Rehda: Halt legal services, loan financing for property projects without approved license

KUALA LUMPUR: The Real Estate and Housing Developers' Association (REHDA) Malaysia urged the government to halt legal services and loan financing for projects without an approved advertising permit and developer's license (APDL).

 Rehda Malaysia President, Datuk NK Tong said the association is cognisant of the issues surrounding abandoned projects by individuals claiming to be developers.

  Highlighting the complicity of errant lawyers and loan officers, Tong asserted that these projects wouldn't progress to abandonment without their involvement. 

  "Legal services and loan financing offers should have been halted for projects without approved APDLs such as these.

  "We believe that the responsibility should fall on these lawyers and loan officers to report such activities to the authorities. Their involvement should be investigated, and action should also be taken against them and others who play their part in abetting such crimes," he said.  

  Tong described the issue as critical to both the public and the property industry.

  He said the association is eager to collaborate with the Ministry of Housing and Local Government (KPKT), relevant state authorities, and the police to eliminate illegal projects prone to abandonment.

  "We are confident that if all parties work together towards this effort, these illegal activities will no longer be a part of the property industry landscape moving forward," he said.

  Tong said Rehda Malaysia is also aware of the alarming pattern of people claiming to be developers and then giving up on projects.

  He said this in reference to a recent report, which stated that between 2021 and 2023, there were 88 cases related to criminal breach of trust by lawyers, with a staggering loss of RM88.35 million.

  Bukit Aman Commercial Crime Investigation Department (CCID) director Datuk Seri Ramli Mohamed Yoosuf reportedly said that as of Jan 24, 2024, an additional eight cases had been recorded, amounting to a loss of RM7.4 million.

  Tong expressed appreciation for the proactive stance of authorities, including law enforcement, in addressing these deceptive practices to safeguard the public from unscrupulous activities. 

  "We hope that authorities remain vigilant and take measures to the full extent permissible by law against these individuals masking as developers," he said.

  At the same time, Tong said the association acknowledges the challenges faced by KPKT and state authorities in tackling several issues, including detecting projects before abandonment. 

  He noted the difficulty in monitoring projects in rural and suburban areas or small-scale developments that may evade detection.

  "There is also the possibility that the units are misrepresented and built under the pretense that they are for the builder's self-dwelling purposes.

 "More often than not, these individuals masking as developers are also operating without any APDLs, so tracking them is understandably hard. 

  "As a result, taking appropriate and timely action is a herculean task, although we are confident the Ministry will find the appropriate measure to curb this before it worsens," he said.

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