Creek Marina Project: A Tale of A Billion-Rupees Scam, Corruption, and Greed
The affected people have been running around from pillar to post for over 18 years seeking justice
Special Newztodays Report
Singaporean company Meinhardt Singapore Pte Ltd. announced the launch of Pakistan’s first 6-star project in Karachi’s Defense Housing Authority (DHA) in 2005. Like other scandals in the country’s history, Meinhardt also planned to rob the Pakistani people under a housing scheme. And the people of Karachi were defrauded of billions of rupees in the name of luxury flats.
The company, through another shell company registered in Singapore, opened “fake” accounts in local banks (Silk Bank and Meezan Bank) without registering itself with the Board of Investment, the Securities Exchange Commission of Pakistan, and the State Bank of Pakistan.
The project sponsor asked the public to deposit money for advance bookings. They also asked Investors to deposit working capital against the promise of partnership. Trusting the project, more than 300 families deposited 2.5 billion rupees in the above accounts, but Meinhardt transferred this money to foreign countries instead of investing in the project through Hundi and Hawala (underground banking channels) in contravention of Foreign Exchange laws.
Meanwhile, the allottee victims had approached the Federal Investigation Agency (FIA) claiming they had submitted their deposits and booked their apartments in the Creek Marina project.
Now, 18 years have passed. But Meinhardt Singapore has failed to complete the project and hand over the flats. FIA has added the name of the company owners Dr. Shehzad Naseem and his son Umar Shehzad to the watch list.
The warrants for arrest have already been issued in another criminal case. It should be noted that both father and son are citizens of Singapore and have failed to return back to Pakistan since the year 2019.
According to the investigations so far by the Anti-Money Laundering Wing of the FIA, Meinhardt Singapore extorted billions of rupees from the public through a crack scheme and the company opened an illegal bank account and transferred more than three billion rupees abroad.
In this regard, the company owners, Dr. Shahzad Naseem, Umar Shahzad, CEO Ayesha Warsi, and one Nudrat Mand Khan have been named in the FIA investigation. Further accused are likely to include several bankers, contractors, and other employees. In this regard, the victims have also written a letter to Public Account Chairman Noor Alam and demanded assurances that ongoing investigations not be derailed through manipulations and interference through Dr. Shahzad Nasim’s contacts and relationships with persons of importance.
According to the details, a Pakistani origin Nasim Shahzad believed to be a representative of Meinhardt, signed an agreement in 2003 with the Defense Housing Authority Karachi to acquire 92000 square yards of land (19 Acres) of prime waterfront land on lease in DHA-Karachi Phase 8.
The current value of this land is upward of 150 Million Dollars as per today’s market. According to this agreement, Meinhardt was to complete the project within 3 years but failed to despite nearly 2 decades of extensions by DHA.
In this regard, Meinhardt had formed a company called Creek Marina Private Limited in whose name 19 Acres of land now vests under sub-lease. Under this agreement, Singapore company Meinhardt Singapore Pte Limited had the mandate to design, construct, develop, and market the luxury flats on the land DHA had given against no payment whatsoever.
Rather, DHA undertook this risky enterprise of transferring billions of rupees of land to a company with no experience in construction and development, only design and consultancy, with the remote hope that one day the project will be constructed and DHA would receive 15% of the apartments constructed.
The company, while marketing its project at the time, claimed that the 6-star project has 8 towers of 24 floors with three and four-bedroom apartments as well as several penthouses.
The project was marketed as being a partnership between DHA and Meinhardt which gave the public confidence to invest their savings. In this regard, Creek Marina started selling apartments on June 20, 2007, and at that time the price of a flat was fixed at around Rs 3 crore which was to be paid in installments over 30 months.
The company had pledged to complete these luxury apartments and hand them over to its customers by December 31, 2009.
The project could not be completed within the stipulated period. It is estimated that nearly 60% of the purchase price has been collectively paid by the allottees. By this estimate, an amoun of Rs. 5 Billion has been collected from allottees, but the amounts available in the accounts of the project are less than half.
When the work on the project did not start, DHA and Creek Marina made a first amendment to the agreement dated 5 May 2005, according to which the project was to be completed in 2 phases, under which 8 towers were to be built instead of two. 19 acres of land were also sub-leased in the name of Creel Marina Private Limited, but despite the amendment of the agreement, the project could not be completed.
A second amendment to the agreement was signed between DHA and Creek Marina on 4 June 2009. According to this amendment, DHA surprisingly agreed to reduce its share in apartments from 15% to 3.75% despite the fact that there was no progress in the project.
Under this new agreement, the project was to be completed and delivered in 3 phases. According to this agreement, Creek Marina was to complete the first phase by June 2011, the second phase by December 2011, and the third phase by June 2012, but the company did not build it and despite a significant discount by DHA, was left with nothing.
The sponsor halted construction work on the project in 2010.
Chinese contractors that were hired by Creek Marina (Pvt) Limited with the amounts collected from allottees had abandoned the project.
The project sponsor Creek Marina had encashed Performance Guarantees of the Chinese Contractors. However, rather than disbursing roughly Rs. 1 Billion into the accounts of the project, the project sponsor had made an attempt to siphon off the money through an illegal fake account of a sister concern, Creek Marina Singapore Pte Ltd, registered in Singapore.
The objective was to take the amounts abroad and in favor of one local partner Aftabuddin Qureshi.
Upon taking notice of the attempt to siphon off funds from Pakistan, the DHA filled cases with the allegation of money laundering in the Sindh High Court and had the accounts stayed. However, both cases was withdrawn despite serious allegations of fraud and unlawful enrichment.
In April 2011, the Sindh High Court decided that 1 billion Rupees from the Guarantee of the Chinese Contractor should be escrow account of the project developers so that the construction work could resume.
The Sindh High Court developed a lengthy modality on the basis of which project funds can be used with transparency with DHA acting as supervise. However, despite this mechanism, no construction was carried out.
Meanwhile, a hundred allottees had constituted the Creek Marina Action Committee headed by one Mr. Yousaf Mirza. They decided to approach DHA and CMPL to resolve the issue. The committee concluded its findings saying that Dr. Shehzad Naseem is the mastermind of the fraud being played on the allottees and approached the National Accountability Bureau with the complaint.
After that, the committee members met Dr. Shehzad Naseem in Dubai in May 2012, Dr. Shehzad told the committee that DHA is not supporting this project.
On this occasion, Shahzad Naseem agreed with the committee members that if the committee members cooperate to release the funds, the apartments will be handed over within 3 years.
The NAB authorities commenced investigations which resulted in further litigation. During the litigation, NAB brokered a settlement deal between the Creek Marina Action Committee and Shahzad Nasim.
In the agreement, it was settled that the NAB inquiry would be closed and that the project would be partly delivered by June 2022. However, despite the close of the NAB case in 2019, there has been no progress. The allottees are left with no recourse but to return to NAB.
In 2014, DHA lodged FIR against Dr. Naseem Shehzad, a citizen of Singapore, Creek Marina Project, and other companies. In the FIR serious allegations of fraud and money laundering of Rs. 3 billion rupees were reported. This case, despite the serious allegations, was ultimately withdrawn by DHA. It now appears the FIA has started its own independent investigations despite DHA’s withdrawal.
After a long legal battle, DHA and Creek Marina entered into a third amendment to the project agreement, dated June 18, 2019, under which all project funds will be kept in an escrow account and the project will be fast-tracked.
Pursuant to this agreement time DHA’s share was enhanced back to 15%. Despite the unjustified delay, DHA did not take any security from Meinhardt in any shape or form.
It appears that rather than taking a strict approach with Meinhardt, DHA permitted additional apartments to be made and permitted collateralization of the now Billions of rupees worth of land.
Moreover, DHA further appears to prejudice the allottees by disassociating itself from the allottees and sifting all liabilities of the allottees to Meinhardt. As such, it appears that in order to obtain relief, allottees cannot rely on DHA. A remarkably one-sided agreement was executed by DHA in which considerable generosity was shown to Meinhardt.
After the third agreement with DHA, the company started playing another game with the allotments and appointed a woman named Ayesha Warsi as the Chief Executive Officer of Creek Marina by hiring new staff, the process of selling the remaining apartments of the company was started again.
Allottees who had booked and deposited money in 2005 were given notices to deposit more money, at new rates, or else their bookings will be canceled and the apartments would be at a higher rate. It now appears that as a result of the FIA inquiry Ayesha Warsi resigned from her post on July 1, 2023.
According to the FIA Money Laundering Investigation is ongoing against Creek Marina Management.
In addition, another investigation has started with respect to banking crimes. Sources at FIA have revealed that another company by the name of Creek Marina Singapore Pte Limited, incorporated in Pakistan, has been undertaking business in Karachi and significant local funds were diverted into the accounts of the Singaporean Company in local Banks such as Silk Bank, Habib Bank and Meezan Bank.
Sources reveal that these fake accounts were operated despite the fact that Creek Marina Singapore Pte Limited had not obtained the permissions required from the Board of Investment, the Securities Exchange Commission of Pakistan, and the State Bank of Pakistan.
Sources further reveal that this is in contravention of the Companies Act, 2017, the Foreign Exchange Regulations, and several other laws of the land. It is further alleged that said accounts were opened under the signatures of Dr Shahzad Naseem, Mr. Omar Shahzad, Mr. Nudrat Mand Khan, and Mr. Richard Coventry without meeting legal requirements and with the connivance with bank officers.
According to the FIA investigation, the funds to be received by Crack Marina Singapore PTE were transferred to various personalities including the names of Nudrat Mand Khan, Ayesha Warsi, Salman Mand, Dr. Shahid Nasim, and Umar Shahzad, Syed Asghar Ali Shah, Aftabuddin Qureshi and Akber Ali Shakir. The amount transferred was also not included in the financial statements of Creek Marina Private Limited and Creek Marina Singapore Pte Ltd. According to the FIA, an alleged money laundering scheme was run through illegal accounts.
According to this letter of the victims, more than 12 lakh dollars was sent out of Pakistan through a person named Aftabuddin Qureshi, which was received by Singaporean citizens Dr. Shehzad Naseem, Richard Charles Coventry, Syed Asghar Ali Shah, Akbar Ali Shakir, and others. Aftabuddin Qureshi transferred another amount of 15 lakh dollars to an account of MCB Zaibunissa branch, after which this amount was transferred to the offshore account of the company.
From the record, it appears that several offshore shell companies own Creek Marina Pvt Limited. The record presented to the Public Accounts Committee in their latest sessions indicates that an intricate web of offshore companies has been sown by Shahzad Nasim with the help of English Banker Mr. George Collin Gee, the latter being heavily mentioned in the Panama Papers as an architect of offshore schemes.
It appears that the 19 Acres of prime waterfront land vested by DHA in the name of Creek Marina Pvt Limited is ultimately owned by a company registered in the British Virgin Islands by the name of Swiftearn Holdings and not in the name of Meinhardt.
It appears that material misrepresentation was made by Meinhardt when it convinced DHA to lease several millions of dollars of land in favor of Creek Marina (Pvt) Limited
It also appears that DHA did not consider that Meinhardt was a renowned engineering and architectural consultant and not a developer.
As per the record made available, it appears that Meinhardt had no experience as a developer, but despite this valuable land was transferred. This proves that Dr Shahzad Naseem kept DHA in the dark and DHA leased the land to companies owned by one person who was an employee of Minehard Singapore.
According to securities exchange records, Creek Marina Private Limited was wholly owned by the Singaporean company Creek Marina Singapore Pte Ltd, and Creek Marina Singapore was wholly owned by a shell company called Swiftearn Holding Limited (Swiftearn Holding Limited), which is secretly owned by British Virgin Iceland.
In this regard, one of the affected Allotee Syed Danish Ghazi, Advocate, who had made a presentation to the Public Accounts Committee has said that he had booked an apartment worth Rs 2 crore, out of which he had paid Rs 1.68 crore over the course of 4 years.
He further stated that the developer started demanding extra money from him and he had asked for assurances. Rather than providing assurances, his allotment was canceled a letter from renowned law firm Mohsin Tayebaly and Co. Against such prejudicial treatment from a member of his own legal fraternity, he had filed suit before the High Court where a stay is operating over the apartment he has waited 18 years for. Currently, Mr. Ghazi is fighting on many fronts, alone.
Weak Regulators Failing Victims of Singaporean Real Estate Scam
It’s been about two long decades since investors of the infamous Creek Marina project are waiting for the Singaporean developer to deliver their luxury apartments.
In perhaps the longest real estate scam a Singaporean national of Pakistani origin, Dr. Shahzad Nasim, brought to the surface the underlying weaknesses of Pakistan’s regulatory system.
Nasim and his accomplices from Meinhardt Singapore PTE. Limited (MSPL) appears to have robbed about 300 Pakistani families of their hard-earned earnings with impunity and are at large despite their failure to deliver the project for the last 18 years.
Creek Marina project is a six-star luxury residential complex that was to be built on the shores of the Arabian Sea in Phase VIII of Karachi’s Defence Housing Authority.
At least 280 families had booked their high-end apartments, each valuing more than two million rupees to be paid in easy quarterly installments when MSPL of Nasim launched the project with much fanfare in 2005.
However, all the apartment owners have so far gotten is hope against hope. For all those years passed they have been running from pillar to post to either get refunded more than Rs 3 billion the fraudulent company seems to have siphoned off or a serious commitment of possession in the ill-fated project.
The allottees at the time of booking were reassured by the fact that the project was not being developed by a fly-by-night Pakistani builder, but by a Singapore-registered company in partnership with DHA, owned by Pakistan’s all-powerful military.
Nasim and his cohorts, including his son Omar Shahzad, Nudrat Mand Khan, Aisha Varsey, Salman Mand Khan, Richard Charles Coventry, Syed Asghar Ali Shah, and Akbar Ali Shakir, cheated even the DHA which allotted thousands of square kilometers of its land to various companies owned by a single owner, Nasim.
The DHA land is worth Rs 46 billion, according to the latest estimates.
The allottees have come to know that the “delinquent foreign company” has never built a single apartment and is rather registered in Singapore as an engineering and design firm.
After getting evasive answers from the local management of Creek Marina, the flat owners have lodged complaints against the MSPL and its owners with the Sindh High Court, the National Accountability Bureau, the Securities & Exchange Commission of Pakistan, and the Federal Investigation Agency (FIA).
The FIA investigated the scam and initially found that a local official of MSPL, Aftab Qureshi, has been laundering millions of dollars to his associates in Singapore through illegal banking channels. The company has been sending its ill-gotten earnings abroad through fake accounts it had unlawfully opened in local banks, including Pakistan’s biggest Habib Bank.
It is legally binding for foreign firms to get approval from the Board of Investment (BOI) if they wanted to open a local bank account. The Singaporean company never sought such permission, according to FIA.
The federal investigators have also found that the ultimate owner of MSPL is Swiftearn Holding Limited, a shell company registered in the British Virgin Islands.
Creek Marina was also named in Panama Papers revealing that its chief executive officer, John George Collin Gee, a British banker of Singaporean origin, was an expert in setting up offshore companies and money laundering.
The latest move from the apartment owners was in June when they sent a letter to Pakistan’s Public Accounts Committee (PAC) requesting its chairman to probe into the matter.
Worse the fraudulent firm is asking the troubled investors for more money and threatening that their allotment may be canceled should they fail to pay.
It, however, remains to be seen what action the country’s company and banking regulators take against the self-styled Singaporean foreign investor.
