‘Distraught, abandoned’ families in Qartaba Homes developer collapse
Distraught families have been left hundreds of thousands of dollars out of pocket, watching land they bought a decade ago auctioned off as a development ‘nightmare’ collapsed | WATCH
Distraught families have been left hundreds of thousands of dollars out of pocket, watching land they bought almost a decade ago auctioned off as a years-long development “nightmare” collapsed into mountains of debt.
Abandoned by political leaders and regulatory bodies, customers and victims of Qartaba Homes’ decade of delays, debt and mismanagement have asked: “how this could happen in Australia?”
Run by Wajahat Rana, Khurram Jawaid and Kashif Aziz, Qartaba had spruiked itself as Australia’s “interest-free answer” to the housing market, which adhered to sharia-compliant payments, before it collapsed last month.
But many customers stressed that the scheme was not the issue, nor the adherence with Islam’s anti-interest principles, rather the mismanagement of the company’s finances that had plunged Qartaba into liquidation.
“A lot of hard-earned money, blood, sweat and tears have gone into (our) savings, and to hand it over to these guys sitting at home not facing the music … it’s un-Australian,” Sydney customer Asher Sami said.
Breaking their silence, hundreds of customers – many who are first- or second-generation migrants – called for investigations into the directors and how lenders rubber-stamped millions of dollars in exorbitant-interest loans.
The Australian revealed in June that Qartaba’s unravelling development scheme, which had fallen into administration and which had targeted – albeit not exclusively – South Asian migrant families.
Qartaba would buy land before selling it to customers off the plan per lot. Customers would pay a deposit for the land, before then paying monthly development costs or land payments of about $4000, which would be interest-free.
Many customers completed their payments years ago, but their lots were never developed nor transferred to their name.
The company and its entities are understood to have borrowed upward of $200m, owing millions to at least 30 creditors, not including the hundreds of customers and their families trying to recoup their investments, totalling more than 200 across northwest Sydney, Tarneit in Melbourne, and south Queensland.
Mortgaging the land it sold to customers, Qartaba took out loans with interest rates of up to 26 per cent. Much of the land has since been repossessed by creditors and auctioned off.
Mr Sami had bought land and paid development costs at two Qartaba sites in northwest Sydney, although one has been auctioned off and the other possessed.
“We’re all gutted … the lenders, government agencies, what are they doing about this? Where is the help, why are there no laws in place for (the directors) to come and face the music,” he said.
Liquidators Worrells continue to comb through Qartaba’s assets to understand what’s salvageable, and how much is left, but customers remain at the back of the queue and are unlikely to receive their land.
“Angry is just one word (to describe us) … it’s also called depression,” customer Mhabubullah Chowdhury said, adding he “cried” when the severity of the situation dawned on him.
“We are watching what was supposed to be our home be sold in front of our eyes. How do (we) feel? This is mental and physical (pain) … there are no words.”
Mr Chowdhury, who emigrated from Bangladesh and had bought at Qartaba’s Tallawong development, asked a question on most victims’ lips: “how could this happen in Australia?”
Mr Chowdhury wants criminal investigations into Qartaba’s directors, asking how this situation spiralled, alleging – as have others – of being met with a wall of silence.
“(The directors) would not answer the phone, (there was) no communication,” he said.
The impact hasn’t only hit each customer’s wallet.
“We are suffering … I have seen adults crying in front of me and people hospitalised,” said Jawad Nawaz, who bought from Qartaba in Sydney and Tarneit.
“It’s our mental and physical health. My children are suffering because of my own behaviour, they don’t come near me because they know how easily frustrated I’ve become.”
A first-generation migrant, Mr Nawaz said he hoped to build a home for his children. “(This) has pushed me back a decade, all my savings – my personal savings and super – have gone,” he said.
“I can’t even begin to imagine if I could ever (get) enough to buy anything again.”
Another customer invested in Qartaba’s Riverstone project in 2012, which was completed eight years later but never transferred to their name and later possessed by a mortgagee.
The customer, speaking on the condition of anonymity, said he watched it sell at auction in April.
“I wake up at night feeling like I’m in a nightmare,” he said, adding that he was a full-time carer for his child with learning difficulties and would struggle to work for much longer.
The customer said one director convinced him to invest his super into another project in 2014, where he paid land and development costs in full.
The now-registered and developed lots are worth millions, but will be sold to pay off Qartaba’s debts.
“(We) have lost our homes and superannuation, putting us back to where we were 15 years ago when we arrived in Australia,” the customer said. “We trusted them because we believed that being here meant we were safe.”
Customer Shafikul Islam said most customers were skilled migrants who had come to Australia to secure their future.
“We are (angry) with Qartaba, but more so with the government and system, which has allowed (this to happen),” he said.
Alongside regulatory bodies, a finger has been pointed at those creditors who lent the firm millions.
“We are not likely to get anything from (the land) sale, it’s all going to go to the lenders,” customer Nazim Chaudhry said.
“How can they can give loans with such high (interest) despite knowing Qartaba’s business model that there could be existing instalment customers?
“We’re not going to get anything (as unsecured or low-secured creditors) … that is the conduct that also needs to be looked at (lenders’ due diligence).”
Community leader sheik Farhan Khalil bought a Qartaba plot in Sydney a decade ago with his wife Samreen Irfan, with what had been spruiked by the company as a 2018 delivery date. “Until recently we still felt comfortable, still had hope (that the property would be delivered),” Ms Irfan said.
“Even after that, we thought we still had the law, that it would be on our side.”
Ms Irfan said the millions owed by Qartaba meant customers could see little back at the end of the liquidation process, asking how such large loans were given to the directors and on lands already sold.
“If it wasn’t for them (the lenders) we’d have a good chance of getting back our land, rather than fighting for scraps,” she said.
“If lenders aren’t scrutinised, if regulatory authorities don’t take (the issue) seriously, it’s going to keep happening.”
Sheik Khalil said customers’ focus had also turned to shining a light on how Qartaba had been able to rack up millions of dollars in high-interest loans and debt.
“Why are they (the lenders) so untouchable, what happens to ordinary people like us,” he asked.
Customer Zahir Hussain called the authorities’ response “useless and toothless”, saying he’d flagged concerns with his state MP and the NSW Fair Trading Minister.
“Someone from the Australian Securities & Investments Commission called me and asked about how I invested my super, all those things,” he said.
“I asked him ‘how are you going to help me?’ He said ‘I’m not going to help you, but we’re going to tighten the regulations’. That’s not going to help us.”
While ASIC are investigating possible breaches of the Corporations Act, NSW Fair Trading found that the matters raised “did not fall” into its jurisdiction.
More Coverage
DNA sample testing from Queensland’s troubled forensic labs fast-tracked
DNA samples languishing in Queensland’s state-run forensic laboratory will be fast-tracked in a new $50m program to create justice for victims.
Nurse tells of Erin Patterson’s reaction to kids being assessed
A nurse has told the murder trial of Leongatha mushroom cook Erin Patterson of the accused's reaction to her children being assessed, as evidence continues on Thursday.