Bank of Oman under fire over secrecy laws
Rhys Jones Oman’s Shanfari Group filed its third lawsuit in a month against the controversial National Bank of Oman (NBO) last week. The Muscat-based company claims that NBO is in breach of client confidentiality laws on two counts.
Oman’s Shanfari Group filed its third lawsuit in a month against the controversial National Bank of Oman (NBO) last week. The Muscat-based company claims that NBO is in
breach of client confidentiality laws on two counts.
The Shanfari Group alleges that after NBO agreed to help sell some of the company’s properties, the bank handed over confidential valuation reports to potential buyers. As a result, the company claims that this action has dramatically reduced the value of the properties.
Valuation reports typically contain two separate figures. One is what the property would fetch in the open market assuming there is a normal willing buyer and a willing seller, and the other is what would happen in the event of a forced or distressed sale.
“They (NBO) have actually handed over copies of the valuation report to potential buyers, which is not authorised,” said Adil Shanfari, vice chairman, Shanfari Group. “The result is that potential buyers have taken the lower of the two valuations, which is a forced sale value, and are saying ‘how much are you willing to discount on this price?’ That has dramatically reduced the valuation of the properties,” he added.
The Shanfari Group also alleges that NBO mishandled the company’s confidential financial statements. The Shanfari Group claims it gave NBO a set of its financial statements, which is normal practice in any bank-client relationship, and later discovered that the documents had been faxed to the UAE and then back to Oman.
The Shanfari Group says it discovered by chance that the statements had been faxed to the UAE when NBO’s lawyers accidentally attached a copy of the fax, which was sent from the Millenium Hotel in Abu Dhabi, to a petition to a court in Oman.
“For some very strange reason our financial statements were
faxed from the Millenium Hotel in Abu Dhabi to the NBO,”
“We thought ‘what’s happening here?’ Firstly, our transaction with NBO was within Oman and no-body in Oman should be allowed to take our financial statements outside the bank. This seems to be a breach of confidentiality and we are filing a suit against NBO for the bank conducting its affairs
in a less than professional way,” he said. This latest lawsuit follows two others filed by the Shanfari Group against NBO, one in December of last year and one earlier this month. Both related to other disputes between Shanfari Group and NBO.
NBO refused to comment.