The Jakarta Police in the past two months have uncovered two fraud cases involving sharia-compliant housing — offering cheap homes without riba (interest) or banking checks — that both used the same scheme and defrauded nearly 4,000 people of up to Rp 63 billion (US$4.5 million).

The first case came to light in November, in which the police revealed four suspects, identified only by their initials AC, MAA, MMD and SM, who had been involved in the sharia-housing business since 2015.

Jakarta Police chief Insp. Gen. Gatot Eddy Pramono said the suspects had deceived around 270 people and extorted a total of Rp 23 billion. Of the victims, only 41 people reported the fraud scheme to the police.

“Imagine buying a house without riba and you neither need a banking check nor have to pay interest. It was an attractive offer,” Gatot said as quoted by kompas.com.

Charging interest, riba, is regarded as usury in Islamic law.

“However, the [sharia] housing complex was never built and the buyers became fraud victims,” he added.

Each of the suspects had their own role in their orchestrated business under the name PT ARM Cipta Mulia. AD acted as director while MAA, MMD and SM served as the salespeople.

They allegedly told their customers that they would build five sharia housing complexes in West Java and Lampung provinces, with two in Bogor, one in Bekasi, one in Bandung and another one in Lampung.

Since they made their first sale in 2015 until November this year, they failed to fulfill their promise to the customers and ran off with the money instead, the police allege.

The police have confiscated marketing brochures, payment receipts and saving books.

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Not long after the first case was uncovered, the police in December uncovered a similar fraud and arrested four suspects identified only as MA, SW, CB and S.

The suspects allegedly told their 3,680 victims that they would build sharia-compliant housing complexes in South Tangerang and some other regions in Banten and finish the construction by December 2018.

They managed to extort Rp 40 billion, according to the police.

“They allegedly tantalized their victims with low prices and sharia [payment schemes]. The price was low, without riba and without banking checks. Of the 3,680 victims, we’ve questioned 63 people,” Gatot told the press on Monday.

The suspects named their front company PT Wepro Citra Sentosa. MA acted as the commissioner, SW was the president director, CB was the marketing officer and S, who is MA’s wife, was the financial officer.

MA had the responsibility to plan the housing design. SW, meanwhile, was the one who maintained partnerships with third parties to sell the houses. CB’s tasks were to produce advertisements and marketing brochures and to persuade the potential buyers.

Separately, Jakarta Police crime unit deputy chief Adj. Sr. Comr. Dedy Murti Haryadi said the police were still hunting down two more suspects from PT Wepro Citra Sentosa who acted as marketing officers.

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The suspects from both cases will be charged under multiple articles of the Criminal Code, the 2011 Housing Law and 2002 Money Laundering Law.

In order to avoid similar cases from happening again in the future, Dedy called on people not to be easily tricked by such offers, saying that the public should be skeptical and they should check whether or not the company selling such housing complexes was legitimate.

“People can check the validity of a developer or construction company at the Religious Affairs Ministry and the Public Works and Housing Ministry; whether or not they are registered. They can also check the company’s building permits. It can be done online,” Dedy explained. (vla)