Investigators examining alleged wrongdoing at once high-flying UAE healthcare provider NMC Health are exploring whether the company falsified drug orders to inflate the books of a related company through which NMC raised debt, the Financial Times reported on Monday (Aug. 10).
NMC Health was the largest private healthcare provider in the UAE and a darling among London Stock Exchange shares before “it collapsed spectacularly earlier this year as it disclosed billions of dollars in unreported debt,” the Financial Times reported.
Today’s Financial Times article states: “NMC allegedly used fake documents to simulate orders for pharmaceutical supplies from Neopharma, and its joint venture Nexgen, to obtain credit from banks and factoring agents that financed the fabricated sales. Thousands of irregular financing transactions amounted to more than six times the value of Neopharma’s real sales, the documents claim.”
Reuters reported last month that NMC’s troubles come at an especially difficult time in the UAE as the country’s government seeks to ensure that healthcare services continue uninterrupted during the COVID-19 crisis. According to Reuters, NMC operates more than 200 facilities in the UAE.
Al Jazeera described NMC’s rise and fall as “a story of a financial scandal, of fortunes won and lost and political collusion in the United Arab Emirates (UAE) that goes right to the heart of Emirati business and politics.”
The company was founded by Dr. BR Shetty, whom Al Jazeera describes as an “Indian billionaire tycoon.” At its peak, the company had more than 20,000 medical staff in the UAW, Spain and England, per the news outlet. Pertaining to NMC’s collapse, Shetty has said he was unaware of the alleged wrongdoing that had come under public scrutiny.
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Experts say that while electronic systems make it harder in some ways to conceal accounts payable (AP) fraud, they also can bring their own problems, such as the speed of transactions. And in some cases, one expert warned, remote-work arrangements set up to cope with COVID-19 are producing their own problems.
