KUCHING, Sept 19 — There was a jump of 25 per cent in the number of complaints and enquiries related to investment scams registered in the country had throughout the period of Covid-19 pandemic.

The cases received were mainly about those promoted via social media, said Securities Commission of Malaysia (SC) general manager Jawahar Ali Ameer Ali.

“My observation is that during the Covid-19 pandemic, a lot of people felt bored at home during the lockdowns or were struggling financially, so they started looking for investment opportunities as they needed more money.

“This created a fertile ground for the scammers.”

He said last year, there were 1,857 complaints and inquiries related to investment scams, versus the 1,482 complaints and enquiries received in 2020.

In this regard, Jawahar Ali said the SC had been conducting a series of nationwide educational talks to inform the people from the urban and rural areas about the recommended anti-scams measures that they could undertake.

He was met by the press at the two-day ‘Bersama InvestSmart@Sarawak 2022’ programme in Vivacity Megamall here yesterday.

Talking further about the scam-prevention measures, Jawahar Ali highlighted ‘the golden rule’ — never deposit money into an individual’s bank account.

He also said Sarawak was not an exception in such cases, in that six per cent of the complaints and enquiries received on investment scams were from Sarawakians.

Jawahar Ali said among the common tactics employed by the scammers was convincing the victims that they would be guaranteed ‘unusually high returns’ on small initial investments, usually involving a sum as low as RM300.

“Let’s say you ‘invested’ RM300 — they (scammers) would promise you a return of RM3,000 in 24 hours. But before you could withdraw that RM3,000, they would direct you to deposit an amount meant as payment for the Inland Revenue Board’s fee, Bank Negara Malaysia charges or administration fees.”

Adding on, Jawahar Ali said Facebook had also been identified as a platform where investment scams would take place, through which the victims would typically be redirected to communicate personally with the scammers after clicking a link.

Telegram was also listed as high-risk platform for investment scam activities, he said.

“In many scams, they impersonate the licensed intermediaries — this is what we call ‘clone firm scams’. This means that the perpetrators clone the credentials of a legitimate, licensed entity to convince the victims that they are registered, when in actual fact, that’s not the case.”

According to Jawahar Ali, an investment firm that is licensed by a foreign jurisdiction is not allowed to solicit funds from Malaysians, unless it is granted a licence by the SC.

“Some of these companies claim to be international investment firms, but this is the myth that we are trying to dispel here.

“It does not matter if they’re licensed by 10 different jurisdictions; most importantly, they must have a licence in Malaysia to operate in Malaysia.”

Jawahar Ali then pointed out that the SC had been entrusted with the mandate to protect investors’ rights and interests, and to prevent scammers from misappropriating the people’s hard-earned money.

“If it’s too good to be true, it probably is. That’s the advice that we can give.

“There are no investment opportunities that can give you that kind of unusually high returns.

“Some of the best-performing funds in the country can only achieve a return of 10 per cent per annum.”

Jawahar Ali said in view of SC being a statutory body tasked with regulating and developing the Malaysian capital market, it strove to be more proactive in educating the public about identifying the ‘red flags’ of investment scams.

“Such information can be found on our official Facebook, Twitter, Instagram and YouTube pages under the name ‘InvestSmart SC’.

“The ‘Investor Alert’ list has also been set up on our website (sc.com.my), which contains the names of entities that are not licensed by the SC to sell investment products in the country.”

Jawahar Ali also said under the commission’s outreach programme, its teams had been interacting with secondary schools students in Sarawak, namely those in SMK Muara Tuang and SMK Lundu, and imparting on them the knowledge and awareness of investment scams.

He also highlighted a larger-scale investor education and exhibition programme, ‘Invest Smart Fest’, to be taking place at Kuala Lumpur Convention Centre this Oct 14 to 16. — Borneo Post Online

https://www.malaymail.com/news/malaysia/2022/09/19/securities-commission-25pc-spike-in-reports-on-investment-scams-recorded-during-pandemic-times/28905