Investment scam shocks muslims in Chicago
Both Indian and Pakistani community of Chicago and its suburbs are in a state of unrest and shock due to an unbelievable investment scam worth millions-of- dollars.business Updated: Sep 27, 2008 15:47 IST
Both Indian and Pakistani community of Chicago and its suburbs are in a state of unrest and shock due to an unbelievable investment scam worth millions-of- dollars targeting the community and sudden disappearance of Sunrise Equities's CEO Salman Ibrahim.
State regulators are considering criminal charges against a developer named Ibrahim, who fraudulently persuaded hundreds of muslims to invest in real estate deals. Some gave Ibrahim their life savings or mortgaged their homes before he disappeared in August. Investors say they may loose more than USD 50 million.
Salman Ibrahim, CEO and President of the Chicago-based Shariah compliant financial services firm, which provided the market with competent and innovative Shariah Compliant investment products and services, duped the community.
Ibrahim founded the company in 2001 as a religious financial service in accordance with muslim law of Shariah, meaning interest free investment. He would take money from people and pay them an amount in profits every month.
People started investing larger amount of money in his business. Ibrahim along with his partners continued taking money from the community, which they invested in community business for nearly eight years and distributed profits as well.
Being well known in the muslim community in Chicago, Ibrahim was appointed as one of three Vice Presidents of the Shariah Board of America. He also became well-known among the Muslim clergy in Chicago.
Lawyers for the investors are trying to force Ibrahim's company Sunrise Equities into bankruptcy. The state has suspended Sunrise's rights to do business.
The disappearance of the CEO and President of the firm has left many in West Ridge's Indo-Pak community wary.
Concern about the firm rose in August when profit checks from Sunrise Equities stopped coming.
No one has seen or heard from the firm's CEO. He has not returned investors' phone calls. Phone calls to the firm's office at 6355 N Claremont and its downtown affiliates, Sunrise Development Inc, have gone unanswered.
The Shariah Board of America's approval of investing in Sunrise Equities led dozens of other Muslims in Chicago mostly Indians and some Pakistanis to invest and lose hundreds of thousands of dollars in the company, which has developed multi-unit residential buildings in Chicago, investors said.
The investors added that they do not know if the company suffered losses because of the declining real estate market or for other reasons.
Salman Azam, an attorney hired by investors, said Ibrahim has not been seen since August. Sunrise's offices are closed... Last week, 150 investors filed an involuntary bankruptcy petition in US Bankruptcy Court, hoping to freeze Sunrise's assets, but they stand to recoup little more than USD 50 million in losses, Azam added.
Sunrise's Web site says the company developed close to 100 residential units in Chicago and was working on an additional 250 units. The Shariah Board said it approved Sunrise because Ibrahim was not giving interest on people's investments, but rather a profit over time. Islamic law bans muslims fro m collecting interest on money.
Many invested more when they saw profit-sharing checks come in the mail every month. Others joined after seeing friends profit.