Scam involving Australian property

A lawyer told me about this scam involving Australian property. A developer marketed the property in Singapore through a Singapore property agent. The property carried a rental guarantee which was provided by another company, having a similar name to the developer, but with no funds to back the guarantee.

On completion, the invetors did not get the guaranteed rental. The company that provided the guarantee declared insolvency.

The Australian banks that provided the 70% loan to the Singapore investors took over the property at a discount of 30%. The Singapore investors lost the 30% that they invested.

The Singapore investors went to see the property agent, who said they were only marketing the property to earn a commission, and was not responsible for the loss.

Lesson: Never invest in overseas properties, even with rental guarantee. The risk is too high.