One of the 96 immovable properties of Heera Group attached by India’s Enforcement Directorate last year. Image Credit: Gulf News Archives

Dubai: She was the quintessential Muslim businesswoman — a self-made billionaire who wore a hijab and cared for the community. Religious scholars in India and Pakistan swore by her. ‘In the Interest of All Mankind’, proclaimed her company’s tagline.

For hundreds of thousands of families across South Asia and large parts of the Gulf, Dr Nowhera Sheikh — fondly called ‘Apa’ (Urdu word for elder sister) — was a veritable female messiah.

She promised and gave such high returns (36 per cent annually) on their investments that financial wizards would rub their eyes in disbelief. Some 200,000 people worldwide trusted her blindly with their money. But now Nowhera’s carefully crafted image lies in tatters. Two years after her arrest following the collapse of her Heera Group, investors still don’t know when they will get their money back, if at all.

Audacious fraud

Nowhera Sheikh

Nowhera, 47, was arrested in New Delhi on October 15, 2018 on fraud charges and brought to her hometown Hyderabad in transit remand the following day. Since then she has been in various jails. Currently, she’s imprisoned in Byculla District Jail in Nagpuda, Mumbai, facing trial for running an audacious multibillion dollar Ponzi scheme under the guise of Sharia-compliant halal investment plans.

In the suburbs of Mira Road, about 40km from Byculla Jail, lives Syeda Shabnam Khadri, who invested Rs1.6 million (Dh80,000) in Heera Group weeks before it shut down. The money belonged to her son Sayed Suhel Khadri, the family’s sole breadwinner. “It was our entire life savings and I gave it away without my son’s knowledge in the hope of getting a steady monthly income,” Syeda told Gulf News over the phone on Thursday. “When Suhel found it out, he slipped into depression. I watched helplessly as our family plunged into financial despair and my son’s health started deteriorating. He’d keep awake all night worrying about our fate. On January 9, this year he suffered a heart attack and died. I didn’t even have the money to pay his hospital bills. He was my only son,” she said.

HEERA GRAVE-1602840252880
Grave of Sayed Suhel Khadri, who died in Mumbai aged 38. Her mother who invested the family’s entire savings of Dh80,000 in Heera Group now survives on alms. Image Credit: Supplied

Suhel was 38. Syeda now survives on alms. Recently she was spotted begging opposite Umrao Hospital where her son breathed his last.

Nasir Khan, 42, also from Mumbai, who lost Dh260,000, said he’s shattered. “I am mired in debts while my children are sitting out of school because of unpaid fees,” he rued.

͵羺-based investors hit badly

The lives of thousands of Middle East investors have been similarly thrown into disarray by the abrupt closure of the company. When news of Nowhera’s arrest broke, many in the ͵羺 trooped down to the company’s office in Jumeirah Lakes Towers in Dubai, looking for answers. It was locked. Visits to the offices in Sharjah and Ras Al Khaimah also drew a blank.

Enticed by the promise of unusually high monthly returns, a large number of these people had borrowed from banks or loan sharks to invest in various schemes peddled by the Heera Group of companies. “A Heera agent told us they will invest my money in gold and textiles. I took a Dh100,000 personal loan and wired it to Heera Group. For a couple of months I got Dh3,000 per month but then the payments dried out,” recalled an Indian expat in Al Ain who didn’t want to be named. “I am broke. I lost my job recently and have no money to pay the EMIs. I fear I could be arrested for defaulting on loan payments,” he said.

Nasim Rajab

An Abu Dhabi-based Emirati, who used to work for a government entity, said her mother, Nasim Rajab, invested around Dh120,000 in the company. “It’s gone,” he said.

Dubai-based banker Muhammad Irfan, 42, and Indian bus driver Shahid Khan, 61, of Sharjah said they lost over 70,000 each. “I am living a nightmare. Every day is a struggle,” said Irfan.

A school dropout who started off by helping her parents sell vegetables, Nowhera professed to have built a business empire from scratch within just a few years. By the early 2010s, Heera Group had a finger in every pie from gold, forex trading, textile and jewellery to bottled water, real estate, electronics and e-commerce. Between them, the companies employed a staff of over 500 people, mostly agents whose primary job was to bring investments.

Flush with cash, Nowhera started splurging investors’ money on anything she fancied. In 2017, she forked out an undisclosed amount to secure the title sponsorship of the inaugural edition of the T10 Cricket League. The tournament organisers never revealed how much they were paid but a notice served to one of them by Indian’s Enforcement Directorate (ED) pegged the amount at Dh256 million.

In 2017, Nowhera ventured into politics. She launched the All India Mahila Empowerment Party (MEP) and contested the 2018 assembly elections from the state of Karnataka by fielding candidates in 175 of the 224 constituencies.

Sami Syed

Sami Syed, a Dubai-based entrepreneur and former T10 Cricket league director who joined MEP as general secretary but left before the elections, offered a plausible explanation behind the move. “She reckoned she could win some seats and wield the resulting political clout to scuttle any probe against her and perhaps also counter the regional All India Majlis-e-Ittehadul Muslimeen (AIMIM) party, whose president Asaduddin Owaisi had accused her of fraud,” Syed said.

He said he first met Nowhera in Dubai in 2012. Syed’s Phoenix Group of companies, which specialises in filling and packaging machinery, was a participant at a food and beverage trade exhibition held in Dubai. “She came to my stall and started shopping for expensive packaging machines the way one would shop for groceries. She bought equipment worth over Dh300,000 on the spot. In subsequent months, she purchased machines worth nearly a million dirhams,” Syed recalled.

He said when they announced the T10 league, Nowhera offered to be the title sponsor. “We readily agreed as her businesses looked legitimate.” Syed said he joined her political party as he thought she could bring change. But when I saw her splurge money on Bollywood stars to campaign for her, I grew suspicious. When I questioned the source of her seemingly infinite wealth and offered to quit, she got angry. Before I could resign, she fired me. I am glad I am not associated with her,” he said.

MEP stood no chance in the elections. Realising that defeat was a foregone conclusion, Nowhera resorted to trickery and deception. She tried to influence large sections of illiterate voters by citing a Satellite Political Survey (SAS) which claimed that MEP would emerge as the second largest party after the votes had been counted. The dodgy agency commissioned for the survey said their findings were based on a satellite. For good measure, it even gave the details of the satellite, complete with its coordinates. How could a satellite predict election results? Nowhera never answered.

Photoshopping to glory

Now single, the thrice-married woman was as good at mind manipulation as she was at Photoshop. In November 2018, a Gulf News investigation showed how she used the photo manipulation tool to fake awards and gain the trust of investors. Among these honours were ‘Top Business Woman Award’ from Shaikha Hend Faisal Al Qassimi, the ‘Princess of Dubai’ and the ‘Best Newcomer Brand’ for Heera Foodex at the Gulfood exhibition. On its Facebook page and YouTube channel, Heera Group also claimed to have organised the event at the Dubai World Trade Centre. Shaikha Hend Faisal Al Qassimi said she never gave any award to Nowhera. “I did indeed meet her once because she was covered in a book for successful Indian entrepreneurs ... but the picture of her standing besides me is Photoshopped,” she said.

QUEEN OF PHOTOSHOP-1602840259815
Nowhera used photoshop to showcase her achievments. Image Credit: Gulf News Archives

Nowhera also morphed an image from a 2014 event to show her receiving a book from Sushma Swaraj, India’s external affairs minister at that time. Nowhera was present at the release of The Indian Super 100, a coffee-table book which contained profiles of one hundred entrepreneurs and professionals from India. In fact, she was featured in the book too. But unlike many others, she did not receive the book from Swaraj.

Following the expose, Hyderabad Police ordered a probe into the doctored pictures and filed charges against Nowhera. In its charge sheet, the police said that Swaraj gave the book to an Indian man, but Nowhera morphed the images to make it appear that it was she who received the book from the minister during her visit to the ͵羺.

Biju Ninan, the publisher of The Indian Super 100, earlier told Gulf News that he contacted Heera Group’s office several times asking them to remove the doctored images. “They ignored our requests. It’s clear she morphed the pictures to seek mileage,” Ninan said.

Contrary to what it claimed, Heera Group also never organised Gulfood 2018. It was just one of the 5,000 exhibitors at the trade show, which has been an annual feature in Dubai for over 20 years now. There was nothing to substantiate the best newcomer award claim either.

Victim’s card

However Nowhera, who uses the title ‘Dr’ but is neither medically qualified nor has a doctoral degree, maintains her innocence. Her supporters blame the AIMM party for victimising her and framing her in bogus cases. “Owaisi saw Apa as political rival so he got her arrested. It’s a conspiracy. She has still not been proven guilty,” said one of her supporters. But Hyderabad-based whistle-blower and president of All India Heera Group Victims Association, Shahbaz Ahmad Khan, rubbishes these allegations. “There is no conspiracy. Heera Group was running a Ponzi scheme. Their moneymaking model couldn’t have lasted any longer,” he said in a phone interview with Gulf News earlier this week.

No real business

Khan said their investigations show the company had no real business. “Everything was a sham. The people who have filed multiple police complaints against Nowhera across various states in India and even abroad are not political activists. They are bona fide investors,” he said. Khan has now urged the Indian government to order a CBI probe into the matter. The Central Bureau of Investigation (CBI) is India’s premiere investigative agency. “We are talking about billions of dollars and nearly a million devastated lives. Investors based outside India should approach their missions and demand a CBI investigation as well,” he said.

India’s Enforcement Directorate has so far identified more than 160 bank accounts across India belonging to the Heera Group which ran a network of 15 group companies spread across India and the Middle East. In August 2019, the Enforcement Directorate (ED) attached Heera Group’s assets worth about Dh154 million. These included 96 immovable properties located in Telangana, Kerala, Maharashtra, Delhi and Andhra Pradesh in India, besides several bank accounts.

The federal probe agency said Heera Group illegally collected about Dh2.88 billion from around 172,000 investors after promising them up to 36 per cent annual returns. It said Heera Group also operated as many as 10 bank accounts in the ͵羺 and Saudi Arabia where investors would deposit money in the hope of getting attractive returns.

Will ͵羺 investors get back their money?

Statistics show that Ponzi scheme victims seldom recover their investments and on the rare occasion they do, it’s only pennies on the dollar.

Shahbaz Khan

Whistleblower Shahbaz Khan said the best recourse for investors based outside India is to contact local authorities and lodge police complaints. “Under Indian law, the proceeds from the sale of Heera’s assets will be distributed only among those who have lodged complaints. Those who have not staked claims will be kept outside of the purview of the law,” Khan said.

Advocate Saad Mohammad Salman of Mohamed Salman Advocates and Legal Consultants earlier told Gulf News that ͵羺-based victims of Heera Group could either lodge a formal police complaint or hire a lawyer to press criminal charges against the company.

Civil suit

“However, criminal charges won’t be enough to recover the money. A civil suit would also have to be filed. It’s an expensive proposition as the claimants have to pay a deposit of 6 per cent of the total claim, or the maximum cap of Dh40,000. They also have to factor other expenses like legal fees, cost of translation etc,” he said.

Ashish Mehta, founder and managing partner of law firm Ashish Mehta & Associates said investors should be realistic in terms of recovering their investments. “It is assumed that the people invested in a legal entity and did not give money to an individual. If Heera Group is not licensed by ͵羺 authorities to raise funds from third parties and yet doing non-regulated business, then it is unlikely it would have placed any financial guarantees/deposits with the regulatory body in the ͵羺. If this is the case, then investors can’t stake claim for the guarantee money. Also, if the limited liability company doesn’t have any assets, then investors should evaluate whether they want to initiate a civil claim against the company. Investors may also consider filing criminal charges against the office bearers of this limited liability company if there are grounds to accuse them of cheating, fraud and, perhaps, breach of trust. However this matter needs to be studied in detail by a legal practitioner first,” he had said in an earlier interview.

How investors were duped

In the ͵羺, Heera Group sought investments in three plans:

Heera Gold, which promised monthly payouts of Dh3,250 against a minimum investment of Dh100,000 (lock in period: one year), Heera Textiles which guaranteed annual returns of 65-70 per cent against a minimum deposit of Dh15,000 (lock in period: two years) and Heera Foodex where a Dh15,000 (lock in period: two years) deposit was supposed to yield annual profits of up to 80 per cent.