Breach of trust under UAE law is a crime under the Federal Penal Code committed when a person entrusted with money or property for a specific purpose misappropriates or misuses it for their own benefit. It is treated as one of the most serious crimes affecting financial trust and civil and commercial dealings between individuals and companies, and the UAE legislator has set out precise, decisive provisions to confront anyone who manipulates a position of trust or seizes funds entrusted to them.
The Legal Concept of Breach of Trust in the UAE
Under UAE criminal legislation, the crime of breach of trust is defined as the embezzlement, use or dissipation of funds, money, documents or other movable property delivered to the offender under a contract of trust, on condition that it be returned or used for a specific purpose, where the offender intentionally conceals or dissipates it to the detriment of the rightful owner.
The crime is not limited to individuals: it also extends to employment relationships, commercial partnerships and agency contracts, where a person is entrusted with certain funds or assets but exploits that trust to obtain an unlawful personal benefit.
The Essential Elements of Breach of Trust
For a set of facts to be legally characterised as breach of trust before the UAE courts, the following elements must be established:
Existence of a Trust Contract
The funds must have been delivered under a contract of trust — such as a deposit, loan for use, agency, lease, partnership or employment contract — so that imperfect possession of the property passes to the offender while ownership remains with its original holder, subject to clear terms for its return.
The Material Element (Dissipation or Embezzlement)
The trusted person deals with the property delivered to them as if they were its owner, refuses to return it when requested, or intentionally destroys it in a way that harms the rightful owner.
Criminal Intent
The offender must know that the funds belong to someone else and that they were delivered on a basis of trust, yet nevertheless intend to appropriate or dissipate them and deprive the owner of them.
Penalties for Breach of Trust Under UAE Law
Penalties imposed on offenders vary according to the gravity of the crime and the capacity of the offender:
Base penalty: Imprisonment or a fine, or both, for anyone who embezzles or dissipates funds or movable property delivered to them in trust.
Aggravating circumstances (occupational and professional breach of trust): The penalty is doubled or made more severe where the crime is committed by a public official, or by a person entrusted by virtue of their profession or position — such as lawyers, accountants or business agents — or where the crime causes serious harm to the victim.
Deportation: Where the offender is a foreign national, the court may order their deportation from UAE territory after the custodial sentence has been served.
Civil compensation: The victim is entitled to claim compensation for material and moral damage, in addition to recovery of the funds that were the subject of the crime.
How to Prove Breach of Trust and Protect Your Rights
To avoid legal disputes and ensure the ability to prove your rights in breach of trust cases, the following measures are recommended:
Document contracts in writing: Enter into clear, detailed contracts — employment contracts, agency agreements, receipts for cash or in-kind property — signed clearly by both parties.
Use official payment methods: Avoid handing over large amounts of cash without obtaining official, stamped receipts confirming the nature of the delivery and the trust involved.
Act quickly through the courts: File an official report with the police or Public Prosecution as soon as dissipation or refusal to return the trust is discovered, to preserve evidence and prevent the loss of rights.
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Conclusion
The UAE's legal system consistently affirms its commitment to protecting financial rights and safeguarding the rights of individuals and companies from all forms of fraud and breach of trust. Advance legal awareness and proper documentation of contracts remain the essential shield against complex legal disputes.
If you are facing a breach of trust dispute, or need to recover funds entrusted to another party, seeking specialised legal advice at an early stage can make a decisive difference to the outcome of your case.
Do not rely solely on the information available on the website; you should consult a lawyer to clarify many matters.