Business partner set up a company in his name for me to operate, took the money, now threatening me -- UAE. What are my options?
Looking for advice on a messy situation in Dubai. Throwaway for obvious reasons.
A contact of mine agreed to register a company (e-trader license) in his name in the UAE, with the understanding that I would operate it, use the bank account, collect payments, and run the business day to day. He would receive a fee for this. The arrangement was verbal but supported by months of conduct -- he set up the account, gave me full login credentials to the business bank account, and received payments from it on my behalf with no objection over several months.
The company received a large payment from a client. Before I could move the funds to pay an outstanding invoice to a supplier, he transferred the bulk of the money out of the company account to his personal account without telling me. When I confronted him he first denied knowing anything about it, then claimed someone else had accessed the account, then eventually admitted he has the money and said it is his account and his rules.
I have all of this documented in WhatsApp messages including the progression from denial to admission.
There is now an outstanding unpaid invoice from the supplier of AED 72,500 that the company owes, for services that were rendered and received. The supplier is pursuing the registered owner since he is the legal representative on the trade license.
He is now demanding I return access to the company account, which I have not done since he has not returned the funds.
A few questions:
1- Given he voluntarily gave me login credentials and was aware of all transactions over several months without objecting, how exposed am I legally in the UAE?
2- He is the registered owner but I was the operator -- does the unpaid supplier invoice fall on him legally or could it come back to me?
3- He is now implying he will file a police complaint. Given his own conduct is documented, how realistic is that and what should I do to protect myself?
4-Has anyone navigated a nominee company arrangement gone wrong in the UAE and what was the outcome?
Not looking to do anything aggressive, just want to understand where I stand before deciding next steps. Any UAE-based legal perspectives especially welcome.