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29 March 2024

Gulf-Kerala investment scam turns ugly

Published
By VM Sathish

The wife of a distressed Indian businessman in the UAE has approached the Indian police seeking protection and recovery of huge amount of money that her husband and brother lost to a dubious ponzi scheme operation in which hundreds of investors from a small village in Kerala have become victims.

Kololambu is a small village in Edappal, Malappuram district, Kerala, home to thousands of Non-Resident Keralites (NRKs) working in the UAE.

Many of them have lost heavily in a ponzi scheme run by a group of NRIs from that place doing business in the UAE.

Among the worst hit are Abdul Razak and Kunju Mohammed, two villagers, doing business in the UAE, who have routed others investment through their real estate company.

Seenath Abdul Razak, wife of a UAE-based Indian businessman, Abdul Razak (42), said in a police complaint that her husband has been living in a very miserable condition in the UAE, after he lost several million dirhams in a ponzi scheme cheating by people from her village.

He has been unable to go out of his flat in Dubai, fearing creditors and the ponzi scheme operators have threatened to bomb his family back home, and forcefully withdrew cheating cases that he had filed in the UAE.

She said that her husband has been cheated for Rs100 crore (Dh73.6m) by three other businessmen from the same village.

She has approached the First Class Magistrate through the Kunnamkulam Police Circle Inspector, Malappuram, Kerala, seeking police protection and relief in the alleged cheating case, in which her husband has lost Dh73 million.

A copy of the First Information Report filed by the police, available with 'Emirates24|7' names three UAE-based Indian businessmen as accused — SH, HK, and HD owe Dh86 million to her husband and that they are threatening her and her family in various ways affecting their peaceful life.

Razak had invested his own money and routed many other investors’ money through his real estate company, Trueline Commercial Brokers and Trueline Real Estate, in the ponzi scheme, run by a group of Indians from Dubai and Abu Dhabi.

While Abdul Razak is absconding, to evade debtors and creditors, Kunju Mohammed, another family member is jailed in Abu Dhabi in a few cheque-bouncing cases.

The ponzi scheme operators have allegedly threatened to bomb their family back home and kill their four children, elderly parents and wife.

Many close family members, friends and acquaintances have invested in the ponzi scheme that offered a whopping eight per cent return per month.

Abdul Razak, told this website: “I had lodged a police complaint in Dubai to recover Dh86m. But they have threatened me with dire consequences including bombing my family back home to withdraw the case. Through the mediation of family friends, they agreed to pay Dh40m–Dh20m in 2011 and Dh20m by 2013.

“Since they failed to pay me Dh20m, all the cheques that I have issued are bounced. I did not canvass these investments, but people from my village voluntarily came and invested because the rate of return was very good.

“When the scheme collapsed, me and my brother in law ended up in trouble. We are the biggest losers in the scheme. Whatever money we had we gave to the affected people. I have sold all my property here and back home to settle dues. Now my 75-year-old father takes care of my family by driving an autorickshaw,” he said.

A major chunk of the money was invested in the scheme on behalf of other businessmen and investors from his village, Kololambu, in Edappal Panchayat Malappuram.