Types Of Money & Investment Scams You Often See In Malaysia

*Updated on 19th Dec 2017

Did you know that Malaysians are the most vulnerable to internet scams according to a survey by Telenor Group? And it’s even worse for our millennials with Malaysian consumers in their 30s and below most susceptible to online fraud  according to findings from the National Consumer Complaints Centre (NCCC). Aside from that, NCCC also said that millennials often become victims to online fraud as they fall prey to best price and limited edition offers. 

Almost every day we’re reading a new headline about another Malaysian victim who has been scammed out of thousands of their money. Here is a list of the most common scams happening in Malaysia that you need to be aware of right now so you don’t become a victim and lose your money!

Types Of Money Scams In Malaysia

Illegal Money Lenders Claimed To Be 'Licensed'

Early December this year, Bank Negara Malaysia (BNM) has cautioned the public on persons or companies conducting illegal money lending activities using fake licences purportedly issued by it.

In a statement, BNM said the fraudsters aimed to deceive the public by posing as licensed money lenders and lure them into making initial payments for various purposes related to loans, such as administrative expenses, stamp duty and legal fees.

If you are looking for a personal loan or financing alternatives, you need to know that you are not required to pay any 'deposit' or 'down payment' in order to get the loan approved. For example, CompareHero.my offers free comparison and application service for both personal loans and credit cards.

So next time an agent or agency asks for you to transfer money to an individual or company account, walk away because it is very likely they will disappear after successfully tricked you for your money.

The EPF Scam Syndicate

Be wary if you are approached by an individual or corporation claiming to offer you access to quick cash by helping you to make early withdrawals from your EPF fund. These EPF scam syndicates will then charge you a fee ranging from 30% to 60% in commission from the withdrawn amount. The syndicate uses social media accounts, and even uses the EPF logo in order to dupe victims and those desperate for cash. EPF has warned its contributors that these scammers are sending false messages through social media, short messaging service (SMS) and WhatsApp.

Aside from the early withdrawal scam, EPF has also identified false SMS messages sent to EPF contributors, claiming their EPF account will be blocked unless they contact the number provided. Don’t respond to such messages. Official messages from  EPF will display a five-digit short code as sender identification (ID), and the messages will not be sent to members from a personal mobile number.

Remember that as an EPF contributor, you can get into legal trouble if you engage with the scammers to make early EPF withdrawals. Offenders can be charged under Section 69 of the EPF Act 1991 for making unlawful withdrawals. Under the act, those who are found guilty of fraudulent withdrawals can be sentenced to three years jail or RM10,000 fine, or both.

The Travel Package Scam

Be wary if you come across cheap travel packages, especially on social media platforms. These type of scams have been on the rise lately, and the tactics these scammers use are:

• To advertise on social media sites, usually Facebook or Instagram
• Usually, advertise packages (but not limited to) to Pulau Redang and Pulau Perhentian
• Below the market price range of RM200-RM250 for a 3 nights package
• The “agent” cannot be contacted after money have been deposited into the account

Scams for Umrah and Hajj packages are also on the rise these days. The biggest red flag it is a scam is the price. As a general rule of thumb, any Umrah package that is lower than RM5,000 is a warning bell. This is because legit packages usually stretch for 12 to 14 days, and it is not logical for any agent to be able to offer packages priced lower than RM5,000 for this duration and still be profitable. As for Hajj packages, it is advisable to go through Tabung Haji to avoid the potential of being scammed.

If you are looking for travel deals, you are better off scoring legitimate travel deals at travel fairs such as the MATTA travel fair which happens twice a year. The travel agents have been screened by MATTA (Malaysian Association of Tour and Travel Agents) so you won’t have to worry about being duped out of your hard earned money.

Tip: Check with the Ministry of Tourism and Culture Malaysia or Malaysian Association of Tour and Travel Agents (MATTA) to verify if the travel agent you are engaging is licensed.

The Travel Visa Scam

The Australian visa scam is the most widespread Visa scam currently happening in Malaysia. Scammers trick Malaysians into thinking they can save time and money by soliciting their services to get the travel visa for them. Instead, they will find that they have lost their money, and are stranded without a travel visa.

Deal with official or reputable channels to ensure you don’t become a victim of visa fraud or scams. Go directly to the country’s embassy or deal with a licensed and reputable travel agency to get the travel visa. As for Australian Visa, VFS Global operates the Australian Visa Application Centre in Malaysia.

Malaysians should also be wary of facilitators in Malaysia who provide visas and flights to Australia for people who intend to work, usually in fruit picking jobs. It’s a crime and a scam as the visa does not actually allow you to undertake any work in Australia. If you do work in Australia with your travel visa, it is considered a breach of your visa conditions and you could be detained and removed, and subject to the 3 year exclusion period.

If you are aware of, or suspect, a scam in relation to Australian visas, please inform the Australian High Commission in Kuala Lumpur by sending an email to visakl@dfat.gov.au.

More information on official and proper channels to obtain your Australian travel visa is available on the website.

The Land Scam

Before purchasing  land, make sure you have done your homework. Land scams are on the rise in Malaysia with cases of forged land titles. Victims will only realise this after taking the land title to the land registry office and find that the land title is under another person’s name despite having paid for the purchase of the land.

To protect yourself, make sure everything is dealt with in black and white, and appoint a lawyer to protect yourself. This is especially if you are not familiar with the procedure involved in purchasing land or property.

DO NOT put down your signature on any agreement or document before reading it thoroughly or have a lawyer explain it to you.

Aside from that, don’t pay for any deposit before making the necessary checks and having it in black and white. Even if the individual or agent tries to create urgency by saying you will lose your chances of owning the land, insist on going through the proper process.

The Lottery Scam

If you think Malaysians do not fall for these scams anymore, a man recently lost RM120,000 after he was tricked with a lottery scam. Aside from scratch and win scams, which many may already be familiar with, scammers have a new modus operandi now.

The scammers will say you have won a lottery, or ask for help to get access to their lottery loot. They usually work in groups and will always require you to give them a sum of money before you can claim your prize or your share of the winning. As for the recent case linked above, the man was asked to help retrieve lottery winning and promised a share of the money. But he was asked for a sum of money first to make sure he won’t run away with the money. After handing over the money, the fraudsters disappeared leaving him thousands of ringgit poorer!

Tip: If you really won something, you should not have to deposit or hand over any amount of money or payment to retrieve it. If you are told to do so, just walk away.

The African Scam

In the first half of 2016, it was reported that Malaysians have lost RM44 million to African scammers. Just last week, police rounded up 44 African scam members, which means the scam is still actively running in Malaysia. Although there have been many reports of African scams gracing news headlines, Malaysians are still falling victims to it, with 90% of African scam victims being women.

Here are signs to watch out for so you don’t become a victim to it:

• Men who befriend female victims through social media and then woo them into a “relationship”. They use fake photos of good looking men who are usually Caucasian.
• They will avoid meeting you in person, or video communication. Communication will usually be restricted to calls, e-mails or instant messages only.
• Scammers will tell victims they have sent cash or expensive gifts but it is stuck with the Customs Department, Immigration or a bank.
• An individual claiming to be an authority will contact victims and ask for money to be banked into their personal bank account before the cash or gifts can be released to them.
• The “authority” will usually ask the victims for several collateral payments into their personal account. The victims will then find that the “authority” person can no longer be contacted and they never receive the items or cash. Their “friend” will also be no longer contactable.

These type of scams are still happening because Malaysians are aiding them. The Nigerian men behind these scams enter Malaysia as students in local private colleges. Local women are then usually used because they will provide access as Malaysian bank account-holders who will also pretend to be authorities to scam victims.

The Bank Impersonator Scam

If you receive a phone call claiming to be a bank officer who needs to verify your credit or debit card, hang up straight away.

The callers will identify themselves as a Bank employee or even Bank Negara Malaysia (BNM) representatives. The scammer will then tell potential victims that their identification has been compromised or their card has been used. To verify their identification, victims may be required to deposit a sum of cash into an account as a guarantee for an investigation. If not, the potential victim will be asked for sensitive information such as their card number, full name, I/C number and the Card Verification Value (CVV) number. What happens next is the victim's account will be emptied out, or their card will be used.

The latest bank impersonator scam in Malaysia is are individuals posing as Maybank bank officials. The scammers claiming to be Maybank officers asking potential victims to provide their full name and identification card numbers for verification. When the person they are trying to scam say that they do not have any loans with Maybank, they will tell the person that their identity have been used fraudulently.

The scammer will then provide a number to call. A fake officer would then ask for information relating to the victim's banking and credit card accounts.The fraudster would then instruct the victim to transfer money to a third-party account on the pretext of safeguarding the victim's money as well as for investigation purposes.

The Investment Scam

Getting a hefty return for your money, especially in a short amount of time can be tempting, but don’t be so quick to fall for it. Scammers use these tactics to take advantage of gullible and greedy Malaysians who wants to make a quick buck minus the hard work.

The most rampant investment scams in Malaysia are:

The Job Offer Scam

If you’ve been approached by an individual offering you a high-paying job, especially if it is through social media, be wary. A new job offer scam is on the rise, and the modus operandi is by using social media to scam Malaysians into working for a Macau Scam.

Firstly, the victims will be promised jobs with salaries between RM5,000 – RM7,000 a month via WeChat. The victims will then be told to meet the prospective employer at coffee shops. These Malaysians will then be trained, and then sent abroad to carry out telephone scams.

“Nobody conducts job interviews for such high-paying jobs in coffee shops,” - Federal Commercial Crimes Investigations Department deputy director Senior Asst Comm Mohd Sakri Arifin

He also shared that the recruits were trained to impersonate police, Bank Negara and Customs Department officers. The fraudsters will use Voice over Internet Protocol technology to replicate the phone numbers of the Malaysian enforcement agencies.

The recruits then call potential victims claiming they have been implicated in criminal activities overseas, are wanted for buying drugs online or for money laundering. The victims will then be asked to make payments or transfer money into other accounts to prevent it from being frozen.

If you receive calls claiming to be from officials, get the individuals name and don’t give out any of your personal information. You should then call the respective departments by such as police, Customs Department or Bank Negara by manually dialling the number yourself. Do not ask to be connected to a department, or accept if the “officer” offers to give you a number to call.

The Work-From-Home Scam

Work from home scams are among the top three scams Malaysians fall victims too. Although there are various legitimate online websites for job classifieds such as Jobsteet.com, be careful with other job postings online. A red flag for work from home job scams are usually when you are asked to make a payment first, claiming only after the payment is received will they give more information on the job. These types of work scams will also be coy and not advertise the upfront payment needed. Once you contact them for more information about the work, they’ll demand for payment.

Also, look out for too good to be true phrases on the job ad, such as:

• “work from anywhere!!!”
• “Flexible hours!!!”
• “set your own schedule!!!”
• “earn RM500 – RM1,000 WEEKLY!!!”

Protect yourself by reading our article, Don’t Become a Victim of Work-from-Home Scams.

Other scams Malaysians should be wary of are:

• Unregistered companies
• Unlicensed people; e.g. an individual providing insurance schemes who is not registered
• Encouragement of borrowing money to invest more
• Lack of transparency on an investment opportunity
• Fake social media profiles that contact you relentlessly / text message or phone calls pestering you to sign up
• A founder or successful member displaying wealth to encourage sign-up into programmes or investment

Additionally, Malaysians can now go to a verified portal set up by the police to check for fraudulent accounts and to see if the bank account has been involved in fraud cases. It’s currently on a test run but the portal is already up and running here.

Remember, be wary when it comes to your money and also your personal information. Don’t fall for anything that sounds too good to be true as fraudsters usually, try to tap into victims who are greedy or gullible. If you want to invest, do know that if it promises high and fast returns, it’s highly likely a scam.

See also: Online Scams in Malaysia You Need To Know About

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