T here are several investment firms in the country facing a liquidity crisis. Many of them are also reported to have committed irregularities causing huge financial losses to shareholders.
Most of the companies floated the sale of shares to the public from Mashhad city in Khorasan Razavi Province, but when they sought to expand their businesses to other cities and provinces, their irregularities came to light and they were prohibited, Akhbar-e Bank news agency reported.
Investment companies ‘Padideh Shandiz’ and ‘Pardisban’, financial and credit institute ‘Mizan’ and ‘Grand’ are among the violators, and it is only recently that their publicity efforts were banned on state television and radio.
An important thing to be noted is that earlier the companies had spent vast sums of money on radio and television advertising.
When an advertisement is broadcast by the Islamic Republic of Iran Broadcasting, it creates confidence in the public that the advertiser has been endorsed and approved by the state broadcaster, the IRIB.
Although an advertisement in IRIB doesn’t necessarily put the onus on the organization as it can issue a disclaimer, however, as mass media, radio and television play an influential role in shaping public opinion.
Most of the shareholders are ordinary people not familiar with the complex rules of financial or credit institutions; nor are they able to read between the lines. They take it for granted that TV and Radio are their underwriters. Thus they trusted the firms that advertised on the state broadcasting media; but now they are in a soup.
Unfortunately, when trouble arises, officials start blaming the layman by declaring that they should not have invested without verifying the antecedents of the companies; but who will ever imagine that large companies with their massive advertisements campaigns in the national media would actually cheat the people?
Unapproved
According to Qobad Afshar, head of Land Affairs Organization, IRIB should be blamed for the problem. For instance, he says: “Why should IRIB display advertisements of a company that we earlier announced doesn’t have permit for construction?”
In 2009, Mohammad Reza Qasemi, director general of ‘Padideh Shandiz’ announced the implementation of a huge project, ‘Padideh Shandiz Tourist and Recreational Complex’ in the centre of Shandiz town, approximately 35 km northwest of Mashhad, in the national media.
While a month earlier, the director of Urban Planning and Architecture Organization of Khorasan Razavi had categorically stated that the project had still not been approved by the working group of the provincial Housing and Urban Development Department.
Despite lack of approval by the working group, IRIB kept flashing advertisements of the project, and the company’s shares were sold to the public by ‘Keshavarzi’ Bank and ‘Ansar’ and ‘Mehr’ financial and credit institutes.
Finally in 2013, the deputy head of Mashhad Crime Prevention Department wrote letters to the head of IRIB, the ministers of culture and Islamic guidance, youth affairs, and roads and urban development and the Mashhad mayor directing them to prevent the company from continuing its activities and to ban its advertising.
But again, no immediate measures were taken to stop the company’s illegal activities and publicity campaign in the state media.
Ultimately, one year later, on December 31, 2014, IRIB banned the advertisements of the company, but by then it was too late.
