Qatar has requested that U.S. regulators investigate the U.S. subsidiary of the largest bank in the United Arab Emirates, accusing it of “bogus” foreign exchange deals planned to harm its economy as part of a blockade by Gulf neighbors.
The Central Bank of Qatar’s law firm wrote a letter to the U.S. Treasury asking it to investigate NBAD Americas, the U.S. subsidiary of First Abu Dhabi Bank (FAB) (FAB.AD), which is majority state-owned.
In another letter, the lawyers – Paul, Weiss, Rifkind, Wharton & Garrison – asked the U.S. Commodity Futures Trading Commission (CFTC) to investigate the possible manipulation of Qatar’s currency, the riyal.
The request for an investigation deepens the diplomatic issues that came in June when Saudi Arabia, Egypt, the United Arab Emirates (UAE) and Bahrain imposed an economic boycott on Qatar, accusing it of supporting Islamist militants and Iran.
“We believe NBAD has participated in an extraordinary and unlawful scheme to wage financial warfare against Qatar, including through the manipulation of Qatari currency and securities markets,” said the letter to the U.S. Treasury dated Feb. 26, which has been seen by Reuters.
“These actions should be halted immediately, and we ask that you investigate whether NBAD has directly or indirectly supported the manipulation of Qatar’s markets, including through NBAD America’s dollar-clearing or correspondent banking services in the United States,” the letter said.
FAB, which was created from the merger of First Gulf Bank and National Bank of Abu Dhabi last year, did not respond to questions about details of the allegations.
“As the UAE’s largest bank and one of the world’s largest and safest financial institutions, First Abu Dhabi Bank (FAB) works closely with all of its regulators in the markets in which it operates, to sustain and uphold the high standards of governance and regulatory compliance across the group,” it said.
The UAE government did not immediately respond to a request for comment.
A Qatari government spokesman confirmed the letters had been sent to U.S. regulators but declined to comment on their content. New York-based law firm Paul, Weiss declined to comment.
The U.S. Treasury and CFTC did not immediately respond to requests for comment.