UAE- Estate agent S&K defied order to shut down

(MENAFN- The Arabian Post) An estate agent and property management company that went out of business last month was given a series of warnings and fines before regulators finally revoked its licence and ordered it to close.

S&K, also known as Smith & Ken, continued operating for more than a month in defiance of the closure order. It eventually ceased trading on July 21 and filed for bankruptcy. More than 80 staff, mainly in Dubai but also in Los Angeles, lost their jobs. Many say they are owed unpaid salary and commission.



Some of S&K's clients are also out of pocket. They say the company routinely asked tenants to make rent cheques payable to S&K instead of to the landlord, and asked property buyers to make cheques payable to the company instead of the seller. S&K then banked the cheques and retained the funds.

"This a violation of the laws," said Marwan bin Ghalita, chief executive of the Real Estate Regulatory Agency, the regulatory arm of Dubai Land Department. Rera is preparing a report on complaints by people who have had dealings with the company to guide them towards resolving their grievances.

"Some time ago, we received numerous complaints on the activity of this company and had been meeting with officials and the owner, and sent warnings several times," Mr bin Ghalita said. "We fined the company, but with continuous violations and non-compliance with the pledge by the owner, the company's headquarters was shut down on June 14 in cooperation with the Department of Economic Development."

Despite the order to close, S&K continued to trade. Staff finally found out they had no jobs when they turned up for work on July 22 to find signs on the office door saying S&K was no longer in business.

A few days later police were called to investigate vandalism when the glass door to the company's office in Concord Tower in Dubai Media City was smashed.

Among clients counting the cost are Mr and Mrs Anderson, who own a property in Jumeirah Village Triangle that was rented out through S&K.

"We have lost our tenant's security deposit of Dh6,500 and the Dh1,940 which S&K made us lodge with them for petty cash expenses," said Mrs Anderson.

"S&K should have returned these funds to us when we terminated the contract citing five contract violations, but they haven't.

"They wrote to us saying we would be paid when the last rental payment was due in March. There is no sign of any payment and no response to emails or phone calls."

Another landlord, Matthew Blair, used S&K for one rental term on his apartment in Dubai Sports City, which ended in February. He says S&K have held a security deposit of Dh5,000 plus a float of Dh1,000 to use against small repairs.

"I've been trying to get that money back," he said. "There was a series of phone calls to the company and to Rera.

"I understand that nothing should be held by the agent. That security deposit should be given to the landlord."

Other landlords who dealt with S&K were told rent payments had been delayed because the company's chief executive, Ben Smith, was the sole cheque signatory and was often out of the country.

Carlos Cruz, a former lettings negotiator at S&K, says he is owed Dh55,000 in commission from rental agreements at The Meadows and Jumeirah Islands communities.

The chartered accountancy Mashal Al Zarooni is the liquidator for all companies in the Dubai Free Zone, but no formal appointment has yet been made.

S&K said it had no further comment. Mr Smith, the chief executive, is thought to be in Los Angeles.