- POSTED: 15 Aug 2014 07:09
- UPDATED: 15 Aug 2014 07:35
Up to 1,500 investors in Singapore have reportedly poured S$70 million into projects linked to the UK-based company.
SINGAPORE: Hundreds of investors here, who ploughed millions of dollars into the hands of a developer claiming to be working with the Brazilian government on a social housing programme, were left fearing the worst after the Brazilian Embassy said on Thursday (Aug 14) that its government had no dealings with the company.
In fact, it was not even aware until recently, when complaints from Singapore investors mounted, that the United Kingdom-based company operated in Brazil.
EcoHouse, which has abruptly shut down its Suntec offices, is neither affiliated with the Brazilian national housing programme nor registered as a partner of its state-owned bank.
“In view of allegations by Singapore investors regarding EcoHouse Group, a company linked to executives in the UK, the Embassy of Brazil would like to state that the Embassy had no prior knowledge of the existence of EcoHouse’s operations in Brazil,” the embassy said in response to TODAY’s queries.
Some of the investors had approached the embassy. After contacting several agencies within the Brazilian government, the embassy found that there was “no record of any agreement with any company bearing the name ‘EcoHouse’ related to ‘Minha Casa, Minha Vida’ (Brazil’s national housing programme), or any other federal programme”.
The embassy added that “Bosque Residencial” in Natal, State of Rio Grande do Norte – one of the housing developments offered by EcoHouse for investment – is not listed in the records of Brazil’s state-owned bank, Caixa Economica Federal.
COMPANY ON MAS' ALERT LIST
On its website, EcoHouse claims that it was chosen by the Brazilian government as “the only UK company to date officially authorised to build developments under Minha Casa, Minha Vida”, which aims to provide three million homes for the country’s growing middle class.
The company was founded in 2009 by Mr Anthony Armstrong Emery. Various media reports have put the number of Singapore investors in EcoHouse projects at between 800 and 1,500. Up to S$70 million had reportedly been ploughed into three housing projects.
Some investors have begun legal action against EcoHouse to recover their capital investments, which amounted to a minimum of £23,000 (S$47,810) per unit.
EcoHouse had promised a 20 per cent fixed rate of return for a 12-month investment contract, but many investors said they have not received their returns or their capital despite their contracts reaching maturity.
The company was recently put on the Monetary Authority of Singapore’s (MAS) Investor Alert List, which lists unregulated companies that may have been wrongly perceived as being licensed or authorised by the MAS.
Reports have been filed against the company with the police and the Commercial Affairs Department (CAD). On whether EcoHouse is under probe, a CAD spokesman would only say: “It is inappropriate to comment on police investigations, if any.”
In response to TODAY’s queries sent on Tuesday, EcoHouse chief operations officer Deen Bissessar said on Thursday that the closure of its offices in Suntec Tower 2 was part of measures to “consolidate into our Brazil operation and managing global affairs from our global headquarters in London”.
He added that “the position remains unchanged” and the company is trying to “improve the situation with regard to construction and payments”.
“We absolutely remain committed to our clients and if that was not the case, we would simply shut all doors – which is something we have no intention of doing,” added Mr Bissessar. The company was unable to respond to queries about the Brazilian Embassy’s comments on Thursday by press time.
The developer’s registered address with the Accounting and Corporate Regulatory Authority is in Cecil Street. When TODAY visited the premises, it was occupied by a company called MC Corporate Services.
EMBASSY ADVISES DUE DILIGENCE
For companies regulated by the MAS, investors could seek redress at the Financial Industry Disputes Resolution Centre. However, such a recourse is not available for EcoHouse investors.
The Brazilian Embassy has urged potential investors considering putting their money in Brazil’s property market to carry out due diligence when they encounter any developers claiming to have projects supported by the Brazilian government.
Consumer watchdog CASE advised consumers to be mindful of the high risk involved when investing in overseas properties.
CASE executive director Seah Seng Choon pointed out that the laws in other countries are different from Singapore’s and investors may not enjoy the same degree of protection. “Seeking redress in the event of dispute can be cumbersome and in most cases consumers are not able to get their money back,” he said.