Abandoned luxury cars a growing problem in debt-ridden Dubai
Less than one year ago, photos of this Ferrari Enzo, the limited edition supercar, began circulating the web.
Why? Allegedly, the Enzo was owned by a British expat, who fell behind on his payments and was forced to flee the country.
You see, failing to pay your debts in the U.A.E. is a jailable offence, and it’s caused a growing problem that must be unique to Dubai: rich people, not nearly as much after the recession hit, have been forced to abandon their luxury cars en masse when they can no longer pay the bills.
Reportedly, high-end sports cars have been gathering dust at the Dubai and Abu Dhabi airports of late, and perhaps it’s no wonder why.
*Bing: How did Dubai go broke?
In the U.A.E., one of the hardest-hit areas by the downturn, at least among those that spend wildly outside their means, borrowers face especially harsh penalties for defaulting on loans.
Under Sharia law, practiced and observed across much of the Middle East, non-payment of debt can land you behind bars. Further, the U.A.E. has no bankruptcy laws, so there’s no protection against falling into debt, whether it happens beyond your control or not.
So what’s left, then, is a culture of panic, where consumers have overextended themselves on luxury cars and become unable to pay them off.
Expats, and even locals, too, are reportedly fleeing the U.A.E. and leaving their cars abandoned all over the city – in airport lots and on city streets. More than 3,000 were discovered last year alone.
“Many took out big loans to finance flashy cars to keep up with their peers,” one British expat told the Telegraph newspaper. “But when things slowed down they have struggled to make repayments and have fallen into debt.”
So far, luxury cars abandoned by their owners have been auctioned off at a great discount, but not every debt-soaked driver has been able to get away.
The Telegraph reports some expats have been forbidden from leaving the U.A.E. after being blacklisted for owing money.
By Jason Buckland, MSN Money