The collapse of the British arm of Brazilian property developer EcoHouse could see Singaporean investors losing as much as S$50million, and investors worldwide close to S$70million.
Speaking to British newspaper The Financial Times, British-based Brazilian lawyer Renata Sa, who is representing 400 Singapore investors as well as other investors from around the world in two class actions, said: This should be a wake-up call.
It is known that action is being taken against the Brazil arm of the EcoHouse operations, as well as real estate agencies and financial advisors in the United Kingdom who were responsible for handling an Escrow account.
EcoHouse sold more than 1,000 individual investments in Singapore and Southeast Asia during 2012 and 2013. The British company was the subject of a creditors voluntary liquidation last month, at which PricewaterhouseCoopers was nominated as the liquidating company.
The Brazil company is not, as far is known, in liquidation although media reports suggest progress is at a standstill following alleged tax irregularities and a police raid last year. Many Singapore and Asia investors have sales and purchase agreements with the Brazilian company, and not with the U.K. company which is facing liquidation this month.
Flamboyant company founder, Anthony Armstrong-Emery, is reported to be in the Middle East attempting to raise additional funds, but time to save the EcoHouse empire, and with it millions of dollars and investment, appears to be fading fast.
According to the British newspaper, EcoHouse has blamed the unexpected intervention of the Brazilian Police on malicious, inaccurate and fanciful allegations by competitors and former landowners. Funds worth more than S$65 million said to be being investigated.
British Police are also taking an interest, with an investigation reportedly taking place by the Fraud and Linked Crime Online Team of the Metropolitan Police. It estimated some 200 complaints have been made from the U.K. with a value of some totally S$14 million.
EcoHouse was the best-selling single overseas property investment in Singapore during 2012, and with its offices at Suntec Tower, which have since closed, it attracted many small-time and first-time overseas property investors in Southeast Asia with promises of 20 percent returns in 12-months on its S$46,000 social housing property investments. Many investors purchased multiple units while other clubbed together with family and friends to buy a single property.
PropertyGurus attempts for comment from the company at all its known contact points have so farbeen unsuccessful.
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