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Gold scheme firm hands over cash to embassy

Manama, November 25, 2010

Owners of a gold scheme in Bahrain, who allegedly failed to pay their customers following the closure of a shop, have handed over 40 per cent of the outstanding cash.

It has been passed to the Indian Embassy following several meetings between diplomats and the businessmen.

An earlier month-end deadline was set for the owners of the scheme, run from a store in Gold City, to pay back 50 per cent of the outstanding amount.

Star Mark Jewellery Padothodi Hussain and Pauly Paul agreed to pay half of the sum immediately and the rest gradually.

Sources told our sister newspaper Gulf Daily News (GDN) 40 per cent of the amount had already been handed over to the embassy and the remaining 10 per cent was expected to be given to the officials today.

'We will re-pay all the customers by next week.'

Hussain and Paul opened the store four years ago and announced a gold scheme offering people a chance to invest BD10 per month and get the money back in gold at the end of it.

For each BD20 deposit, customers were given coupons and entered into a monthly raffle for a brand new car and other prizes.

Many low-income Indian workers, including women, reportedly invested their savings into the scheme.

Paul earlier said his partner Hussain had filed a complaint against him at the embassy, saying he had taken 2kg of gold from the store.

Hussain has been living in Bahrain for 30 years and Paul for 15 years.

The embassy launched an investigation after more than 200 people stormed the shop for the second time in two days.

Customers claimed they were promised refunds and demanded to be paid the money they had invested.

They queued near the shop for several hours, only to find out the owners had not opened the shop.

The GDN reported last year that thousands of Gold Link customers were affected after it had been hit by a cash-flow crisis created by a rush of customers seeking to claim their gold.

Angry customers had gathered outside the jewellery shop in Gold City, claiming they had lost thousands of dinars.

However, an official at the store said customers would get their investments back.

The embassy later appointed a law firm to represent the customers' case, which is still ongoing.

Embassy officials were yesterday unavailable for comment.-TradeArabia News Service




Tags: Bahrain | investment | finance | Savings | Star Mark Jewellery | gold deposit scheme |

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