At least $150M was invested by persons into what appears to be a fraudulent vegetables export scheme, a police source said yesterday.
However, many investors have refused to give statements to the lawmen, this newspaper was told. Up to yesterday afternoon, the man suspected of perpetuating the fraud, remained in custody at the Brickdam Police station and according to reports is likely to be charged with fraudulent conversion.
The suspect, who is reportedly attached to a state agency, was taken into custody on Sunday following a report made. In the case, which has the outlines of a ‘Ponzi scheme’, the South Ruimveldt resident offered a 35% rate of return monthly if persons invested their money into his vegetable export ‘business’. Hundreds of persons invested but were not paid their profit since the year began and the matter was reported.
The police source, who has knowledge of the investigations, said that several persons turned up at the station yesterday but were unwilling to give statements as they were hoping that the man would be released and repay their money. However, another source said that it is likely that the man will be charged with fraudulent conversion.
On Sunday, at least 300 persons turned up at City Hall, where some of the affected persons convened a meeting in an attempt to find out about their money. After being informed of what was going on, their names and telephone numbers were recorded. Many persons, when approached had declined to comment and a few persons, who appeared to be in charge said that they did not want the matter to be in the media.
A source, who was present at the meeting, had told this newspaper that persons were warned not to speak to the media, since a businessman wanted to “subsidize” the export scheme, and this would be jeopardized if the media got wind of the matter.
This newspaper was told that the state agency employee mobilized the money by saying that he has a business exporting vegetables to Antigua. An associate would then go around informing potential investors about the business and the rate of interest they would get if they invested their money in it. This has been going on for about three to four years now, this newspaper was told. Persons, who invested, were required to sign a contract.
The source said that the persons were given the option of investing their money and then collecting the interest and the capital at the end of the month or collecting the interest alone.
Since the returns were lucrative, many persons opted to collect the interest alone, this newspaper was told. The news also spread by word of mouth and other persons invested in the scheme. Reports coming out of Sunday’s meeting say that one man invested as much as $11.5M while others also invested millions and others varying sums in the thousands and hundreds of thousands of dollars.
The source said that in December the investors were informed that the rate of return paid would drop to 20% because the business was affected by the global financial crisis.
They were told that although the vegetables were sent out, the market had dipped. Since then, no monies were paid and the investors attempted to get back their money. This, they found, they could not do.
