ISLAMABAD: The dream of hundreds of Pakistanis to have an offshore luxury apartment has turned into a nightmare with the ARY lately issuing cancellation orders of their allotments in Dubai International City.
While these innocents were waiting for the possession of their Dubai dream houses that they had bought two years back on instalments, they instead received a bombshell — cancellation order. The shocker in each case was accompanied by the photocopy of a cheque containing 90 per cent refund of the principal amount they had paid to the ARY. They were directed to collect the cheque from the respective ARY offices in Islamabad, Karachi and Lahore.
The affectees see it as the worst ever offshore rip-off executed in a unique fashion where after circulating the people’s money in Group’s business for two years they are finally offered 90 per cent refund without any fault on their part. Most of the affectees, including military and civilian bureaucrats, doctors, academicians, businessmen and others, have refused to collect their cheques and are weighing different options including approaching the government on this, what they call, offshore swindle.
These affectees complain that the sorry part of the whole episode is that it is the ARY that has backtracked from its commitments made to the allottees. They say that the cancellation orders have been issued unilaterally and without any prior warning at a time when they were to get the possession of their apartments. It is said that the prices of these apartments have gone very high, a fact that might have prompted the ARY to cancel the original allotments and sell the property in the open market to earn huge profits.
And most interestingly, hundreds of these Pakistanis are being refunded their partial deposit by the Dubai based ARY out of the recent US$10 million offered to the Group by the National Bank of Pakistan. The NBP has also agreed to give this loan to the company to save it from default in Dubai.
The NBP had offered this huge financing to the ARY despite latter’s figuring on the State Bank of Pakistan (SBP)’s list of top loan defaulters in Pakistan besides being prosecuted on “corruption” allegations by the National Accountability Bureau.
The ARY Dubai office is tight-lipped on the Dubai Apartment cancellation issue. However, Karachi based country head of the Group told The News that those who did not make the full payments were denied allotments.
The ARY is though reluctant to give the exact figure of those whose allotments have been revoked, a just formed Islamabad-based action committee of the affectees claims that the number of such ill-fated people is at least 700.
Its Chief Coordinator Dr Salma Kafeel, who runs her own clinic in Islamabad, told The News that she has with her the names of 250 such affectees from Rawalpindi and Islamabad. She said that she was allotted three apartments but got their cancellation orders last week.
Kafeel termed it a “major offshore fraud” and said that despite meeting all the requirements on their part, the allottees received cancellation orders without any prior warning. Almost all the affectees including Kafeel, contacted by The News, confirmed that they were never issued any intimation letter about the cancellation of their allotment.
However, the ARY in its cancellation order to each affectee said, “Reference to our letter intimating about cancellation of your above-mentioned apartment; we have dispatched to you a cheque of AED......./- (different amount) after deduction of 10% received amount as service charges. Please collect the said cheque (photocopy attached) from the regional office in Karachi/Lahore/Islamabad on surrender of your file of the said apartment.” Each of these cancellation order is signed by Altaf H Chishti, General Manager, ARY Properties - Dubai.
According to the details the ARY advertised apartments in Dubai International City for sale on June 27, 2004. The advertisement clearly said, “pay only 30%” and guaranteed “70% financing through Islamic mode of banking” payable in easy instalments over a period of 15 years.
It was also committed that the allottees would get possession of their property “after two years” besides guaranteeing “annual rental income” that would offset the (70%) loan instalments under property management agreement. And the last attraction given was of Dubai’s “Residence Visa” to allottees on the basis of investment.
On the basis of this advertisement hundreds of Pakistanis applied, deposited the required advance and fulfilled other requirement. Within weeks, allotment letters were issued to the successful applicants. Dean Faculty of Engineering Air University Dr Zafar Ullah Koreshi while showing the allotment letter of his wife to this correspondent said that on July 16th 2004 they were allotted apartment No RA1-105-(S1-122) on First Floor at ARY Residencia of International City, situated in Dubai, UAE. Through the same letter, Dr Koreshi said, it was conveyed that M/S Nakheel were the developer of the project.
As per the advertisement, the allottees paid 30% of the cost of each apartment (Rs 1.2m for studio flat and Rs 1.7m for one bed room apartment). In addition to this, registration fee for Nakheel Rs 100,000 were paid by each allottee.
During February-March this year, according to most of the affectees including Koreshi, the allottees were asked to submit documents for 70% promised financing by a Dubai based financial institution. “Later, however, we were verbally told that no Dubai Bank is ready to offer loan to Pakistanis,” Koreshi said.
Afterwards the ARY, according to the affectees, instead of giving any option of either selling their property or arranging loan or finances on their own issued the cancellation orders of their allotment. An affectee Col (r) Ziaul Qamar, presently serving in Nescom, told this correspondent that by doing this the ARY has done a fraud worth billions of rupees against Pakistani nationals. He said that seeing the high profitability because of escalating prices of the apartments in Dubai, the ARY backed out of its commitments and is selling these apartments in open market.
Qamar said that the prices of these apartments have risen 2-3 times. Another retired colonel Masood Baig said that the ARY did not follow any principle while dealing with hundreds of Pakistanis. He said that there has been no breach of agreement on the affectees’ part rather it was the ARY that did not keep its promise and changed its mind seeing high profits.
Baig said that the implications of, what he called, this “100% fraud” are too serious as besides inflicting financial loss upon hundreds of Pakistanis, a chance to increase remittances from Dubai has also been lost.
While most of the affectees have the same tale to share, one Kamran Niaz, who had the allotment in the name of his brother Hamdan Niaz Abbasi revealed that a letter dated May 6, 2006 signed by the ARY Regional Head Pervez A Malik in Islamabad confirmed to him that M/S Nakheel had completed his flat. He was asked through the same letter to update his payments as soon as possible. He said following this letter when he went to the ARY Islamabad office with the offer to pay the remaining amount (Rs 2 million), the regional manager ARY Islamabad refused to accept it. “A few days later I received the cancellation order,” he said.
Dr Kafeel also told this correspondent that she too had offered that she would either pay the remaining 70% amount or would arrange loan from a Pakistani bank but she too got a cancellation order.
Chairman ARY Haji Abdur Razzak and the Group’s GM in Dubai Altaf Chisti were contacted but they were shy to talk to this correspondent. However, the Karachi-based Country Head of the ARY Aslam Elahi when approached admitted that hundreds of allotments have been cancelled. Without giving the exact figure of the cancelled apartments, he said that the allotments were annulled because the allottees were not paying their dues.
When asked as to why did the ARY fail to facilitate the promised 70% Islamic bank financing to the allotees, he initially said that those who had qualified got this loaning but later confirmed that Dubai financial institutions don’t offer loan to Pakistanis. On further probe as to how many and who got the promised financing, he said such allotees are around 100 and are living in Dubai.
He explained that the ARY was not getting the payments from the allotees but it had to pay the committed payments to Nakheel- the Dubai-based developer. He said due to this situation there was no option but to cancel the allotments of those not making the payments.
He said that those allotted apartments in Italian Block were asked in May-June this year to immediately make their full payments in order to get the possession of their properties. Those who made the payments, he said, are facing no problems while others who did not make the payments had to face the cancellation of their allotment.
When asked about US$ 20 million bridge financing including NBP’s share of US$ 10 million offered to the ARY a few months back, he said the said loan money is being used both for the purpose of paying refund to those whose allotments has been cancelled and to complete the project to give early possession to the qualified allottees.
