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Muslim Entrepreneur Network investors speak out as co-founders clash over alleged fraud

PUBLISHED: 07:00 20 February 2019 | UPDATED: 13:35 25 March 2019

Members of the Muslim community have spoken of their fraught experience with the global “investment” scheme called Leverage, which scores of households in North and East London paid into.

On Monday we reported ongoing fallout over the scheme run by the Muslim Entrepreneur Network, which has prompted at least 18 complaints to Action Fraud.

Members left the scheme in droves over 2018 after being promised a profitable business within 12 months that had not materialised, even after they put in hours of unpaid work.

Many have received money back and the founders said everyone entitled to a refund has had one, but a number of people say they are still waiting.

At the same time the embattled scheme now appears to be undergoing a restructure and the founders have publicly clashed over their version of events.

“There’s no closure”: Former Leverage members speak out

A total of 990 people from the UK took part in the scheme, and more than 300 in London, while large numbers also paid in across the Home Counties, the West Midlands and Yorkshire.

They came from all walks of life, from stay-at-home parents who gave all their savings to take part, to NHS staff, financiers and Government employees.

A 27-year-old from Bethnal Green, who asked to be known as Maksud, forked out £10,000 along with a friend to be part of the first round of investors, dubbed the L300.

Apart from sporadic £200 “gifts”, he said he had had no refund and seen no evidence of any profitable business coming out of Leverage.

He said: “This was my hard-earned money and they made a categorical statement that you’d see a return on your investment in a year.

“The business model made sense but no actual business was built. You were sold a product you didn’t receive.

“It’s left me so stressed, it’s ridiculous. My baby was born about six months ago, I can’t see any way of getting my money back and the civil court is going to cost me an arm and a leg.”

A 40-year-old woman from the L300, who asked not to be named, reported a psychological as well as a financial cost after leaving her job to work on Leverage projects.

She invested £6,000 in total, more than her life savings, and then worked extended hours writing 1,200-word articles for the fitness franchise, even while fasting over the holy month of Ramadan.

She said: “They were showing us dreams and bringing God into it.

“Every other word was a religious word. It all sounded amazing and was something I really wanted - unity, and other Muslims I could be close to and work with as a team.

“But nothing happened. We never saw anything, anywhere.”

“It was a hollow dream that went into nowhere. Even after leaving we were still hanging onto something. You can’t let go, and there’s no closure. I’ve given up on myself and I can’t motivate myself to go back into work.”

Nabil Madar, a 27-year-old L300 member from Leyton, said he had signed up because of MEN director Haroon Qureshi’s good reputation as a businessman on Amazon.

Overall he invested £3,800 and said that when he asked for it back, he was told that the ‘refund period’ had ended.

He said: “The atmosphere early on was electric. It was so hyped. I put so much trust in these brothers [my fellow Muslims] and went home thinking ‘I’m so ready for this’.

“It was too good to be true and I had to go around telling people it was a flop. It’s embarrassing. Not getting my money back is a big thing; I could really use that £3k right now.”

The types of documentation offered to Leverage members varied, with nothing extended in the first year and some reporting not seeing a contract at any time.

At some stage an ‘Undertaking’ was issued asking them to agree to hand over personal details and “refrain from any remarks or comments that are detrimental to collective Unity”.

Another names Arif Mirza - the Mirza brothers’ younger sibling - as the programme manager and states they are entering into an agreement with his company.

People asking for refunds were also given a set of terms to agree to electronically, which include not disclosing information about Leverage in the future.

One of the L300 was a 40-year-old who together with his wife invested £6,500 in Leverage, in Rocky Mirza’s spin-out Kidbizo and Habibi Coin, one of Com Mirza’s ventures.

He said: “If we don’t get it back it’s a substantial blow. We put our children into private school and hoped we would make a profit; we received no profit, so we had to take the kids out.”

The couple eventually signed an agreement in April 2018, but even then did not get a copy themselves.

The investor said: “There was a complete lack of professionalism. They weren’t signing tasks or showing financial transparency. The big thing was teaching us but we didn’t learn anything.

“They would cold-call Leverage members without realising they were already members.”

Another investor, a 34-year-old from Barking, is still waiting for a refund on the £19,000 they paid into Leverage and two of the Mirza brothers’ spin-out enterprises.

They told us they had been “apprehensive” from the start, but were convinced by the founders’ apparent track records in business.

They said: “Most people in Leverage are your average, lay person who didn’t know better. They specifically targeted the Muslim market and the wording used was really powerful.

“When the co-founder and ex-CEO came out publicly I thought ‘This is some deep crap’. I don’t even know if they have a team anymore.”

This person and their spouse are no longer convinced they will see a penny of their money back. But they added: “That’s not even the concern anymore. It’s a moral duty.”

How was the scheme promoted?

Hours of video footage seen by this newspaper shows how MEN got would-be investors on board.

They were targeted on social media and with promotional videos as well as through mailshot-style advertising, online ‘webinars’ and Skype videos.

Haroon Qureshi, now 30, who has 115,000 followers on Facebook, promised the original L300 “an automated income that will exceed your 9 to 5 job for the rest of your life.”

An email to MEN members on January 6, 2017 headlined “IMPORTANT NEWS!!!” advanced the same premise, concluding: “This is seriously a life time opportunity!”.

In the September 2017 recruitment ‘webinar’ for the L500, Mr Qureshi appears to suggest to members ways to stump up an initial £1,500, stating: “I’m sure a lot of you have gold… you have an asset, you have a car or something”.

In the same video Mr Mirza told would-be L5000 investors: “Stop thinking with your brain, start thinking with your heart.

“Collective economy is going to change your life. You are never going to be alone. You are never going to do anything by yourself. You are never going to not know what to do and what not to do... We are not going to leave anyone behind.”

Appeals to religiosity and the Islamic faith were also used by MEN and its proponents to first justify and later exonerate the programme.

In a 2017 ‘webinar’ Mr Qureshi said: “Allah chose for you to be here. There were literally hundreds of thousands of people who had the opportunity to be on this webinar today. Allah chose you.”

He added: “When we look at the lives around the people of the Prophet Muhammad, peace and blessings be upon him… they were aiming to be among the richest people on earth. Why? Because money is power.”

Further down the line, as Leverage members begin to question the scheme, Mr Qureshi appeared to compare his rationale to that of the Prophet Muhammad.

In a video appearance he told members: “People sometimes ask ‘When is the money coming?’. I tell you one thing: the Prophet Muhammad was once asked ‘When is the day of judgement?’. Did he say ‘This place, this place, this time’? He didn’t. He asked, “What have you done for that time?”.”

He separately compared Leverage members to the original Islamic community, who he said were “results-forward” people who overcame “the negativity”.

Mindset and the willingness to be decisive and take risks were repeatedly identified in MEN’s marketing as the key to “financial freedom”.
Slogans such as “Unity” and #WeAreOne also fostered a sense of community among Leverage members, compelling many to stay on the programme.

In one video issued after accusations began to mount, Mr Mirza told viewers: “People can’t understand Leverage. It’s a different animal.”

“Burn the ships”: What’s happening now?

In January this year remaining Leverage members were informed that a new company, Figtree Holdings, had been established to handle the scheme’s remaining assets.

In a live video seen by this newspaper Mr Qureshi told followers Leverage was “a mission we are on. We don’t have a choice. There’s no turning back.”

To back this up he told the story of the 8th century Muslim commander Tariq Ibn Ziad, advising viewers now was the time to “burn the ships”.

Figtree Holdings has been registered on Companies House and existing Leverage members are now being asked to take over the company as directors and shareholders.

Two ventures still linked to Leverage are Launchroid, Haroon Qureshi’s series of online business-themed videos, and Kidbizo, a venture led by Rocky Mirza claiming to educate children in entrepreneurship.

Kidbizo is an affiliate of Sports Content Provider Ltd, whose sole director is Mr Mirza’s wife.

Its “risk-free” cryptocurrency spin-out, Kidbizo initial coin offering (ICO), identified itself online as a subsidiary of a technology company based in Romford which had Arif Mirza and a family friend listed as directors.

It is not known how many people have invested in either Kidbizo or its ICO.

But Leverage members were among those who signed up and in one video, Mr Qureshi claimed buy-ins had reached “literally hundreds of thousands of pounds”.

Who are the Mirza brothers?

Throughout the programme Rocky Mirza was cited as the driving force behind Leverage.

The 46-year-old was born in Pakistan and now lives in Ilford, and is credited as being the founder of a string of online ventures going back to the 1990s.

In a 2017 brochure for Leverage several of his and his brothers’ ventures are referred to as Leverage’s “investments/companies”.

They include Weblo.com, a website selling virtual versions of real estate, and Directly.me, a monetised version of Linkedin launched in 2011 that according to Companies House records has no staff and is still under development.

Houser, an online property portal, was registered in Dagenham in 2015 and went on to list a number of agents’ properties without their permission.

It was reported that the residential director of Savills accused Houser of “attempting to scrape our listings and data.” It was also rapped by the Advertising Standards Authority in 2017.

An online gambling platform, iBetX, was reviewed under caution by the Gambling Commission in late 2012, and after it surrendered its operating licenses a High Court restriction was granted to an ex-business partner stopping Mr Mirza from selling a house in Barking without his permission.

Arif Mirza, Rocky Mirza’s Dubai-based younger brother and a key beneficiary of MEN members’ cash, also claims on his website to be the person behind Directly.me - described as a “blue ocean” and “the true child of the Idea Economy”.

Com Mirza has a stronger social media presence than his brothers and has featured in Forbes Magazine, claiming to be worth $500m and live in the Burj Khalifa in Dubai.

Two of his recent ventures, Intentional Success Group and Habibi Coin, are mired in controversy after ex-partners publicly expressed concern that they had colluded in a scam.

Habibi Coin was marketed specifically to the Muslim community as a real estate-backed cryptocurrency and Leverage members were encouraged to buy in.

On January 28, 2019, an email to investors announced that Habibi Coin was being acquired and “a cash and token swap deal” - ie, a means of getting money back - would be up to “the company acquiring us”.

Dan Brown, an ex-founding partner and associate, told this newspaper: “I was concerned that statement is all smoke and mirrors and there is nobody working on Habibi Coin or the underlying business.”

Another ex-partner, Jagger Babuin, who openly admits to having previous convictions for fraud, said he and his family had invested $1million into Habibi Coin.

He said: “Our initial event for Habibi launched in Panama city in July of 2017. Over the next few months I grew increasingly frustrated at the lack of actual progress.

“We believed Habibi was simply a money grab. I went to Com’s office and confronted him.”

Com Mirza denied all the allegations presented to him and said he could not comment further as legal proceedings were ongoing.

What the architects said

The co-founders of MEN have clashed in their version of events, while Mr Mirza has said he is taking legal action against “a welter of fantastical allegations”.

When approached by this newspaper, Harun Rashid, who made a dramatic exit from MEN on social media last year, claimed he had become embroiled in a “web of lies”.

In its early years, he said, MEN had provided good value for money to subscribers before taking a drastic change of direction in 2017.

He said: “By mid-2017 we had earned millions in subscription fees into Leverage.

“I had a creeping suspicion that the money we had collectively earned, and was a trust from investors, would disappear.”

Acting as CEO, he said, he was responsible for raising seed investment for Empty Trip - a venture he said later proved to be “a black and white cash cow”.

He acknowledged he was responsible for bringing others into the scheme, claiming he had been “too at awe” to question the business model at the time.

He said: “Although looking back now it was always unclear and ambiguous, at the time it seemed like [Rocky Mirza] was unquestionable.

“I want the public to know that I believed in Leverage. I have come to realise that Leverage as an idea is just a mirage. There is no product and no service.”

By contrast, Mr Qureshi, who is still involved in Leverage, insisted that all of its operations were legitimate and all the money sent abroad was to procure services for the business.

Despite having referred to joining Leverage as “investing” in his own promotional material, he said it was not an investment scheme but a “membership programme” that was “member-driven, inclusive and democratic in nature”.

He did not dispute that the promised profitable businesses for the L300 had failed to appear, but said this was because of the democratic nature of MEN.

He told us: “Our early endeavours to ensure we provided each and every member with a voice was in hindsight a significant obstacle in the growth of the programme.”

The abandonment of the fitness franchise, he and Rocky Mirza said, was due to some members holding conservative religious positions.

Both he and Mr Mirza said that all the refunds due according to Leverage’s terms of service, that was, those that people asked for within the first 12 months, had been paid.

Rocky Mirza also confirmed that in the first 12 months no Leverage member had sight of a contract, but said the terms of service had been set out online.

He also said payments to MEN from Empty Trip were for the office space and operational costs that one business was providing the other.

In his response to this newspaper, Mr Mirza appeared to distance himself from the programme, stating: “My background is as a tech sector entrepreneur, which allowed me to provide unpaid consultancy to MEN on a variety of issues, including Leverage.

“The nominated directors of MEN had to make any business decisions concerning that company.”

Over the course of 2018, he said, MEN had come under “sustained and orchestrated attack” from a range of actors without hard evidence.

He added that disgruntled ex-employees were responsible for a “propagation of misinformation and falsehoods” that had led to people demanding refunds, and suggested the original terms presented to would-be investors had been misunderstood.

He said: “The point of Leverage was to pursue collaborative working on tech start ups.

“It would be unprecedented for a tech startup to become highly profitable or saleable in twelve months.

“Those who believe that successful technology companies can be developed to profitability in around 12 months are naive.”

Have you been affected? Get in touch with the Investigations Unit in London by emailing hannah.somerville@archant.co.uk

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