Malaysia, the money game country

At 9.02 am(0102gmt), the local note was traded at 4.3960/4010 against the greenback from 4.4100/4150 at 6pm on Thursday.

How serious is the money-spinning industry in Malaysia? On my way back from Beijing last year, I met a group of young Chinese flying here to take part in a pyramid activity initiated by Malaysians.  

The money game industry has ventured out of the country in a big way!

On the flight, two Chinese nationals sitting beside me explained how to rake in fast returns through the get-rich-quick scheme.  

"You Malaysians have missed this bounty. And we are now bringing some of our compatriots to Malaysia to grab a share of the wealth."  

These Chinese participants will visit the company's headquarters in Malaysia, attending talks and doing some sightseeing as well.  

I believe more Chinese will flock here while the Malaysian authorities are largely kept in the dark.  

Many Chinese nationals will suffer if these get-rich-quick schemes eventually collapse, and this could likely develop into a diplomatic storm between Malaysia and Beijing.  

Of course, the Chinese are not the only people crazy about pyramid activities. Tens of thousands of Malaysians are rushing into it as well.  

In 2012, we saw a gold investment scam that rocked the nation, that later saw Bank Negara working with the PDRM, Companies Commission of Malaysia and the Domestic Trade, Cooperatives and Consumerism Ministry to raid four companies.  

Some 100kg of gold bars worth around RM20mil were seized.  

Some 35,000 investors fell victim to the scam that involve an investment sum in excess of RM10bil.  

Later, six directors and business consultants of Genneva Malaysia Sdn Bhd were charged with money laundering and illegal fund collecting activities.  

They faced a total of 929 charges involving a sum of RM5.5bil 

But in 2013, three directors and a former director of the company were freed from 224 counts of money-laundering and five charges of accepting deposits of more than RM141mil without a licence.
And in September last year, the High Court upheld their acquittal.
The company had carried out the buy-and-sell activities physically and there was no evidence that the firm took deposits without a licence, the Judicial Commissioner found.

He said Genneva had given choices to buyers to sell the gold back to the firm, keep it or re-sell the gold to other parties other than the company.

Bank Negara and other enforcement units took the action to prevent more people from falling prey to illegal trading activities.  

Unfortunately the momentum has not been sustained.  

Take YSLM for instance, despite the fact that the company had caused quite a stir in this country, its founder, the "world's future richest man" Zhang Jian was arrested in Thailand, not Malaysia.  

And now, Zhang is about to launch a virtual currency to stage a major comeback in this country.  

More than 1,000 people claiming to be members of the Zhang Jian Pearl Club attended a gala dinner in honour of the "King's return" in Johor Baru last Sunday.  

What makes it so difficult to weed out illegal trading activities?

Other than the Anti-Money Laundering Act, perhaps the Government can look at the Financial Services Act 2013 and the Direct Sales and Anti-Pyramid Scheme Act 1993 when dealing with these illegal syndicates.  

The Government could even consider legislating new laws if the existing ones are insufficient to handle them.  

Thanks to lax enforcement, the money game has sprung up like mushrooms in recent years.  

Bank Negara's list of "unauthorised and unapproved" companies has jumped from 271 last year to 288 today, many of which involved in illegal forex transactions and gold investment.  

And since we already have their details, why just keep them in the blacklist and take no actions against them? Greed is a universal human nature.  

We can't expect everyone to have the ability to think logically and make sound judgments.  

When the first batch of people have indeed bagged in handsome profits from the money game, more will follow suit.  

And no one will believe they will be so unlucky to lose all their money to unscrupulous dealers. But, you can't be lucky forever. The deeper you sink into it, the more you will lose.  

Those who have made some quick bucks from the scheme will naturally become staunch defenders of the company's founder, as they lash out at well-intentioned reminders and media reports.  

And since it is so easy to become millionaires, sharp-witted young people tend to draw up a melange of new investment schemes to entice their unsuspecting victims, such as a 25-year-old self proclaimed "Datuk" at the centre of a forex investment scheme in Penang.  

In the meantime, the JJPTR scheme is said to have about 300,000 members, many of whom are professionals supposedly having above-average analytical abilities.  

Who would want to work hard if they can make money in get-rich-quick schemes? How are we going to transform the country's economy with so many people engrossed in illegal money game activities?   

Once the scam bursts, the country's economy will suffer a further blow.  

The money game, therefore, is not something we should conveniently ignore. When your neighbours, friends and relatives begin to join in, our society will no longer be the same any more.  

The fact that such illegal activities have been able to go on unchecked shows that the Government has been lax in enforcing the laws. If we allow such anomalies to go on, a much bigger storm will be in the making, sooner or later.

> Lim Sue Goan writes for Sin Chew DailyThe views expressed here are entirely the writer’s own.


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