A fake investment app called JawaEye has conned thousands of Pakistanis out of their hard-earned money, with estimates suggesting that the total amount lost could be as much as Rs. 25 billion.
The app, which claimed to be based in Indonesia, operated a Ponzi scheme, enticing unsuspecting users with the promise of lucrative profits. Although the app has now been removed from Google Play, it was being used by thousands of people across Pakistan, each investing a minimum of Rs. 15,000 as a sign-up fee.
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The app primarily operated through its website rather than its Google Play version, which was likely only to build trust among customers. Despite having a dubious description on Google Play, the app had hundreds of videos on YouTube and dozens of groups on Facebook promoting it as a legitimate earning opportunity.
The Ponzi scheme required users to spend $50 to sign up, after which they started earning from the app. However, earnings were so low that it took months for people to break even, and during that time, they were offered higher profits to lure others to sign up.
The recent policy changes announced by the app and the subsequent halt in profits alerted customers, but it was too late by that time. The app became less responsive as panicked customers looked for answers. Recent Google reviews on the app show how customers gradually realized that they were being scammed in recent days, with most customers warning others against investing in the app.
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The Securities and Exchange Commission of Pakistan (SECP) had taken up this matter with Google and requested that only registered apps with relevant regulators such as the State Bank of Pakistan (SBP) or SECP be placed on the Play Store. However, the fact that the app was operating in Pakistan for months without any action being taken raises serious questions about the performance of relevant departments.
It is important to note that an unlicensed app cannot provide financial services unless it is registered with the relevant departments. Recently, FIA Faisalabad has also registered an FIR against some individuals in District Sahiwal who are involved in this business.
The FIR states that criminal groups are engaging in illegal foreign currency trading in Sahiwal, and they have installed various investment-related apps on their phones and transferred remittances through Hawala or Hundi using unauthorized local agents in different cities.