SECP issues warning on scam real estate schemes
ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has raised concerns over a rising number of complaints from individuals, particularly senior citizens, who have lost their savings to deceptive real estate investment schemes.
According to the SECP, these schemes typically lure investors by promising high returns on deposits, often misusing company registration and tax certificates to appear legitimate. Fraudsters collect substantial amounts from the public under the guise of investing in real estate projects while promising unrealistic monthly profits.
The perpetrators operate by channeling funds into accounts of unincorporated entities while using registered companies as a front to attract investors. These schemes often follow a Ponzi structure, where early investors receive returns, but eventually, the system collapses, leaving later investors with no means to recover their funds.
SECP emphasized that merely registering a company does not grant it the authority to collect illegal deposits or guarantee profits on real estate investments.
To safeguard their assets, the SECP urged the public to be highly cautious and avoid falling for schemes offering lucrative monthly returns.
“SECP further clarifies that it does not regulate real estate investment schemes except for Real Estate Investment Trusts. Any suspicious real estate investment activity should be immediately reported to law enforcement agencies,” it added.
