Tips on how to spot investment scams

2007/04/24

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KUANTAN: The Securities Commission has released an alert to educate the public on ways to recognise illegitimate Internet investment schemes.

In a pamphlet available to visitors at the Permodalan Nasional Berhad’s Malaysian Unit Trust Week, the SC outlined the characteristics of an illegitimate investment scheme.

For example, they may offer investors a scheme that guarantees enormous returns without posing any financial risk to them.

They also tend to assure investors that they will receive returns as high as 30 per cent per month.

The company’s contact address may be based in countries where investors would be unable to ascertain its validity and status.
Investors would also find it difficult to find information on the company’s licence or of its existence in the webpages of any authorities.

Some may claim that their activities do not require a licence or that their licence was issued by another country.

Their offers are also available for a short time. They will also come with instructions to wire the money to a foreign bank account.

The SC also warned the public that the web pages may be designed in a professional manner to mislead investors, complete with details such as the latest share prices, market commentaries, market news and links to other financial web pages.

It added that should indiviiduals become involved in recruiting others, they could be found guilty of propagating illegitimate investment schemes.

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