Validus Training Academy based in Dubai: Shariah Compliant?
Question:
I’m reaching out today with regard to a financial programme that has been shared around by many people here in New Zealand.
There have been a few workshops and it has been advertised in a way to buy your first house without paying Riba.
The manner in which it works is, you put your money in and see compounding bonuses of the amount you put in; the more you put, in the more you get back. The people who invest don’t have to do anything and will see a 300% return within a few months.
It has been endorsed/certified by the Shariah Supervisory Board.
Certified on 23/01/2022 – XSS/23949/ASP
Product is called: Validus Shariah Product
Global Islamic Financial Services
It’s been backed by scholars in Australia and also, Pakistan.
The issue from my side is, that the same team behind this programme ie. Validus, was behind Au Lives and One Coin, which ended up being a typical Ponzi Scheme.
Is there any way to get clarification around this, and should Muslims should be investing in something like this?
One of Validus’s Website: https://validus-team-official.com/
Details of how the returns work: https://validus-team-official.com/validus-compensation-plan/
What I saw after jumping into one of these webinars and then after looking into it online:
One Coin Scam: https://behindmlm.com/mlm-reviews/aulives-review-sgc-ponzi-points-onecoin-clone/
Au Lives Scam and being absorbed by Validus: https://behindmlm.com/mlm-reviews/validus-review-dubai-crypto-ponzi-gobbles-up-aulives/
Answer:
In the Name of Allah, the Most Gracious, the Most Merciful.
As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.
Answer:
In the Name of Allah, the Most Gracious, the Most Merciful.
As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.
We apologize for the belated response.
Your question refers.
We applaud you for your sincere intention (Niyyah) in ensuring your financial dealings are shariah compliant. May Allah Subhanahu Wa Ta’ala grant you the means to earn a shariah compliant income. Ameen.
There are a number of considerations before considering the shariah compliance of such products including ensuring the concept being Shariah compliant, the terms and conditions are compliant and the products are audited and reviewed for shariah compliance. The fundamental element in any Shariah Compliant structure is in ensuring a legitimate bonafide shariah compliant exchange of services/assets in exchange of legal shariah compliant tender. The contractual terms and conditions of the underlying structure should also be shariah compliant without any Faasid/Baatil (voidable and invalid) clauses and terms. While the concept may reflect a shariah compliant contract, the terms may be Faasid or Baatil rendering the contract impermissible or suspensive. Moreover the validity of a Fatwa depends on the ongoing shariah compliance of the structure based on sharia audits and reviews. A Fatwa could be retracted in the event of a number of jurisprudential factors including change of norm (Taghayyur al-Aadah), change of the locus and time (Taghayurr al-Zaman and al-Makan) and non-compliance with shariah laws based on the academic deductions of the shariah scholars. If a shariah ruling has been issued based on the information at the disposal of the shariah scholars and such information changed or the condition of the investment changed later, then the shariah scholars are compelled to review their position based on sound academic transparency, honesty and adherence to the laws of Shariah and Allah Subhanahu Wa Ta’ala.
In general, most investment products are premised on the basis of Mudarabah/Islamic sweat equity partnership and hence all the rules and laws of Mudarabah will be applicable. Therefore the financial institution serves as the Mudarib/sweat equity partner while you as the depositor serves as the Rabb al-Maal/depositor/investor. Essentially all the capital and profits cannot be guaranteed. The financial institution generally engages in a parallel Mudarabah with clients for financing or the investment in capital market instruments with issuers. An indicative rate which is uncapped is permitted. However a fixed rate of return with guaranteed capital is not permitted as that is merely an interest on a loan. (Kitab al-Mudarabah, Hidayah, Vol.2, Pg. 282)
The treasury function at the back office level should also be shariah compliant and the funds should not be mixed up with conventional funds (Khultah) as that would render the entire solution impermissible. In other words, the funds received by the financial institution should only be invested in shariah compliant instruments strictly speaking.
With regards to your specific query, we understand that the Validus Trading product provides a fixed guaranteed return including specific fixed benefits and rewards according to our understanding. The Validus Trading Product is hence impermissible due to the fixity of returns/rewards without a shariah compliant structure. Moreover the The Validus Trading Product is also an MLM or multi level marketing scheme which should be investigated and researched further. Moreover we advise caution based on the general warnings as is common cause that the Validus Trading Product is an unregulated scheme based in the UAE. We therefore advise the public to abstain from such investment schemes. Now with regards to the Fatwa issued by the scholars, you have followed the due process by seeking a proper verification from the Ulema. Islam teaches us to seek clarification. We have contacted the relevant stakeholders and scholars who have confirmed that such a Fatwa and shariah certification is invalid. In other words, they do not vouch for the shariah compliance of the Validus Trading Product. Moreover, the Public should also understand that the opinion of the shariah scholars are not indefinitely valid and are subjected to ongoing shariah compliance audits, reviews and supervision. Therefore, the further continuous usage of such certification in our understanding is therefore inherently misleading, misguided and fraudulent. A Muslim should subject himself to honesty and truthfulness.
We have also contacted Global Islamic Financial Services who have issued the following public statement in this regard:
“ Official Statement: Shariah Compliance Public Update and Notification:
Validus Trading (https://validus-team.info/) based in Dubai, UAE is not certified as Shariah Compliant by GIFS or Mufti Ismail Desai.
We maintain that any certification by Validus in the name of GIFS and Mufti Ismail Desai is invalid. The shariah certification code XSS/23949/ASP does not match our compliance and audit software verification tool. We do not vouch for the shariah compliance of any firm without valid periodic shariah compliance audits/certification.
Kindly contact us to verify the validity of any shariah certification in the name of GIFS.
Shariah Audit and Compliance Team, Global Islamic Financial Services “
And Allah Ta’āla Knows Best
Shariah Board and Fatwa Committee,
Darul Iftaa, Durban, South Africa
DISCLAIMER: The views and opinions expressed in this answer belong only to the author and do not in any way represent or reflect the views of any organizations to which he may be affiliated with. The opinions and educational information proffered in this communication are based on the jurisprudential understanding and available knowledge of the author. Given that contemporary issues and interpretations of contemporary issues are subjective in nature, another scholar may reach different juristic inferences and conclusions to those as expressed by the author. Whilst every effort has been taken to ensure total academic integrity and honesty, the author is open to corrective measures based on sound academics and juristic inferences. The Shari’ah ruling given herein is based specifically on the specific scenario in question. The author bears no responsibility towards any party that acts or does not act on this answer and is exempted from any and all forms of loss or damage. This answer may not be used as evidence in any court of law without prior written consent from the author. Any or all links provided in our emails, answers and articles are restricted to the specific material being cited. Such referencing should not be taken as an endorsement of other contents of that website.
and Allah Ta'ala Knows Best
Mufti Ismail Desai
Darul Iftaa
Durban, South Africa
Disclaimer The views and opinions expressed in this answer belong only to the author and do not in any way represent or reflect the views of any organizations to which he may be affiliated with. The opinions and educational information proffered in this communication are based on the jurisprudential understanding and available knowledge of the author. Given that contemporary issues and interpretations of contemporary issues are subjective in nature, another scholar may reach different juristic inferences and conclusions to those as expressed by the author. Whilst every effort has been taken to ensure total academic integrity and honesty, the author is open to corrective measures based on sound academics and juristic inferences. The Shari’ah ruling given herein is based specifically on the specific scenario in question. The author bears no responsibility towards any party that acts or does not act on this answer and is exempted from any and all forms of loss or damage. This answer may not be used as evidence in any court of law without prior written consent from the author. Any or all links provided in our emails, answers and articles are restricted to the specific material being cited. Such referencing should not be taken as an endorsement of other contents of that website.
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