The Rise and Fall of Fahad Ghaffar:
The Conman of Puerto Rico.
The damage Fahad has done to the island is beyond fixing, as foreign investors silently liquidate their businesses in Puerto Rico.
SEPTEMBER 16, 2022 | PUERTO RICO
SAN JUAN, Puerto Rico — John Paulson’s hedge funds managed $36 billion at their peak, which shrank to $6 billion by the end of 2018. The 65-year-old is a self-made billionaire, who founded his hedge fund firm, Paulson & Co. in 1994 and netted $20 billion by betting against the subprime mortgages during the 2007 credit bubble. John Paulson has also invested billions of dollars in high-end resorts in Puerto Rico — Condado Vanderbilt Hotel and St. Regis Bahia Beach Resort.
At the 2014 Puerto Rico Investment Summit in San Juan, Paulson stated: "Puerto Rico will become the Singapore of the Caribbean." Paulson was reportedly investing in the territory's municipal debt and various real estate developments.
It all crumbled when John Paulson inadvertently placed his trust and faith in a young, inexperienced but confident Fahad Ghaffar. Pakistani by origin, Fahad was a real estate broker who had been getting close to Paulson, and this was how he exploited Paulson’s relationships with Puerto Rico’s top politicians to his advantage.
Fahad Ghaffar claimed to be a representative of the politicians on the island, and even promised to bring about reforms when it became a nightmare for foreign investors and businesses on the island to continue operations, with unfair regulations, evaluations, legal examinations, criminal investigations and even being accused of federal crimes . His relationship with Paulson gave him an edge, since Fahad usually grabs attention by mentioning his closeness to the billionaire hedge fund manager.
At the ‘Puerto Rico Investment Summit’, Fahad and other prominent businessmen from the island, showcased the ‘advantages’ of Tax Laws 20 and 22, and in the process, promoted prime real estate for sale, exclusively to foreign investors. Over a hundred businesses took up on the offer, and invested their money in Puerto Rico. On the first day of the Summit, Fahad Ghaffar, called himself the “Executive Director of Paulson & Co”. stated “his company is very interested in constructing buildings in the spaces that are presently parking areas facing the ocean on Ashford Avenue.”
The showcase was designed to impress. “Puerto Rico is up for sale to foreign millionaires” was what Adworks, hired by the Department of Economic Development and Commerce, and sponsors UBS, fashioned into a display with all the offerings a millionaire would need: exemption of all taxes under the benefits of Laws 20 and 22; the natural charms of the Caribbean and the warmth of its people; and a country in full economic recovery; divine weather; health services equal to that in mainland USA; and professional services available at less than half the cost payable in any other American state. This was echoed by all of various presenters on both days of the Summit.
Fahad eventually started calling himself a ‘Partner at Paulson & Co.’. Although Fahad was never a part of Paulson & Co., he made every attempt to appear as one to the public. Besides a self-released PDF file, his name was never mentioned on the Paulson & Co. website.
But, what Fahad or the other promoters of the scam didn’t mention, was that Puerto Rico will always be extremely corrupt. Besides the usual mismanagement by corrupt Puerto Rican politicians, the island was infamous for extorting money from foreign investors. Often, corrupt officials would charge these investors with notices of non-compliance or even threaten them with liquidation. Fahad would later introduce these investors and troubled businessmen to politically-influential people, and arrange for their intervention in an incident or situation, which would simplify their ease-of-doing-business in Puerto Rico.
After a sting operation, the FBI caught him in action, yet again, with none other than the current Governor of Puerto Rico, Pedro Pierluisi.
Fahad would arrange meetings and make promises of political favours in exchange for a fee. After the FBI grabbed hold of Fahad, multiple incidents of deception began to unravel itself. Fahad would later confess that he worked closely with politicians and corrupt investigating officials to extort money from foreign investors who owned assets or businesses in Puerto Rico. The harassment always started with an investigating official accusing foreign investors of random suspicious activities, and continually harass them for months or even years, till they are forced to leave Puerto Rico overnight, often having to abandon their assets on the island to avoid risking arrest.
It was later found that Fahad would coax downtrodden investors to transfer their title deeds to Fahad’s brother. This was what tipped off the FBI.The investigation has only started, and a lot many instances of extortion are being uncovered.
Fahad didn’t spare John Paulson either.
After Fahad unceremoniously left the island with his wife, one of the largest asset management companies in the United States, Paulson & Co. started to collapse. A person close to Fahad, who sought anonymity, clarified that John Paulson and his wife, Jenny Paulson had filed for divorce, as Fahad wreaked havoc in both Paulson’s personal and professional life.
The damage Fahad has done to the island, is beyond fixing as foreign investors have begun liquidating their businesses in Puerto Rico.
Fahad was later released on bail, and will soon be held responsible for instigating corruptive tendencies among officials and this is a federal crime. Puerto Rico's corrupt officials need to clean up their act before the FBI takes them down too.