an auditor to independently evaluate the case, because that report is false. As per UAE law, such a report alone is not evidence because that’s a paid opinion.
Please remember that I am asking for a court-appointed expert that I have to pay for. I am asking the court to allow me to pay a financial expert of their choosing to evaluate the case in detail and issue an expert opinion.
I had parked valet that day, and remember not feeling too well and just wanting to go home. To my surprise, the judge decided that he had enough to sentence me to 1 year in prison for embezzlement 2 hours after my case went up on the docket for the first hearing.
I was shocked. The judge did not think I deserved any due process or the chance to defend myself. He just threw me in jail like a candy wrapper in a trashcan. I could not believe it, and proceeded to apply for bail.
Ooops! No judge will grant bail at such a high amount.
I spent the rest of the year 2018 in Dubai Central Prison, fighting my appeal case. I had to somehow manage to collect documents and information for my defense, from behind bars and no access to my business.
I had to hire an expert to produce my own report to counter their false claims. This cost me 25k dhs alone. Had I been able to have that report prepared before my first hearing, it may have made the judge approve appointing an expert from the court. That’s what they tell me after the fact, but I honestly don’t know if that would be true.
Not to mention that since the prosecutors never reached out to me, I have never seen the actual report they submitted or the details of what I was accused of. Since everything is fiction, I could not have guessed what else they included.
By UAE law, my sentencing was illegal. But it happened anyway. And judges break the law allllllll the time. All you can do is appeal.
The appeals judge finally approved appointing an auditor from the royal court to evaluate and prepare his own expert opinion. I remember everyone in prison told me that I ended up with the toughest judge of all. I spent the rest of the year chasing this process, until the expert report came out and said that there is no embezzlement.
When the it was time to rule, the appeals judge ruled that I am innocent. I was released from prison 2 weeks LATER than I would have had I been guilty. Had I been guilty, I would have been deported on my last day, but because I was to be re-processed back, I spent 2 additional weeks wrongly imprisoned. If that does not make you wanna scream, I don’t know what does.
You know what’s messed up? Not a single soul in Dubai Central Prison or the prosecution or the court has uttered a kind word to me. They treated me like a criminal until the very last second. No one said, sorry. Instead, they demanded I stay in Dubai until the grace period to appeal the ruling to the supreme court. I had to wait, with no job, nothing to do. I just sat there waiting so I can leave from one prison to another.
Dubai, that was truly unfair.
Today, I still own my 40% but without any access to the company. I have not seen a single bank statement since 2018. The auditors have changed to HAM Auditing, but I have never been in contact with them and they never asked me to even sign off on my directors’ account like we normally would during any audit. They don’t respond to my shareholder meeting notices. And they can do that because they have majority control.
Here are some key learnings I would like to share:
- If an investor wants controlling majority, that is a bad investor. I know that when you are really trying to start and find money you convince yourself it’s a good deal.
- If things get sour and they demand an audit, retain an attorney immediately. You must conduct your own audit report in preparation for a storm. Later, you may not have access. Collect all the data you can while you do.
- Whoever has controlling majority can do whatever they want and there is absolutely nothing you can do about it. What you can do is create noise by sending court demands for financial reports. They will provide you with whatever they want and there is nothing you can do about it.
- Courts don’t understand business. WFH staff, hybrid, Internet-based work.. they don’t understand any of that. All they know is labor contract, lease contract, visas, how much in total. Don’t think that they can recognize that the external auditors are a shady outfit from Sharjah and my auditors are EY. They don’t know any of this. They just know, “he stole $$$”.
- Don’t think your staff that you hired yourself will stand up for you. They will not, because they want to keep their salary. Loyalty is only a birthday card deep.
- The first instance court doesn’t follow the law and they do this to meet KPI’s like how many cases resolved. The judge typically rules based on whatever the prosecutor says and lets you worry about it in appeals court if you want a proper hearing.
- In fact, the judiciary is not independent from the prosecution to the point where judge visas are issued by the Public Prosecutor. The prosecutor and the judge sit on the same side, facing you. I don’t know about you, but I can imagine judges not wanting to upset their sponsor. Only Appeals court judges are immune and held in high esteem.
People may like Dubai Police when they see them in public, but it’s a different world once you’re in the system. It’s a system designed without an exit strategy.
This is my story and this is my truth. Yahya Al Kodmani and his son Yamen Al Kodmani defrauded me and still continues to have control over my company. Their attorney knowingly falsified evidence and admitted it to me. They are all free men, still.