Tuesday, July 10, 2012

Land banking in Georgia, USA

I received an e-mail from this concerned citizen of USA. I am posting the e-mail with all reference to the land banking promoter removed, but indicated below as X. This is to avoid being sued for defamation. Those who have invested in this project will know which is X. If you have been misled into investing in this project, and you wish to take join a group to lodge a complaint collectively, please send an e-mail to kinlian@gmail.com.

For other people, do read the statements presented below carefully. Most land banking schemes follow the same pattern, i.e. the land plots are offered at 10 to 20 times of their actual value.

Dear Mr. Tan Kin Lian,

I live in Jackson County, state of Georgia, USA. This is a small, very rural county about 60 miles from the city of Atlanta. X has been buying up some big tracts of land here and is proposing to develop them for housing and industrial sites, but the land CANNOT be developed -- it's against local zoning laws, and there is no water or sewer service available.

I recently learned that X sells fractional interests in these tracts of land to small investors in Asia through sales offices in Singapore, Tokyo, Kuala Lumpur and Hong Kong. These sales are at crazy prices!

As you probably heard, we had a housing and property bubble here up till 2007, but the bubble popped. Jackson County now has about a 20-year supply of building lots available, and they can be bought for $6000 - $10000 per acre. A 37-acre piece of land next to mine recently sold for $4000/acre. From a brochure I found, it says X is selling these lands to small investors in Singapore, etc. for the price of over $82,000 per acre! 

In Georgia, it's hard for us to believe people would pay stupid prices like this, but here is the data from our county's own tax records showing that over 1,600 Asian investors bought this land at the price of $82,500/acre: 

Here is my question: How can X do this? How can these buyers be so stupid? They will never get their money back. If these investors pass this land on to their grandchildren, it will still never be worth what they paid for it--the county has huge amounts of land that is already zoned for housing and has water and sewer available. These lands are available for MUCH less than the Asian small investors paid.

What is X telling these people, that they will be able to sell at a profit in a couple of years? Or is this a Ponzi scheme, where money from new investors is used to pay off prior investors?

In Georgia, we would like to hear your reply because we are afraid X's landbanking schemes are very harmful to our community, and they may also be harming small investors in your country.

Thank you for your help,

Dear James 

Thank you for your valuable information.

There were many similar land banking schemes sold in Singapore, and the investors have been stuck with the investments. They were probably told that the developer would get approval for re-zoning and the land would be worth 2 to 3 times of their investments. The land never got developed.

Some have complained to the authority, but the authority could not prosecute the promoters. Perhaps, the authority did not have evidence or sufficient resources to investigate the complaints.

There was a recent case involving another promoter who made paid interest at 2% a month and promised to pay back the invested sum after 1 year, and it is linked to some land purchase. This type of arrangement is a ponzi scheme, and the operations were closed by the authority, probably on this account. We have not heard of the case coming to court.

I was threatened with defamatory suit by a prominent legal firm in Singapore acting on behalf of a promoter. I posted an article in the British newspaper about a land banking scheme sold in Singapore. The legal letter alleged that I had defamed their client and asked me to provide evidence to back the allegations that were posted in my blog - which was just a repost of the newspaper article. This matter was settled without any payment from me, and I will not go through the history of that case.

In your particular case, I will post your article and remove all reference to the land banking company. I will also think of some way to give the information to the authority to see if they can take up the matter. 

Tan Kin Lian


Tan Kin Lian said...

Read this earlier blog and the comments

Anonymous said...

Thank you Mr Tan.

Your sharing on these matters is very much appreciated.

Anonymous said...

This my fellow Singaporeans, is a fine example of how a citizen behaves when he stands up for his community and his values of right and wrong.

America allows its citizens to stand up and be counted.
Without questioning their academic qualifications.

Lye Khuen Way said...

Will MAS be interested?
Should be but I doubt they care.
Never had, in my opinion.

yujuan said...


A stranger from rural Georgia, USA,
showed so much concern for some Asians from countries that he might not even be able to find on the world map.
Hope that people here would wake up and start to keep watch of their own hard earned money.
The world's ranking of Singaporeans having the most millionaire households exposes us to wolves from near, far and wide.
Start with the first step, ditch the Trust in others, and we get less chance to be cheated.

Anonymous said...

James asked how can these people be so stupid. My reply to him is that more than half the population in Singapore is daft, and this fact was also stated by the founding father of Singapore.

Anonymous said...

The X Company has got good track records and has deliveded yr. after yr. No doubt about it.

Anonymous said...

$70 million of investors money gone. All left with pieces of worthless paper as the company has filed for bankruptcy...read the news here:


Bottom line is, if the land is so valuable, the local developers would have snapped them up, no need to come half way round the globe to sell to you.

Anonymous said...

If the said land is so valuable and hot, the local folks (maybe bankers at Wall Street) would buy this land like crazy.

Why incur so much cost to advertise and promote this land 10,000 miles away in Asia?

The above are the two reasons why I never invest in land banking from the land far far away. Just hope that those investors will be able to get back their investments with minimal lost.

From investor in HN5

Anonymous said...

The Chairman of this landbanking company came all the way to asia to explained how and why the company ended up in bankruptcy. Watch and listen to what he said and draw your own conclusion....


They can promise you the moon and the stars to get you to part with your money but all you really get at the end of the day is a piece of worthless paper and lots of excuse and reasons as to what went wrong and how things are beyond their control.

Even guarantees written in black and white, notorised, signed, stamped and sealed also is of no use. All they need to do is file for bankruptcy and that's it! Even if you sue them you ain't going to get a single cent back.

Anonymous said...

Mr Tan, please circulate this video to everyone so that they are more aware of the real consequences of such fanciful invetsment:


Anonymous said...

Mr Tan, pls also send this out to everyone and especially to those who are selling such dubious investment products to their close friends and families. Very sad...it can destroy lives!!!


Anonymous said...

Land banking = Scam

Regulator should pay attention before implosion.

Oops, does not apply for MAS. They have to wait for Chairman approval to investigate. Feedback is useless. So, good luck for those who are involved. At least you have been warn by TKL not to get involve in landbanking long time ago.

MAS = ANC [Action Never Come]

Anonymous said...

There is another last year's news related to the land banking company :


I hope someone will investigate this also.

Jp69 said...
This comment has been removed by a blog administrator.

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