DUBAI // Investors who have been duped out of hundreds of thousands of dirhams are targets of Eastern European criminal gangs, lawyers warned.
The gangs are looking to exploit people with huge debts who are on a list of vulnerable targets.
Many of the duped investors are Emirates Airline cabin crew members who invested in a foreign exchange scam that was shut down this summer.
They have been warned that criminals seek to extort money from them by offering new loans with high interest rates to pay off debts from borrowing to invest in the forex scheme.
Many cabin crew members were receiving returns from the forex scheme for years but payments began to dry up this year and stopped in June.
In July, when the Department of Economic Development shut down the offices of Exential Group in Arenco Tower, Dubai Media City, many investors were left with debts.
Each investor paid US$25,000 (Dh1,830) per forex account, with some holding several accounts after being promised annual investment returns of 120 per cent.
Carlton Huxley, a legal consultancy in Britain, is representing some Emirates crew members and is trying to recover funds through the courts.
It estimates that Exential Group has more than 6,000 forex accounts with more than $150 million in total.
“These people have no intention of helping you with the loan. These are Eastern European organised criminal gangs who specialise in loan-sharking, extortion, prostitution and people trafficking,” Carlton Huxley told investors in a letter.
“They intend to prey on already vulnerable and highly stressed people with a view to taking advantage of their predicament.
“If you invested, your details will be on a sucker list, which will be passed or sold on to others running similar schemes.”
Other “get rich quick” schemes in Dubai are trying to fill the gap in the market since Exential was shut down, and lawyers have warned prospective investors to be wary of investment schemes that seem too good to be true.
Dubai courts have ruled against Exential Group in what could be a landmark case and lead to some investors recovering some of their money.
Although that remains unlikely, MAD Advocates and Legal Consultants says the ruling could set a precedent.
Mohammed Al Dahbashi, managing partner of MAD Advocates, said his firm helped three clients secure court rulings for the full reimbursement of the money they were owed and legal interest of 9 per cent.
“For this one client, we have a judgement from the court granting that Dh500,000 be repaid,” he said.
“This decision came out exactly as we needed against all the Exential companies that we were able to identify through the documents exchanged between our client and Exential.
“The judge accepted to put all the companies involved under the same judgement. We identified three separate companies that were responsible.”
Exential Group has a 30-day period to appeal against the court’s ruling. The longer the court process takes, the higher the interest demanded for the funds to be reimbursed will be.
Businessman Peter Marpuri and his wife, an Emirates crew member, invested more than Dh650,000 with Exential Group, and are awaiting a court ruling that could help them to recover their money.
“We started investing in 2014, opening two accounts,” said Mr Marpuri, a Spaniard who works in publishing.
“It was going well. We were getting paid and so we opened more. We eventually had eight accounts.
“I lived in London for many years and have seen Ponzi schemes many times but didn’t suspect this as so many pilots and crew were already invested.
“We’ve had no payments since April. I feel bad, as many of my friends followed us and invested. It’s been stressful, we just want to move on.”
nwebster@thenational.ae
