As more South Africans seek answers about the Al Mabroor investment scheme, Attorney Zehir Omar says the next phase of the matter may depend as much on affected investors as on regulators.
Speaking on the unfolding case, he argued that legal avenues remain available, but warned that meaningful progress will require investors to come forward, submit evidence and cooperate with the authorities.
Al Mabroor, which marketed Sharia-compliant investment products across sectors including agriculture, property and vehicle finance, entered business rescue after reporting financial and liquidity challenges. The development left many investors seeking clarity over the status of their investments and prompted calls for regulatory intervention and legal action.
According to Omar, such schemes can exploit trust within communities, making careful due diligence even more important.
Concerns over the scheme’s legal standing
Omar argued that Al Mabroor did not operate within South Africa’s regulatory framework for institutions that receive public investments. He said businesses that accept deposits or investment funds are required to comply with strict legal requirements, including oversight by the South African Reserve Bank and the Prudential Authority.
These safeguards exist to protect investors through regulatory supervision and financial scrutiny. Without them, investors have fewer protections when problems arise.
Allegedly, the scheme promised returns that exceeded those typically available through regulated financial institutions, something Omar believes should have prompted greater caution among prospective investors.
SMread: SANTACO threatens shutdown as MEC dispute deepens
Investors urged to report their losses
A key concern raised by Omar was what he described as a lack of formal complaints from affected investors.
He claimed the Prudential Authority had not received affidavits from investors confirming their losses, despite widespread discussion of the matter. These affidavits are an important step in strengthening any regulatory or legal action against those responsible.
Omar encouraged investors to document their losses formally and submit statements to the relevant authorities rather than relying only on public discussion or informal complaints.
SMread: No vote is wasted: IEC challenges voter apathy
Debate over legal representation
Omar also criticised calls for legal work to be conducted entirely on a pro bono or contingency basis.
South Africa’s legal framework limits access to state-funded legal assistance to individuals who meet strict financial criteria. Omar questioned whether contingency arrangements would be appropriate in a matter of this nature.
He said affected investors should seek qualified legal advice before deciding how to pursue recovery of their funds.
Proposed legal action and public demonstration
Omar intends on pursuing legal action aimed at compelling the Prudential Authority to fulfil what he believes are its statutory obligations.
He has also proposed organising a public march to the offices of the Prudential Authority. According to Omar, the demonstration would seek to encourage affected investors to submit affidavits collectively and to call for stronger enforcement against those allegedly responsible for the scheme.
Public participation could place greater attention on the matter while demonstrating the scale of concern among investors.
SMread: Deportations fuelling a hidden health crisis
Questions over undeclared funds
Questions were raised about whether some investors may have been reluctant to come forward because their investments involved undeclared income.
Omar acknowledged that this possibility had been suggested but argued that avoiding legal processes could ultimately create greater risks if financial records later come under scrutiny during official investigations.
Investors should not assume remaining silent would protect them from future enquiries.
Class action seen as unlikely
A formal class action would not be the most practical route.
Instead, Omar suggested that a conventional civil case involving multiple applicants would likely provide a faster and more straightforward legal process. He believes existing legislation already provides mechanisms to pursue those allegedly involved in operating an unlawful investment scheme.
SMread: A decade on, Türkiye remembers failed coup attempt
Advice for future investors
Looking beyond the Al Mabroor matter, Omar urged members of the public to investigate any investment opportunity thoroughly before committing money.
He advised prospective investors to seek guidance from qualified financial professionals and recognised religious scholars where investments are marketed as Sharia compliant. He also recommended verifying whether investment providers are properly registered with the relevant financial regulators.
Promises of unusually high returns should always prompt careful scrutiny. While attractive profits may appeal to investors, independent verification and regulatory compliance remain essential safeguards against financial loss.
For more information about the scheme, watch the video below:
Image: GETTY IMAGES/ISTOCKPHOTO FILES
