Lengthy wait for ‘distraught’ Qartaba Homes customers as probes launched

It will be months before hundreds of victims of a collapsed development ‘nightmare’ will find out how much of their investment they will recoup – if any.

Mahbubullah Chowdhury, centre, is a victim of Qartaba’s collapse. Picture: John Feder

It will be months before hundreds of victims of a collapsed development “nightmare” will find out how much of their investment – if any – they will recoup, or the outcome of investigations into the firm’s conduct and directors.

The Australian revealed on Tuesday how more than 200 customers had been devastated ­financially by the collapse of developer Qartaba Homes, calling for investigations into its directors and how lenders rubber-stamped millions of dollars in exorbitant-interest loans.

It’s understood the Australian Securities & ­Investments Commission has launched a probe into Qartaba, which remains in its infancy, and that a fraud complaint to NSW Police had been passed to investigators.

Directors Wajahat Rana, Khurram Jawaid and Kashif Aziz had spruiked Qartaba as Australia’s “interest-free answer” to the housing market, which ­adhered to sharia-compliant payments and targeted many first- or second-generation migrants. Many customers stressed the scheme was not the issue, nor the adherence with Islam’s anti-interest principles, but rather the mismanagement of the company’s finances.

Assistant Treasurer Stephen Jones, who has oversight of ASIC, declined to comment, although a spokesman for the body confirmed it was “aware and considering” the allegations, and remained in touch with liquidators.

Communications Minister Michelle Rowland’s division of Greenway takes in Qartaba’s office and many of the Sydney customers, and said it was an “extremely distressing situation”, pledging to ensure the relevant authorities investigated the matter as a “priority”.

Qartaba Homes directors Kashif Aziz, left, and Wajahat Rana in 2017 at the construction of one of its southwest Sydney projects.

“And (I) expect (any) wrong­doing to be met with the full force of the law,” she said.

NSW Fair Trading Minister Anoulack Chanthivong declined to comment, redirecting questions to his department, whose spokesman said the allegations did not fall within its jurisdiction. “We understand the frustration of those affected and urge consumers to seek independent legal advice,” he said.

NSW Fair Trading cannot act on allegations that fall under legislation within the oversight of NSW Police or ASIC.

Unbeknown to customers, land they’d purchased years prior had been mortgaged by Qartaba, often on multimillion-dollar loan facilities with interest of up to 26 per cent. When it failed to pay back its debt, creditors possessed the land and auctioned it off.

Questioning the due diligence of lenders, customer Nazim Chaudhry said it was “depressing” that no agency appeared willing to take an investigatory lead, saying it was “crucial” to help affected customers and close regulatory loopholes.

He criticised the fact NSW Fair Trading appeared unable to intervene, adding customers had previously contacted the Australian Financial Complaints Authority with little success and that ASIC would unlikely be able to investigate Qartaba’s overall conduct.

“This is quite a depressing situation for all of us,” Mr Chaudhry said.

Qartaba and its entities are understood to have borrowed upward of $200m, and liquidators Worrells continued to comb through its assets and are likely to report in the new year.

The Australian understands its probe could look at what lenders did or did not know about Qartaba when providing a loan facility.

Multiple cases against Qartaba are in front of the state courts, while many customers said they expected a class action to soon eventuate.