The Financial Regulatory Authority (FRA) has initiated criminal proceedings, revoked a chief executive’s licence, and imposed a one-month ban on new contracts for a consumer finance company found to have exploited parents’ data to issue unauthorised loans for an international school.
The sweeping decisions, approved by Authority Chairperson Islam Azzam, followed a four-day intensive investigation triggered by circulating reports and subsequent official complaints regarding the credit ratings of affected parents. Technical teams from the non-banking finance, complaints, compliance, and anti-money laundering departments conducted on-site inspections and direct inquiries. In coordination with relevant authorities, the regulator successfully removed all negative impacts on the affected parents, cancelling the financial and credit liabilities wrongfully attached to them.
Based on the investigation’s findings, FRA suspended the company from dealing in finance products related to school fees and club memberships, prohibiting any new financing in these areas until a comprehensive regulatory review is completed. Furthermore, the regulator revoked the licence of the company’s chief executive for consumer finance and applied additional penal measures against several key employees for committing violations that harmed client rights under Board Decision No. 45 of 2026. The company’s general assembly has also been ordered to convene in the presence of an authority representative to address the violations and enforce stricter internal controls.
The disciplinary actions were taken in accordance with Article 22 of the Consumer Finance Law No. 18 of 2020. The company was found in breach of regulatory decisions concerning customer data inquiries, corporate governance, credit controls, and anti-money laundering protocols. The regulator noted that its administrative measures are separate from ongoing criminal investigations by the Public Prosecution, which has been formally notified of the incidents. The authority reiterated its commitment to protecting consumers from illegal practices and warned all regulated entities to strictly adhere to frameworks verifying customer identities and data accuracy under Board Decision No. 186 of 2024 and its amendments.
