Former Etihad Airways flight attendant jailed after unable to repay loan taken to invest in Bitcoin
A former Etihad Airways cabin crew member has been imprisoned for failing to repay a loan he used to invest in Bitcoin during the peak of the cryptocurrency boom.
The unnamed 34-year-old French national said he was jailed after losing his job in wave of COVID-19 related layoffs and becoming unable to service a 338,000 AED ($100,000) loan he took in 2017 to buy Bitcoin.
He says he was required to repay about $3,320 per month through the end of 2021 to settle the debt, a burden he could no longer meet after losing his income.
The situation is serious because failing to repay debts is a criminal offense in the United Arab Emirates (UAE), and debtors can face imprisonment for up to three years.
Detained in Dubai, he has received support from a British charity that assists in criminal cases in the UAE. The charity says it has seen stringent, at times harsh, measures taken by banks when enforcing the criminal provisions related to unpaid debts.
In the past, expatriates could often return to their home countries to renegotiate or settle debts with less immediate risk. But Radha Stirling, CEO of the charity, says there has been a rise in threats involving Interpol notices against expatriate debtors who leave the UAE to avoid unpaid loans.
“Using Interpol to detain and seek extradition of debtors to the UAE is not legal, but UAE banks know that most victims don’t understand how to challenge or avoid a Red Notice. In many cases, former expatriates only learn about Interpol alerts when they are detained at an airport,” Stirling explained.
The Etihad crew member’s story began in late 2017, when he secured the large loan from an Islamic bank in the Emirates to make his first Bitcoin investment. At that time, cryptocurrency prices were near all-time highs; within a year, he says his investment had lost roughly 85% of its value.
Reports in 2019 indicated that hundreds of cabin crew from regional carriers may have lost large sums in what was described as a Ponzi-style investment scam. Investors had reportedly been promised returns between 5% and 20% if they invested more than $100,000.
The coronavirus pandemic further exacerbated the situation by triggering widespread layoffs at Etihad Airways, leaving many former employees struggling with outstanding financial obligations.