Investors of the Heera Islamic Business Group, better known as Heera Gold, are coming out in the open to protest delayed payments following a financial crunch faced by this Ponzi company. Last week, over a 100 victims of Heera Gold held public protests in Hyderabad along with victims and investors from other parts of India.
The protests were led by Shahbaz Ahmed Khan, who told Moneylife that over 200 investor victims have filed complaint against Heera Gold and its founder Dr Aalima Shaikh Nowhera (Nowhera Shaikh).
“Every day, I am receiving calls from panicky victims of Heera Gold from across the country seeking my help in recovering their investment. There are many who had invested more than Rs1 crore in Heera Gold and are now facing difficulties. They are neither receiving interest nor getting the principal amount back.” Mr Khan claims “the Heera Group and Dr Shaikh have filed around 17 cases against me, including defamation. I heard that they have got an injunction from the City Civil Court against me to prevent me from posting messages to highlight plight of victims on Facebook and other platforms. However, I am filing a writ petition against the injunction.”
He also alleges that due to the powerful political links of Dr Shaikh, the police are not investigating the matter or taking action against Heera Gold. He says, “Police are asking investors/victims of Heera Gold to go to the court claiming that this is a civil matter.”
However, a senior official from the crime branch, Hyderabad, who does not want to be named, refuted all the allegations made by Mr Khan about lack of investigation. He says, “So far, only one first information report (FIR) had been filed. That was also filed in 2012 and based on that we are investigating the matter. However, not many victims are coming forward to give any statement or evidence. Last week, there was one FIR registered at the Banjara Hills Police station and it is about to be transferred to the crime branch. Once we receive it, we will investigate the matter so as to take it to the right legal course.”
Mr Khan, however, presents another version. He claims that there are 200 investor victims, who are ready to record a statement before the police. “However, when somebody files a complaint, he or she is offered refund of their money by Dr Shaikh.” Mr Khan says that many victims are now ready to file a statement.
Earlier, in July this year, market regulator Securities and Exchange Board of India (SEBI) told Moneylife that activities of Heera Gold, are in the nature of Ponzi or multi-level marketing (MLM) scheme.
Replying to an email sent by Moneylife with videos of panicky investors, the market regulator’s Hyderabad office wrote to say, "Upon examination into the matter, it was found that the activities of Heera Group are in the nature of Ponzi Scheme. Further, the nature of activities of Heera Group was also discussed in the meetings of State Level Co-ordination Committees (SLCC) of Andhra Pradesh and Telangana, which are headed by Chief Secretaries of the respective states. It was decided in the meetings of SLCC that the activities of Heera Group appear to be beyond the regulatory ambit of SEBI and RBI and the case would be taken up for investigation by relevant authorities such as CID-EOW, and Serious Frauds Office of India (SFIO). Accordingly, SEBI had already referred the case to CID-EOW, Enforcement Directorate, Commissioner of Police-Hyderabad."
In August 2012, Asaduddin Owaisi, member of parliament (MP) from Hyderabad, had registered a case against Dr Shaikh for cheating a large number of local investors from his constituency. The Hyderabad Police are investigating this case.
On 10 September 2018, Farzanaunissa Mohammad Khaja filed an FIR under Section 406, 420 of Indian Penal Code (IPC) and section 5 of the Telangana Deposit of Financial Establishments Act, in Bajara Hills Police Station at Hyderabad. Ms Khaja has alleged in the FIR that her husband had invested Rs25 lakh in Heera Retail Hyderabad Pvt Ltd, but the company has refused to return her money. This FIR is most likely to be transferred to the Crime Branch for investigation.
This controversial and shadowy group has specifically targeted the Muslim community with the promise of high returns and constant references to ‘Allah’ to project itself as a devout and god-fearing organisation. The panic among investors over the past weeks is due to delays in making payments and a change in the payout dates.
In 2017, Dr Shaikh, CEO of Heera Gold formed the All India Mahila Empowerment Party under the banner of justice for humanity. This party even contested 221 out of the 225 seats in the recently concluded Karnataka Assembly elections with a 'diamond’ as its symbol. It is rumoured to have lost large sums of money. This and other rumours have triggered panic among people who want their money back.
Investigations and information by a premier government agency, perused by Moneylife, claim that Heera Gold is involved in hawala activities. The note lists various actions against the group. For instance, on 17 May 2014, the Hyderabad Police apprehended six accused, while Heera Group promoter, Dr Shaikh was named an absconding accused. Subsequently, on 21 May 2014, the Enforcement Directorate (ED) searched Heera Group premises and seized documents pertaining to the illegal transfer of money through hawala.
The Heera group began its operations in 2010 and since then, claims to have created 25 legal entities. Of these, only 10 were found to be registered on Registrar of Companies (ROC), Hyderabad and only four are found to have filed their balance-sheets (FY12-13), which are being analysed. It is not registered under Foreign Contributions (Regulation) Act (FCRA), says a government source.
A large number of PAN, TIN and other state-level registration numbers are shown on its website and are under ED and State Police investigation. These 10 companies have two sisters as Directors, namely, Dr Shaikh and Mubarak Jahan Shaikh. The third director (in only three companies) is another woman named Khamar Jahan Shaikh.
The group claims to operate through over 19 companies in various business sectors, like gold trading, trading, textiles, jewellery, mineral water, granite, tours and travels, developers, electronics, Hajj and Umrah services among others. Heera Group claims to have its offices in Dubai, Saudi Arabia, Canada, China and Hong Kong. It markets itself as a trader in gold products and gold dust.
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