Can Heera investors get their money back?

UAE lawyers discuss the legal options available to victims of the Ponzi scheme

What are the odds of Heera Group investors in the UAE recovering their money? If the experience of other recent Ponzi scheme victims is anything to go by, then the chances are remote.

Hundreds of UAE investors have been left in the lurch following the arrest of Heera Group’s managing director Aalima Nowhera Shaikh in India earlier this month.

The 45-year-old has been charged with cheating, criminal breach of trust and criminal intimidation for peddling Ponzi schemes as halal investment programmes.

Even as investigators try to fathom the scale of the fraud, the question uppermost in the mind of UAE investors is: What should they do next?

Advocate Saad Mohammad Salman of Mohamed Salman Advocate and Legal Consultants said victims can either lodge a formal police complaint or hire a lawyer to press criminal charges against the company’s branch office in Jumeirah Lakes Towers.

“However, criminal charges won’t be enough to recover the money. A civil suit needs to be filed. It’s an expensive proposition as the claimants have to pay a deposit of 6 per cent of the total claim, or a maximum of Dh40,000. They also have to factor other expenses like legal fees, cost of translation etc. So yes, the road ahead is fraught with challenges,” he said.

Ashish Mehta, founder and managing partner of law firm Ashish Mehta & Associates said investors should be realistic in terms of recovering their investments. “If Heera Group is not licensed by UAE authorities to raise funds from third parties, then it is unlikely to have placed any financial guarantees/deposits with the regulatory body in the UAE. If this is the case, then investors can’t stake a claim for the guarantee money.

“Also, if the limited liability company doesn’t have any assets, then investors should evaluate whether they want to initiate a civil claim against the company. Investors may also consider filing criminal charges against the office bearers of this limited liability company if there are grounds to accuse them of cheating, fraud and, perhaps, breach of trust. However this matter needs to be studied in detail by a legal practitioner first.”

Dubai-based legal consultant Yasmine Khan said the chances of recovering money lost to “premeditated schemes” are slim. “However taking precautions and doing due diligence could assist in identifying the perpetuators and exposing them,” she said.

Meanwhile, Indian authorities have filed a petition seeking 14-day custody of Shaikh. According to police, she started the Heera Group by collecting deposits in 2010.