Pakistan’s Proton has been involved in an alleged mega fraud of Rs890 million with customers, raising serious concerns within the government.
This car brand is operated in Pakistan by the Al-Haj Group, which also runs an oil and gas exploration company. Proton is a Malaysian automobile brand.
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The company offers the Saga sedan, X50, and X70 to customers and is considered a rival to Kia, MG, and Hyundai.
The company booked cars for customers and received Rs 890 million from them to deliver vehicles. However, it failed to deliver cars despite receiving a hefty amount from customers. The SAPM Hamayun Akhtar Khan and the new CEO of the Engineering Development Board (EDB) took action, which resulted in the return of Rs300 million to customers.
The company is still holding a large amount of customers’ money, and the government is pushing it to pay back the entire amount.
Sources told NewzTodays that some other carmakers were also allegedly involved in fraud, and customers had become a shuttlecock. Some companies had booked cars five years ago but had not returned the amount to customers.
Under the auto policy, carmakers must pay interest on the amount received from consumers if they fail to deliver cars within six months.
Currently, carmakers are not paying interest, and they have also not returned the actual amount received for booked cars.
Sources said the new EDB CEO had started cleaning up the mess created by the previous management, which had allegedly joined hands with carmakers.
The EDB is the regulator of the car industry and is responsible for safeguarding consumers’ interests. This regulator had failed to take action in the past.
However, the new EDB chief, who is foreign-qualified and considered highly honest, stepped in and took action backed by the SAPM, after which Proton returned Rs300 million to customers.
The government had introduced a new auto policy and offered incentives to new entrants to break the monopoly of Japanese carmakers such as Suzuki, Honda, and Toyota.
However, some new carmakers have reportedly proved worse than Japanese manufacturers. These entrants allegedly engaged in large-scale fraud with customers, booking cars but failing to deliver them.
