Bengaluru: As many as 20,000 people have filed a complaint in Bengaluru against a Gulf-returned businessman, Mohammed Mansoor Khan, who allegedly exploited their faith in Islam to swindle Rs 5,000 crore.
The Karnataka government has formed a special investigation team to probe the allegations even as mysterious audio clips purportedly featuring Khan seek to assure investors of getting their money back while accusing Congress MLA Roshan Baig of cheating.
“We have arrested seven directors of the company and they have revealed a lot of information about the scam,” said Bengaluru deputy commissioner of police (east) Rahul Kumar Shahapurkar. “We are now on the lookout for Mansoor Khan and expect to nab him soon.”
Khan has been on the run since 10 June and the company’s head office, IMA Tower, has been shut since then.
The promise of massive returns
Khan, who is believed to have fled India, has been running an investment company called I Monetary Advisory (IMA) since 2006. The firm began operations in the gold and diamond sector but eventually expanded into bullion trading, infrastructure, printing and publishing, healthcare, and perfurmeries among others.
Khan then fashioned a bouquet of attractive schemes — promising hefty returns to investments for marriage of a girl child, education of children and scholarship to study abroad — and made each investor a “sleeping partner” in the operation.
His primary target group was devout Muslims who subscribed to the Islamic belief that interest is “haram”. What he offered them instead was not profit off interest, but returns through other means: His company would buy cheaper gold and diamonds from abroad, then sell them in India on a profit, and distribute the proceeds.
People were told that they could invest with IMA — a minimum of Rs 50,000 and then its multiples — and expect monthly, quarterly and yearly returns of up to to 10-12 per cent. The firm also promised hassle-free withdrawals within 45 days.
At the peak of business, investors got a 7 per cent profit per investment on a monthly basis, but the money stopped coming in January 2019.
Bharathi, one of the victims, told ThePrint that she and her husband Afzal Mohammed invested Rs 3 lakh in IMA to fund their daughters’ education. In the first year, 2018, they earned a profit of Rs 80,000, but now they find themselves at sea.
“I told my husband that something was fishy [when the money didn’t come this January],” she said.
“I asked him to go to the IMA office to ask about the money. The directors sent him back after convincing him that it was a temporary setback… owing to the parliamentary elections… and dull business. We believed them,” she added. “Now they have duped us.”
Fatima, another investor, put in Rs 5 lakh for her daughter’s marriage.
“I invested in January, and have not got any money so far. They claim in their audio tapes that they will return our money, but not one person from their company is seen,” she said, while participating in a protest at the IMA office. “How will I get my daughter married? We have lost all our savings,” she added.
‘The need for Islamic banking’
The alleged scam comes just months after a similar swindle was reported from Hyderabad, where a woman named Nowhear Shaik was accused of amassing Rs 900 crore by duping thousands across India, the US and West Asia.
Former Rajya Sabha member Rahman Khan told ThePrint that it was necessary to set up an organised institution for Islamic or non-interest banking to help curb such fraud and help Muslims invest in keeping with the Sharia. Such a system, he added, was already in place in several other countries.
“I have been working with the government to introduce the concept of Islamic banking,” he said. “Such a window is needed because a fifth of India’s population subscribes to this concept.”