£200m may have been lost (From Asian Image)

£200m may have been lost

3:00pm Wednesday 8th July 2009 in

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Dozens of Asian families across the North West fear they have lost fortunes in foreign investment schemes.

As much as £200m is believed to have been put into operations which promised speculators returns as high as 90% in 18 months if they invested in international projects - many in the Gulf states.

But in some cases profits have not materialised and worried investors are trying to get their capital back.

A Lancashire Police spokesman said the force was aware of the situation. He said, “Police in Preston have received two complaints from potential victims of fraud and the full extent of this fraud is currently under investigation".

Illyas Munshi Chief Executive of Enterprise4all Ltd, a regional business support organisation, warned of the dangers of people investing in anything without doing sufficient homework.

He said, “People have borrowed from friends and family, re-mortgaged homes and invested entire life savings into such schemes and are now paying a very hefty price.

“We have begun receiving correspondence from Asian Business Federation members highlighting how they have invested their personal and business wealth into these schemes and now do not know who to turn to.

“The sheer scale of the problem and amounts transferred is daunting.

“It has been raised from the Asian community across Lancashire.”

He said people were encouraged to invest by stories of how others had supposedly got substantial returns and got “caught up in euphoria that is generated”.

“Investors ignore the most fundamental principle of investment: “One cannot expect to make large profits without taking risk.

“Whenever a large amount of money is at stake, individuals should logically seek large amounts of information on where they should invest.

“But investors in this case did not.

“Few ask the right questions at the right time and are naive enough to believe in what is communicated to them. Indeed, many incidents do not get reported, as people do not like to admit that they have lost money.

Seek help “The fear is people are still waiting with bated breath for their returns but to no avail.

"The fear is the emergence of new schemes within the community.

“We have been hit already but a new set of investors is being approached.

“The scheme details might change, but the structure is the same.

“People should stay away or seek professional advice”.

“Most of the people getting sucked in are introduced to them by people they know very closely, relatives or a close friend, and there are even cases where some religious scholars have sanctioned investment practices as being satisfactory even though they contravene the basic tenets of faith.”

The investors One man, who said he staked more than a million pounds in a scheme, said: “We were promised a 90% return within 18 months. And at first many people did get paid out. There were never any concerns “In return for the investment we were given a letterhead with the company logo on it.

“Looking back it did not seem so unreal at the time. There were other trusted people we knew who were involved. And the people we gave the money too also seemed very trustworthy.”

Middlemen Another Lancashire businessman said he raised money and then found he had become a ‘middle man’ for an investment scheme.

“People came to us and gave us money to hand over.

“They effectively knew they were investing it elsewhere but the buck stops with us now.

“They are coming to us wanting the money back. So we are deeply concerned.

“We have been given cheques on various occasions but these have bounced.

“Now we have been told that the money will be given next year. And that will be the original investment only and not the profit."

We would like to hear from more investors who feel they may have lost money call 01254 298263 or 07747 488605 or e-mail news@asianimage.co.uk. All calls will remain confidential.