SIAS Urges Profitable Plots To Come Clean
The Securities Investors Association of Singapore (SIAS) has urged Profitable Plots to communicate with their clients and give an explanation on the defaults, reports the 25th May 2011 edition of The Business Times (Profitable Plots urged to explain defaults to investors), The Straits Times (Don’t keep clients in the dark: Sias) and Today (Profitable Plots case prompts SIAS to urge regulation of land banking).
According to the various papers, Profitable Plots is a land banking firm set up in 2004 by 4 British expatriates and a Singaporean and was known for its TV commercial with ex-footballers urging viewers to “Buy UK land“. It was probed by the Commercial Affairs Department (CAD) in August 2010. The CAD had received 229 complaints amounting to $23.5 million in investments by March 2011. Investors had put in money for land banking projects in Britain and Philippines and an industrial lubricant called Boron.
An estimated 1,000 Singaporeans and 4,000 foreigners had invested with Profitable Plots. Foreign investors told SIAS that they had agreed to invest with Profitable Plots due to the fact that Profitable Plots is based in Singapore, a financial hub with a ‘no-nonsense’ reputation. Retirees make up a majority of the investors. A lady retiree was rejected by Profitable Plots to sell one of her land plots to help pay for medical fees for her eye problems in 2009. She is now blind in one eye.
They Monetary Authority of Singapore (MAS) pointed a Straits Times reporter to their online guide on land banking when asked about regulation of land banking. Click here for the MAS online guide on land banking. According to the website, “Land banking which involves investors acquiring direct interests in real estate rather than securities (such as collective investment schemes) related to real estate is not regulated by MAS. … land banking investments typically involve investors acquiring direct interests in real estate rather than securities related to real estate. As such, land banking investment typically falls outside the scope of the SFA and FAA.“.
SIAS reminded investors to diversify their investments and practice due diligence before investing in any form of high risk assets.