Complaints, enquiries on investment scams surge during pandemic

KUCHING: The number of complaints and enquiries related to investment scams and unlicensed activities in Malaysia surged 25 per cent and 57 per cent, respectively, during the two COVID-19 years, according to the Securities Commission Malaysia (SC).

Its general manager Jawahar Ali Ameer Ali said last year, there were 1,857 complaints and 2,193 enquiries received, whereas in 2020 there were 1,482 complaints and 3,464 enquiries made.

Although there is no definite data or reason behind the increasing numbers, he believes that the financial struggle faced by the people during that period resulted in them getting trapped in scammers’ baits.

"Prior to 2019, we received complaints and enquiries but not as much. So the numbers are quite telling and from my observation, it has got to do with people who were in lockdown, got bored and a lot of them struggling financially.

"So they are looking for opportunities via social media and need more money and this resulted in a fertile ground for these scammers to flourish,” he told reporters at the two-day "Bersama InvestSmart@Sarawak 2022” programme recently.

The then low-interest rate environment and high social media usage also contributed to the rise of such online scams, he added.

Noting that ‘an informed investor is a protected investor’, Jawahar Ali said the series of educational and financial planning workshops on investment held by the SC via the InvestSmart platform will ensure that people are financially literate.

For instance, InvestSmart conducted the Agen Bijak Labur Desa (ABJAD) programme that started this year, specifically meant to improve the rural population's financial and investment knowledge, considering that people from rural areas are identified as vulnerable based on the complaints and enquiries received by the SC.

"Under ABJAD, we target secondary school students to be the agent of change by informing them not to fall into scams so that they will go home and inform their family members and friends.

"Altogether, we have 14 schools involved with two of them in Sarawak. Our target is to have 12,500 participants involving students and teachers by end of this year,” he said.

Jawahar Ali said the SC aims to be more proactive in educating the public about identifying the ‘red flags’ of investment scams via its social platforms such as Twitter, Instagram and Youtube.

He also advised the public to always check on the SC’s Investor Alert List to identify unauthorised and unlicensed entities in Malaysia.

"Some of these companies claim to be international investment firms, but this is the myth that we are trying to dispel here because most importantly, they must have a licence in Malaysia to operate in Malaysia even if the entities are licensed by 10 different jurisdictions,” he said.

In conjunction with financial literacy month this October, a larger-scale investor education and exhibition programme - InvestSmart Fest - will be held at the Kuala Lumpur Convention Centre from Oct 14 until 16. - Bernama

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