Regulation by the Dubai International Financial Center

I met my Singapore friend who now works in Dubai. He wanted to create a new product and get the approval of the Dubai International Financial Center (DIFC) to market the product to retail investors.

The DIFC asked many questions. They are hesitant about allowing the product to be sold to the retail investors, as the investors may not understand the risk. My friend decided to withdraw the application.

I believe that the DIFC approach is correct. It is difficult for retail investors to understand complex products that are designed by "financial enginners" with the aim to make profit for the financial institutions. The retail investors are likely to be "taken for a ride" by these "financial engineers".

This is a different approach from that taken by the Monetary Authority of Singapore.