Macau’s Court of Second Instance has ruled an investment scheme offered by a junket operator was in fact a loan, and must be repaid, TDM reports.
According to the news outlet, in 2009, junket operator Cheong Wai Leng was offering returns of 3 percent a month in return for “investment” in the junket operator’s business.
However, interest payments soon started to “dry up”, and Cheong closed her VIP room at Grand Lisboa in November of the same year.
The investor never saw her money back, and at the time, Cheong argued that just like any investment, there were risks.
However, a verdict by the Macau court made public last week, said while the contract is titled as an investment, it does not hold any relation to an investment scheme.
“In fact, although the related contract is titled as investment, there is nothing related to an investment purpose, at all”, the court said.
“If it is really a type of investment, then why the plaintiff need not bear any financial loss?”, it asked.
Additionally it asked:” Why is he not sharing the profits based on the investment ratio, and why is there such as thing as 3 percent interest, regardless of whether there is a profit or not?”
The court also ruled that it couldn’t be considered a deposit, because only banks are allowed to take on deposits.
Cheong Wai Leng has been ordered to pay back the HK$2.5 million ($322,252), plus interest that was invested by the investor.