BE wary of dubious companies using clone firms to scam investors of their funds, cautioned Securities Commission Malaysia (SC).
In a statement today, the regulatory body noted there is a sharp increase of clone firm scams due to the COVID-19 pandemic.
“The scams are perpetuated by companies which fraudulently impersonate a legitimate entity, including misusing the name and logo of a public listed company (PLC) to dupe investors and to solicit funds.
“These clone firms offer non-existent investment opportunities, including the shares of these PLCs, promising unrealistically high returns within a short span of time.
“In May, the SC had also issued an alert against fraudulent clone firms posing as licensed capital market intermediaries,” said the SC.
Among the so-called offers made by the scammers are investments in the medical, glove and property sectors.
SC added that many who had their company information used by these scammers have lodged reports with the police and the regulatory body.
“Other than the names and logos of these PLCs, the fraudsters also use corporate credentials, websites and other details of legitimate entities when promoting these schemes via social media channels such as Facebook, WhatsApp and Twitter,” it stated.
The scammers’ modus operandi was to convince potential investors into divulging their personal information such as names, MyKad numbers and bank details.
From there, the fraudsters will direct the potential investors to transfer funds to the former’s personal bank accounts.
“Following this, they will induce the victims to part with more money on the pretext of income tax payments, administrative fees, bank charges, withdrawal fees or exchange rates,” it said.
As such, the SC urged investors to exercise caution when evaluating investment opportunities, especially those that promise very high returns with very little risk.
“Seek counsel from licensed and legitimate advisers. Please verify bank account details at the “Semak Mule” online application and website made available by the Royal Malaysia Police’s Commercial Crime Investigation Department to check if a bank account and phone number is used for fraudulent activities or its owner has any criminal records,” it added. – Nov 5, 2020
