Investors taken for a ride in scam

Today front page of The Star, so easy to be cheated or Malaysians lack of investment opportunities? After gold bar investment, fraud foreign currency trading, seaweed plantation, coffee house, Nasi Kandar,earthworm......now kiddy ride machine.

Investors taken for a ride in scam

By JOSEPH LOHsunday@thestar.com.my

PETALING JAYA: Hundreds of investors who were lured into taking part in a kiddy-ride machine scheme have been cheated of their money amounting to millions of ringgit.

The investors, who were lured with the promise of attractive monthly returns, have been duped into paying as much as over RM80,000 each to “invest” in kiddy ride machines that would be placed in several shopping malls around the country.

It is believed that hundreds of people have fallen victim to the scam operated by a Kuala Lumpur-registered company and lost millions in the last few months.

Syndicate members, who approached their victims at shopping malls or contacted them by phone, even went to the extent of applying for credit cards on the victims’ behalf so they could come up with the money for the investment.

One victim who said he had not received any returns, now owes a bank RM35,000 in credit card charges.

Others claimed they received cheques but there was no more payment after a few months. Victims were initially given various excuses but subsequent calls made to the company’s office went unanswered.

The Selangor MCA Complaints Bureau has received 80 complaints so far this year, with losses amounting to almost RM2mil.

Bureau head Datuk Theng Book believes many more people could have been similarly duped.
The majority of victims lost between RM20,000 and RM40,000, with one losing RM84,000.
He said victims of the scam were mostly from the middle-income group.

“The syndicate typically targets the middle-class group, especially those not business-savvy but hoping for better returns on their money,” said Theng, who is also the MCA’s head legal adviser.
Theng said victims had little recourse to recover their money, as current laws as well as the nature of the scam made it difficult.

“They (scammers) find loopholes in the law and exploit them. They are operating just below the law, and there are many uncertainties,” he said, adding that the police and Bank Negara had not been able to stamp out their activities.

“It is an enforcement problem. Either we do not have the expertise to enforce it, or the agencies are looking and waiting for each other to act. In the end, the victims suffer,” he lamented.

He said enforcement agencies should use all the laws available to bring scammers to book.
“It can be classified as deposit-taking because they collect money, promising returns. This falls under Bank Negara as only licensed financial institutions can collect deposits. They can also use the Anti-Money Laundering Act to nab these people.”

Theng said one syndicate had been running scams around the region for years.
“They constantly change the product or the company name. Within six months, they shut down and start a new one. And then they move and sell a new product,” he said.

A Bank Negara spokesperson said victims of the scam could lodge a report with them so that they could investigate and take the appropriate action.

BNMTELELINK can be contacted at 1-300-88-5465 or via e-mail at bnmtelelink@bnm.gov.my.
To check instances of previous fraud cases, visit www.bnm.gov.my/microsites/fraudalert/03_action.htm.