KUALA LUMPUR - Malaysians lured into
investing in illegal interest schemes have been fleeced of at least RM620
million (S$258.8 million) over the past three years.
The Companies Commission of Malaysia (SSM),
concerned over the rise of such scams, published an advertorial in the wake of
recent complaints over a Canadian land-banking scheme to remind investors of
the risks involved.
Commission legal services division director
Mohamed Sufyan Mohd Mokhtar said the number of the illegal schemes rose from
120 in 2009 to 151 in 2010 and 150 last year.
"An interest scheme is a form of
investment in a medium other than shares and debentures (unsecured loans)
involving the pooling of public funds to finance the business activities of a
company," Mohamed Sufyan said.
In return, participants are offered a specific
return on their investment in the form of money, benefits or facilities.
"A common modus operandi involves
convincing people to make a one-off investment in a business endeavour that is
managed entirely by the operator," Mohamed Sufyan said.
Another is to convince investors to build
their own business (often with a buyback guarantee) on the condition that they
purchase their training and equipment from the operator. "The operators
are creative," cautioned Mohamed Sufyan.
A few years ago, agriculture and its products
(like lemon grass, leeches, earthworms, seaweed) were very popular.
Recent products include livestock (swiflets
and arowana fish), plantations (palm oil, jatropha and agarwood), leisure and
property development (holiday homes and hotels), equipment (ice-cream, ICT and
water-vending machines) and gold.
While such interest schemes have existed in
the country since 2006, it only picked up in 2008, he said.
However, not all interest schemes are illegal.
There are provisions that regulate them under the Companies Act 1965.
"Legal schemes are registered with SSM in
accordance with requirements under the Companies Act 1965," said Mohamed
Sufyan.
He said the only way to determine the legality
of an interest scheme was by verifying with SSM the status of the company and
the scheme it operated.
To date, SSM has registered 173 schemes worth
about RM1.29 billion.
A list of registered interest schemes is
available on the SSM website
(http://www.ssm.com.my/en/company/is-registered-scheme-public) and the public
can call 03-2299-5500 to check or verify offers from interest scheme operators.
Lim Wey Wen
The Star/Asia News Network
Business & Investment Opportunities
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