Police have launched a criminal investigation into investment fund led by former MP Alhan Fahmy.
Without disclosing the name of the company, the police said in a statement that a Maldivian company had been flagged by authorities for conducting transactions similar to a Ponzi scheme. This scheme is believed to undermine the financial conditions of many parties.
The statement said that inquiry into the case revealed aspects that require further criminal investigation.
The police have urged the public to be critical of market risk sand to gather technical information before investing in schemes.
"We request that money should be invested in trusted individuals who are registered in accordance with the relevant legal frameworks and have a license or adequate permission. Otherwise, such actions could cause financial losses," the statement said.
As suspicious activity has been detected in King Forex Trading fund, Bank of Maldives (BML) has closed the accounts under Alhan's company.
Maldives Monetary Authority (MMA) has previously stated that King's Forex Trade has circulated over MVR 30 million from so far.
MMA said that in such schemes investors contribute money to the fund and then when those investors want their money back, they are paid out with the incoming funds contributed by later investors. They also said that these schemes are not sustainable and that most of those who took part in the scheme will not be able to get back their money.
However, no names were revealed in connection to this case.
Speaking at a press conference held by King's Forex Trading, the company's Chairman, Alhan said claims for compensation for the damages will be submitted to the court next week. Alhan said that charges are being filed against BML for damages caused due to the deactivation of the company's accounts.
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