KUALA LUMPUR (Oct 15): The popularity of social media platforms has unfortunately created a fertile ground for investment scams. Lockdowns during the Covid-19 pandemic have also contributed to a pickup in such activities.
The number of complaints and enquiries on unlicensed activities and scams the Securities Commission Malaysia (SC) received in 2021 rose 93% to 3,475 from 1,798 in 2020. For the year-to-September, the figure stood at 1,851.
In 2019, the number of complaints and enquiries received was a mere 774.
The SC is responsible for rule-making, enforcing regulations pertaining to the capital market, ensuring sustainable market growth and development, supervising capital market activities and market institutions, and regulating all entities and persons licensed under the Capital Markets and Services Act 2007. As such, it is responsible for investment-related scams that may involve breaches of securities laws administered by the SC.
According to the SC, the complaints and enquiries on unlicensed activities and scams formed approximately 62% of total complaints and 51% of total enquiries received year-to-September 2022.
Unlicensed activities entail persons carrying on the business of regulated activities without a licence or being registered with the SC. Meanwhile, scams include the promotion of fake investment products.
Social media platforms are a popular avenue for scammers. This year, many of the complaints and enquiries the SC received were related to illegal investment schemes promoted through the Telegram messaging platform.
Money games, which refers to get-rich-quick schemes, whereby operators use the money collected from “investors” to trade in foreign currencies, are also gaining in popularity.
The cover story this week also looks at interest schemes that were closed. Why did they fail?
Read more about it in The Edge Malaysia weekly’s Oct 17, 2022 edition.
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