Ian Hay Davison, Dealing with Dubai: The regulator's tale
In 2002 the Dubai authorities announced the appointment of a distinguished chairman to its financial regulator that would give credibility to the country's attempts to establish itself as the leading Arab financial centre. Just two years later he was fired. Now, for the first time, Ian Hay Davison gives a first-hand account of the events that led to his dismissal. In the following linked article, the current chief executive of the DFSA gives his response
JUST BEFORE CHRISTMAS 2001 I was invited to the Rubens Hotel in London's Buckingham Palace Road for breakfast. My hosts were Claude Smadja, a Swiss journalist and until recently secretary to the famous annual World Economic Forum in Davos, and Habib Mahloujhi, a young British-educated Dubai resident of Iranian extraction. Mahloujhi was then head of knowledge at the executive office of the Crown Prince of Dubai, HH Sheikh Mohammed. They told me of the executive office's plan to establish a regional financial centre in Dubai. It was to be called the Dubai International Financial Centre – DIFC for short. They were looking for a chief regulator. Did I know of anyone suitable?
Having retired from the Bank of England two years earlier, I was free and willing to undertake an advisory but not an executive role in the project.
During the Christmas break I took soundings from former colleagues at the Bank whose advice was that the project was worth a try. Crown Prince Mohammed and Dubai were in principle good things.
Having supervised regulation in insurance and stocks and futures markets and assisted in a regulatory role with the Bank, I had a particular range of experience that, given Dubai's need for a single regulator to cover all types of business, left me uniquely qualified for the role.