Grand jury: Pure was a Ponzi scheme

Pure, 24 S Morgan St, Chicago

Anyone who has followed the story of Pure over the past two years knows the building is anything but. Today, a federal grand jury indicted the developers of the building, located at 24 S Morgan St in the West Loop, with running a Ponzi scheme that cost banks and investors close to $44 million.

According to Crain’s, Sunrise Equities owners Salman Ibrahim and Mohammad Akbar Zahid pulled in money from hundreds of Muslim buyers by promoting Pure’s compliance with Islamic laws prohibiting the collection and payment of interest, then used the money to pay off earlier investors and to invest in a suburban gas station and a Pakistani motorcycle parts manufacturer.

Ibrahim, Zahid, and a third partner, Amjed Mahmood, are also charged with defrauding the Mutual Bank of Harvey, Cole Taylor Bank, and Devon Bank, which loaned them almost $30 million in total for Pure and two other projects, the proposed Pure2o in Uptown, and another project planned for the Near West Side.

Late last year, I posted a roundup of Pure’s problems to date, from the reports of Ibrahim’s disappearance in September 2008 to the look of the West Loop tower on a cold December night.

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