Emirates Airline layoffs leave pilots & cabin crew at risk of imprisonment or Interpol Red Notices over debts & mortgages
Summary: Pilots and cabin crew faced employment culling with hundreds let go after coronavirus lockdown. Airline staff face imprisonment and Interpol Red Notices over credit cards, loans and mortgages accrued during their service in the UAE.
“It’s like a repeat of 2009, only worse”, said Radha Stirling, CEO of Detained in Dubai. “Last time the economy took a huge hit, pilots and cabin crew were amongst those most affected. Airline staff are actively targeted by big banks in the UAE for easy credit and mortgages, but for many, accepting these offers quickly backfired and turned into a nightmare.
“Dubai’s economy is fragile. Any world crisis is going to impact air travel and staff will be laid off promptly, especially in a country where tourism is a major economic contributor. The banks are aware of this, they’ve seen it time and time again, but they themselves get bailed out when they over expose themselves so there’s little incentive for them to be careful.”
“To customers, they claim the loans are covered by insurance so it appears quite risk free. If they are made redundant, the bank’s insurance will cover the debt. Why not take out a loan then? Why not take out a mortgage? It seems like a good idea and especially if they end up with a place in the sun!
“After the world economic crisis, customers were awoken to the brutal reality that the banks did not care if they were apparently covered by insurance or not. When a customer was laid off by their employer and subsequently pleaded with the bank for an empathetic payment break, they were met with hostile debt collection agencies like Tahseel, who were more than happy to push the defaults all the way to imprisonment which, in fact, is a swift process of only three months. Their thinking is that the threat of jail will sufficiently frighten any relatives who may be able to help the debtor prevent imprisonment.
“Of course, the threat of imprisonment only works when the customer remains in the country. 2009 saw a mass exodus of expats, dumping their cars at airports and even abandoning their apartments and villas. The future was uncertain, there was going to be no work and they couldn’t pay their obligations. Whether they left because they were going to become homeless, or whether it was because they knew they could be jailed, the effect on the banks was mass defaults.
“Those who remained in the country, gambled that they would find alternative employment before entering into default. It was a huge gamble and the economic impact of the cornonavirus lockdown has been predicted already to surpass the turmoil of 2009. Those who do choose to remain in the country, risk being travel banned over their financial obligations. Hundreds of expats have been travel banned in the UAE over bank debts and the problem is, their passports are confiscated, their visas expire and they have no legal permission to work. How is anyone going to repay a bank debt in this situation? They’re not! That’s why we have people like Jonathan Castle and Morag Koussa who have been stuck there for years upon years, separated from their families and at risk of homelessness.
“The UAE needs to reassess their approach to financial default. While I understand that loose credit regulations leave the banks open to deliberate fraud, most people are genuine with their intent. Keeping them, effectively prisoners in the country, is detrimental to its growth. It forces expats to abandon ship at the first sign of an economic downturn and the threat of jail means they can’t return if they are offered a new job later. It leaves Dubai counting on fresh blood to keep the wheels in motion, a bit like a Ponzi scheme. Eventually it runs out of steam.
“Expats don’t really feel longevity in Dubai, not when their security can be so easily ripped from beneath them at the click of a finger. This is something the UAE needs to work on if they want to attract leading talent on a longer term basis.
“Airline staff have already been laid off, with many more expecting to be next in line. Just in the past few days, I’ve received calls and emails from cabin crew nervous about what will happen next. They know they won’t be able to meet their financial obligations and face being out of employment indefinitely and are seeking advice on whether they will be listed on Interpol’s database as a fugitive. The answer is likely yes.
“Most business sectors are suffering from the worldwide coronavirus frenzy and prolonged lockdown and when they leave the UAE, and leave their mortgages, loans and credit cards, the banks will resort to secondary enforcement tactics. They’ve missed out on firing their primary weapon, that of jail, so will resort to their backup arsenal, harassment and the dreaded Interpol Red Notice; for pilots, this is a nightmare!
“Over the past decade, we have worked on unbelievable cases of criminal harassment from the banks and their agents. The extent that they are willing to go to is unfathomable to most, often even from branches of major international banks that would never be able to get away with this behaviour from their Western branches. The banks have either themselves, or through debt collection agencies, systematically harassed customers, their families and their new employers, often causing their termination, something one might consider counter-productive to recovering any monies owed. Nevertheless, they do not want a reputation for weakness to be perpetuated over the world.
“On occasion, banks have flown staff out to turn up in person and try to meet with a customer. Emirates NBD I recall, flew a manager to meet with an Emirates captain at an airport in Germany to discuss his mortgage. They wouldn’t negotiate a reduction in his payments and preferred to report him to Interpol’s database. Fortunately for him, he was not flying internationally at the time but was stunned when later, he became a simulator instructor in Madrid and one day, found himself in a Spanish police station wondering why on earth the policía were treating him like an international fugitive. Over a mortgage? Really?
“In Italy, an Emirates flight attendant was arrested on the basis of an Interpol Red Notice in Rome. She was detained for several days and processed for extradition, as though she were a mafia boss. Unbelievably, it was for a small credit card debt. She was placed under house arrest in a hotel, paid for by her, while she endured a lengthy trial. Ultimately, the extradition request was denied. But did the banks really want her returned to Dubai? No, they wanted to harass her and use the Interpol arrest warrant to pressure her into payments she simply couldn’t afford. If she couldn’t afford it then, she certainly couldn’t afford it after being slammed with legal and hotel bills. She is now awaiting to be removed from Interpol’s database and ridiculously, was just last week, surrounded by eight Italian polizia at a hotel restaurant because the notice’s removal is still being processed. She was mortified, embarrassed and rightfully angry at the bank. We are now looking at legal action against the bank. It is time they are made accountable.
“Interpol can take up to nine months or more to remove notices, and there are no checks and balances when a red notice is issued from the UAE. To fit in with their reporting rules, banks will change the category from “debt” to “fraud” to ensure their notice is listed. They are effectively using Interpol as their own free debt collection and harassment agent. We have made Interpol aware of abusive practices, but they are heavily funded by countries like the UAE and Qatar and currently have no disciplinary procedures in place for abusive member states.
“I fully expect to see a repeat of the devastation caused in 2009 and have cautioned expats to vacate the country rather than risking being jailed or travel banned. It is important to be proactive in addressing debt but, keep in mind, that the banks can be sneaky and once in default, they are no longer your friend. Once employment is terminated, bank customers should leave very quickly, before the employer notifies the bank. The mere notification of employment termination has caused banks to unfairly and suddenly call in loans or issue travel bans.
“Businesspeople are also advised that banks are prone to unfairly calling in loans, simply because they need to increase their cash reserves. This can cause businesses to default and travel bans be issued for the Directors.
Finally, those who stayed behind in 2009 in hope of salvaging their businesses or mitigating their exposure to banks, put themselves at risk of imprisonment for bounced cheques or defaults. There was no consideration for their goodwill and intents taken into account when they were sent to jail. Be diligent, foresee the risks and resolve business and finance issues from the safety of your own country.”
Detained in Dubai was founded in 2008, helping and advising people in financial and commercial matters, litigation, Interpol and extradition.