Kris Agrawal was the go-to advisor for many in his orbit. When Yogita Patel needed a home loan, fellow temple-goers encouraged her to seek his help. He was Rajeev Kumar’s mortgage broker, financial advisor and accountant. Others turned to him to help build their dream home.
Three years ago, Mr Agrawal began developing properties, offering his friends and loyal clients enticing returns on investment in his projects across western Sydney.
More than 150 mum and dad investors sunk almost $60 million into the scheme – money they fear they may never see again after the shocking collapse of several companies connected to Mr Agrawal and his wife Shashi.
“It’s gone, my money is gone,” Mrs Patel said.
“I don’t think … it’s coming back.
“Everything is messed up.”
Mrs Patel has been her family’s sole earner since her husband was brutally bashed in 2010, an attack that left him with a severe brain injury and unable to work. She had her own health issues and was worried for her family’s future when Mr Agrawal – her financial advisor of about a decade – suggested she invest in a housing project at Castle Hill.
“He told me I will pay you back 12 per cent interest a year, and at the moment, whatever I’m earning, I would get double than that,” she said.
“So I just trust him.”
Mrs Patel received some interest on her initial investment, but she cries as she recalls the company’s demise. It went into voluntary administration in June.
“I got the email and I told him in my language, ‘Did you lose all my money?’ and he said, ‘Yes,'” Mrs Patel told 7.30.
“I was so shocked I just literally drop on the floor.”
Money loaned through web of companies
The Agrawals sit at the top of a complex web of companies and trusts, many of which have gone into voluntary administration or liquidation.
Olvera Advisory principal Mirzan Mansoor has been appointed external administrator of five of the companies. Key among them is Mansa Sons, which was effectively the fundraising arm for the couple’s planned property projects.
Mr Mansoor explained money loaned to Mansa Sons by people like Mrs Patel was then on-loaned to a network of companies responsible for property purchase, construction or development.
“It’s a very complex scheme,” Mr Mansoor told 7.30. “We’re working to understand… where the destination of these funds are.”
A series of WhatsApp messages, seen by 7.30, showed Mr Agrawal requesting large sums of money from various contacts earlier this year.
“Have you transferred $200K,” he said in March.
In another message from April, Mr Agrawal urged an investor to make a deposit into a Mansa Sons account.
“Saheb — $170K or more transfer karo in Mansa,” he said.
Two weeks later, another request: “I need money urgently, can you transfer into SMSF [self-managed super fund] and transfer to me please.”
Administrator Mr Mansoor said his team was working “around the clock” to try to recover funds for creditors.
Mansa Sons does not itself hold any property, but several other asset-holding companies connected to the Agrawals have been handed over to other administrators. They’ve identified at least 12 properties across Sydney’s west and north-west linked with Mr and Mrs Agrawal’s network of companies.
“At this stage, we aren’t able to give…the quantification of the return and the timeline as to when the funds can be recovered,” Mr Mansoor said.
“I understand it’s a very stressful situation for [investors and] their families … but please be rest assured that we will be doing our very best.”
Administrator Cathro and Partners, which is overseeing three more companies connected to the Agrawals, has identified an additional $44.4 million in debts – about half of which is owed to everyday investors. It brings the couple’s total debts to more than $80 million.
ASIC investigation underway
Mr Mansoor confirmed he had submitted a confidential report about Mr and Mrs Agrawal’s network of companies to the corporate regulator, ASIC.
An ASIC spokesperson said the agency was investigating the matter.
“While ASIC can’t go into detail about specific complaints we have received, we can confirm that this matter involves persons and entities of interest to ASIC,” the spokesperson said.
“We have commenced a formal investigation, which remains ongoing.”
For creditors, action can’t come soon enough.
Rajeev Kumar saw Mr Agrawal like a brother. The pair met in 2014 when Mr Kumar needed a mortgage broker, then Mr Agrawal became his financial advisor and accountant. Their families spent time together, including a dinner at Mr Kumar’s home when Mr Agrawal’s parents visited from India.
In late 2020, Mr Agrawal encouraged Mr Kumar to buy into his developments, citing strong returns for past investors.
Mr Kumar estimates he invested more than $1 million in the scheme. He told 7.30 he and his wife have nothing left in their superannuation fund.
“My message to Kris is, you have to pay our money back,” he said.
“We need our money back — everyone.”
Mr and Mrs Agrawal did not respond to calls, texts or emails from 7.30. The property listed as their business address has been put on the market for sale.
TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in technology, financial and energy stocks, while U.S. stock markets also pushed higher.
The S&P/TSX composite index was up 171.41 points at 23,298.39.
In New York, the Dow Jones industrial average was up 278.37 points at 41,369.79. The S&P 500 index was up 38.17 points at 5,630.35, while the Nasdaq composite was up 177.15 points at 17,733.18.
The Canadian dollar traded for 74.19 cents US compared with 74.23 cents US on Wednesday.
The October crude oil contract was up US$1.75 at US$76.27 per barrel and the October natural gas contract was up less than a penny at US$2.10 per mmBTU.
The December gold contract was up US$18.70 at US$2,556.50 an ounce and the December copper contract was down less than a penny at US$4.22 a pound.
This report by The Canadian Press was first published Aug. 29, 2024.
The crypto market has recently experienced a significant downturn, mirroring broader risk asset sell-offs. Over the past week, Bitcoin’s price dropped by 24%, reaching $53,000, while Ethereum plummeted nearly a third to $2,340. Major altcoins also suffered, with Cardano down 27.7%, Solana 36.2%, Dogecoin 34.6%, XRP 23.1%, Shiba Inu 30.1%, and BNB 25.7%.
The severe downturn in the crypto market appears to be part of a broader flight to safety, triggered by disappointing economic data. A worse-than-expected unemployment report on Friday marked the beginning of a technical recession, as defined by the Sahm Rule. This rule identifies a recession when the three-month average unemployment rate rises by at least half a percentage point from its lowest point in the past year.
Friday’s figures met this threshold, signaling an abrupt economic downshift. Consequently, investors sought safer assets, leading to declines in major stock indices: the S&P 500 dropped 2%, the Nasdaq 2.5%, and the Dow 1.5%. This trend continued into Monday with further sell-offs overseas.
The crypto market’s rapid decline raises questions about its role as either a speculative asset or a hedge against inflation and recession. Despite hopes that crypto could act as a risk hedge, the recent crash suggests it remains a speculative investment.
Since the downturn, the crypto market has seen its largest three-day sell-off in nearly a year, losing over $500 billion in market value. According to CoinGlass data, this bloodbath wiped out more than $1 billion in leveraged positions within the last 24 hours, including $365 million in Bitcoin and $348 million in Ether.
Khushboo Khullar of Lightning Ventures, speaking to Bloomberg, argued that the crypto sell-off is part of a broader liquidity panic as traders rush to cover margin calls. Khullar views this as a temporary sell-off, presenting a potential buying opportunity.
Josh Gilbert, an eToro market analyst, supports Khullar’s perspective, suggesting that the expected Federal Reserve rate cuts could benefit crypto assets. “Crypto assets have sold off, but many investors will see an opportunity. We see Federal Reserve rate cuts, which are now likely to come sharper than expected, as hugely positive for crypto assets,” Gilbert told Coindesk.
Despite the recent volatility, crypto continues to make strides toward mainstream acceptance. Notably, Morgan Stanley will allow its advisors to offer Bitcoin ETFs starting Wednesday. This follows more than half a year after the introduction of the first Bitcoin ETF. The investment bank will enable over 15,000 of its financial advisors to sell BlackRock’s IBIT and Fidelity’s FBTC. This move is seen as a significant step toward the “mainstreamization” of crypto, given the lengthy regulatory and company processes in major investment banks.
The recent crypto market downturn highlights its volatility and the broader economic concerns affecting all risk assets. While some analysts see the current situation as a temporary sell-off and a buying opportunity, others caution against the speculative nature of crypto. As the market evolves, its role as a mainstream alternative asset continues to grow, marked by increasing institutional acceptance and new investment opportunities.