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Showing posts with label Scams. Show all posts
Showing posts with label Scams. Show all posts

Monday, November 11, 2024

A web of scum and villainy, Scam complaints in Malaysia up 300% since 2019

PETALING JAYA: They were professionals in the field of finance, banking, accounting, education and information technology, and were well aware that cyberspace was rife with scams.

However, this did not shield even them from being scammed by a syndicate with members posing as seasoned stockbrokers supposedly from well-known investment firms based overseas.

A frugal and astute investor, finance manager Ken Wong – who lost over RM450,000 – had made wise financial choices throughout his working life, building a secure nest egg for his future and family.

With a background in accounting and being savvy in financial matters, the 41-year-old employee of a logistics company never expected to find himself ensnared by a deceptive investment scheme.

Although he was aware of scams in cyberspace, all it took was six weeks of cunning, convincing and crafty assurances by scammers before Wong was ripped out of his hard-earned savings.

“I am very thrifty and careful with my expenditure, saving as much as I can for my family, and this is really devastating.

“What if this happens to someone in their old age? It would engulf that person with hopelessness. This is why I would label these scammers as nothing less than ‘murderers’ as they can kill a person by snatching away their sanity and future,” he said.

Still reeling from his loss, Wong said it all started in May when he spotted an advertisement on Facebook that offered insights and short courses on foreign stock investments.

Out of curiosity, he clicked on a link and was promptly greeted by a person who introduced him to the courses, which were being offered for a fee of RM364.

He was then added to a WhatsApp group where lessons were conducted by several foreigners.

Wong said at first, the group only discussed matters related to the course and shared tips on stock investments.

(Click To Enlarge)(Click To Enlarge)

However, weeks later, the scammers, claiming to be foreign institutional investors (FIIs), started introducing and encouraging investments in foreign initial public offering (IPO) stocks, assuring him he could double his money.

Wong said he downloaded the company’s application and what started with a RM10,000 investment led to him pumping in more funds until he realised he was being deceived by bad actors.

He later learnt that the scammers had cloned real-time foreign stock exchange webpages and created features that convinced their victims to believe they were managing their own funds.

“They were so convincing and persuasive, encouraging us to manage our own investments.

“Having downloaded their app and transferring my funds to local business bank accounts were other factors that had me into believing it was a legitimate business,” he said.

“On record, my investment had doubled, but I could not make any withdrawals. When I questioned them, they demanded I invest another RM1.7mil if I wanted to make withdrawals. This is when I realised I had been fleeced.”

Wong said he was in touch with nine other victims including other professionals in the field of investment and finance, and they formed a group to seek avenues to recover their lost funds.

Another victim, who wanted to be known only as Queenie, said she decided to join the scheme after seeing it on Instagram.

“I felt confident because the scammers had fraudulently used the photos of a well-known investment influencer to promote their scheme. They claimed we could receive returns of over 400%.

“Now that I have lost my life savings, there are feelings like anger, sadness and denial.

“I think I am going through depression,” said the 46-year-old banker, who lost over RM230,000, part of which she had borrowed from a friend.

A 41-year-old private university lecturer said he lost RM120,000 of his savings and from his parents’ retirement fund.

He said he was invited to join a WhatsApp group by a woman who claimed to be a Singaporean.

“She told me that she was invited by the government to educate Malaysians on stock investments and encouraged me to join her classes. No payments were demanded in the beginning, but we were then lured into investing after weeks of receiving tutorials on stocks,” he said.

Siva, a 32-year-old office administrator, said he lost RM200,000 that he had partly borrowed from his family.

“I had saved the funds to buy a house as I am getting married soon. I do not know how to break this news to my family,” he said.

All four victims have lodged police reports.

The syndicate, operating under the guise of being stockbrokers, was busted by commercial crime police in September when 17 suspects aged between 23 and 52 were held.

Police said the syndicate had raked in over RM33mil from victims and at least six more suspects are being hunted, with 66 police reports lodged since January.


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PETALING JAYA: Complaints and enquiries on scams and unlicensed activities shot up by over 300% between 2019 and 2023, according to the Securities Commission (SC).

The commission’s Investors Alert List sighted by The Star also revealed that some 15 sites were flagged by the SC for operating as potential clone entities so far this year.

Clone entities are outfits that misuse the name and credentials of legitimate financial and investment bodies.

In the SC’s 2023 annual report, it was revealed that the regulator received 3,262 complaints and enquiries on scams and unlicensed activities – a 321% increase within those four years.

The SC said social media platforms such as Facebook and messaging apps like Telegram continue to be the primary mode for perpetrators to carry out their illegal activities.

“A new modus operandi observed in 2023 was the use of e-wallets and cryptocurrency as the mode of payment involving investment scams, compared with the mule bank accounts that were used previously.

“This may be designed to avoid easy detection and prompt interventions by enforcement agencies,” it added.

In addition to taking action based on complaints and enquiries, the SC has also dedicated a unit to proactively monitor and detect unlicensed activities and online scams targeting Malaysians.

As of Dec 31, 2023, a total of 569 URLs offering unlicensed activities to Malaysians were detected online.

This was a 49% jump from the 382 URLs detected in 2022.

“Of these, 51% were from Telegram, 27% from Facebook, 9% from Instagram and 13% from other sources such as websites, YouTube, and TikTok,” the SC said in its report.

The issuance of cease-and-desist notices, social media interventions, inclusion in the SC’s Investor Alert List, and the blocking of websites with assistance from the Malaysian Communication and Multimedia Commission (MCMC) were among the actions taken against such sites.


Other actions were requests to block Telegram, Facebook and Instagram accounts; referrals to other agencies or foreign regulators; and lodging police reports.

“The SC has and will continue to proactively disrupt the activities of scammers and operators of unlicensed activities,” it said.

In this regard, the SC includes the names of entities and individuals found to be carrying on scams or unlicensed activities on its Investor Alert List as soon as possible – in most cases within 48 hours of receiving a complaint, it added.

The regulator noted that while some unlicensed activities are carried out locally by Malaysians with a local presence, there are also foreign entities carrying out unlicensed activities in Malaysia.

To create greater awareness, the SC said it has released a “more robust, dynamic and mobile-friendly” Investor Alert List called the Investment Checker, which serves as a one-stop centre for the public to check and verify the legitimacy of entities and individuals.

It has also set up a Scam Meter page and does radio and television interviews on scams and unlicensed activities.

Recently, the Finance Ministry told Parliament that the SC had blocked nearly 200 social media sites and over 100 websites linked to illegal investment schemes, placing 184 entities on a watchlist and filing charges against some.

Offshore platforms were blocked with help from MCMC, while the SC advises public awareness on fraudulent tactics.



Wednesday, October 16, 2024

Putting pressure on banks

 


Kill switch' not a cure-all | The Star

KUALA LUMPUR: The issue of whether banks should bear greater responsibility for clients losing money to online scammers is one for Parliament to decide, says Datuk Seri Azalina Othman Said.

The Minister in the Prime Minister’s Department (Law and Institutional Reform) said this may be necessary in light of the issue often raised by the public amid the nation’s move towards digitalisation.

“It is the MPs that should discuss if a more robust insurance scheme is needed for banks and financial institutions that hold our money.

“This is also because we now have a Digital Ministry as the nation heads towards digitalisation,” she said in reply to a supplementary question by Kota Melaka MP Khoo Poay Tiong in the Dewan Rakyat yesterday.

She added that the consumer himself should be careful and alert of scams.

Khoo asked if the banks should be made to bear responsibility for data breaches which result in their customers losing money to scammers.

He cited a recent complaint where a man claimed he had received a notification from a bank at 4.30am informing him of a change in the model of mobile phone used for his online transactions.

“The notification said that there would be a 12-hour cooling-off period before any transactions can proceed.

“However, in less than 12 hours, he found that his money had been transferred out of his account at about 8.30am,” said Khoo.

To this, Azalina said that she too almost fell victim to an online scam after receiving a notification at 3am.

“I was shocked that RM3,000 was transferred out of my account. Fortunately, I managed to get my money back,” she said.

Azalina advised the public to activate the “kill switch” linked to their bank accounts.

If you get a notification at 4.30am, hit the kill switch on your banking app as soon as possible,” she said.

'Kill switch' can prevent scam victims from suffering hefty ...


The kill switch is an initiative of Bank Negara which was adopted by banks on March 1 last year.

On the law against online crimes, Azalina said it could be tabled and passed during the current meeting.

She called on MPs to debate the issue when that proposed law against online crimes is tabled.

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Red flag in credit card fraud

Friday, October 11, 2024

Red flag in credit card fraud

 


With huge profits, it is time for banks and telcos to invest more in improving their infrastructure against rising criminal activities.

IT came as a huge shock to my colleague when she was saddled with a RM38,000 credit card bill – five transactions that took place in Brazil within minutes of each other, a country she had never visited in her life.

The purported expense came when she was travelling overseas. She only discovered her credit card was missing three months after the incident when the bank asked if she had her card with her.

“I was with another colleague in Hong Kong at the time. He received the same SMS alert from his bank. We both called our banks at the same time. But the difference was his bank stopped the transaction because they could not verify it,” she said.

Despite showing proof that she was in Hong Kong at the time of the transaction, her bank could not provide her with the details of the case as they did not ask the merchant for it. The minute they found out the transactions were physical, they washed off their hands and sent her a letter which indicated she was liable for the RM38,000.

“They even tried to charge a currency conversion fee, late fee and interest on the disputed transactions. Finally, after days of frustrating exchanges with the bank, I reported the case to Bank Negara, and only now the bank is reaching out to the merchant to investigate,” my colleague told me.

Sadly, her quandary is not something new. Credit card fraud is on the rise in Malaysia. But financial institutions in general argue that if a card is lost or stolen, it is still the responsibility of the cardholder if any transactions take place. But shouldn’t the onus be on the bank to at least perform due diligence on red flag transactions?

A year ago, banks under the ambit of the Association of Banks in Malaysia (ABM) and Associa-tion of Islamic Banking and Financial Institutions Malaysia (AIBIM) launched their refreshed #JanganKenaScam awareness campaign.

At that time, the associations claimed that the campaign underscored the banking industry’s commitment to combating financial scams and preventing fraudulent banking activities.

They have since implemented several security measures to fight scams, such as migrating from the SMS One-Time-Password (OTP), tightening their fraud detection rules, imposing a cooling-off period for first-time online banking registrations, restricting secure authentications to a single device, and setting up dedicated fraud hotlines for customers.

According to the two associations, these measures have successfully prevented fraudulent transactions worth RM351mil.

But combating fraudsters is a constant battle, with the banks themselves admitting that there is an upward trend and huge losses due to credit card fraud.

Over the years, The Star has published numerous articles highlighting scams and scammers and credit card fraud.

In fact, exactly 10 years ago, we published a front-page article on fraudulent credit and debit card transactions.

We wrote: “Many consumers are questioning the assurance banks give on Internet security after discovering that their credit and debit cards have been used in unauthorised online transactions.”

Ten years later, nothing seems to have changed. If anything, things have got worse.

A study by Ipsos last December revealed that an overwhelming majority of Malaysians have encountered scams, with a distressing number reporting substantial financial harm. The study indicated that scams are exploiting the digital realm, signalling a shift in criminal tactics that jeopardises our collective economic health.

Despite the additional security measures, the current national scam awareness campaign throws the entire burden of fighting scams on poor defenceless Malaysians, many of whom are retired, in their senior age, and somewhat gullible.

This is in stark contrast to what our neighbour down south has done – Singapore is holding the telcos and banks responsible for customers who have fallen prey to scams.

The Monetary Authority of Singapore (MAS) says financial institutions and telcos will have to compensate their customers who have been cheated if they are found to have breached their responsibilities.

These responsibilities include failure by banks to send outgoing transaction alerts to consumers and telcos failing to implement a scam filter for SMSes.

The Singapore authorities acknowledged that “responsibility for preventing scams should not lie solely with consumers but also with industry stakeholders”, such as the financial institutions and telcos.

The shared responsibility should also apply here because banks and telcos, as the primary gatekeepers, must do more to protect Malaysians.

Financial institutions play a critical role as a gatekeeper against the outflow of monies due to scams, while telcos play a supporting role as infrastructure providers for SMSes.

They must incorporate more circuit breakers and track the enormity of the scams that are taking place. Tracking is not good enough; they must also act on it.

With Budget 2025 to be tabled next week, I hope our reform-minded Finance Minister introduces stronger and better measures to help Malaysians and demand more from banks and telcos.

Banks and telcos have amazing balance sheets with huge profits. It is time that they invest more to improve the infrastructure against scamming and fraud.

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DIGITAL WAVE of deception


Financial literacy and bankruptcy

Thursday, October 10, 2024

Fake property agents scamming renters

Calling for action: Chong (seated, second from left) with Lee (Chong’s left) with the six property agents during the press conference. — LOW LAY PHON/The Star


KUALA LUMPUR: Scammers have now ventured into new territory, posing as property agents to dupe unsuspecting renters in the Klang Valley out of thousands of ringgit, with 10 cases reported so far.

Apart from using the profile pictures of legitimate agents and copying their verification numbers on property sites, the scammers even conduct viewing sessions for clients and later collect rental deposits before going missing when the key handover is due.

Victor Lee, a spokesman representing six property agents whose profiles were duplicated by scammers to create identical accounts on a property site to dupe the public, said they only came to know of this after being alerted by their company.

“However, we were not aware of these transactions taking place using our names. Only after it happened did we realise that there were impostors,” Lee told a press conference held by MCA Public Services and Complaints Department head Datuk Seri Michael Chong here yesterday.

He said checks on the property site would find two accounts of the same agent, with one being fake.

“The contact number on the impostor account also redirects to a private number (which is not ours). Listed property prices in the impostors’ accounts are also lower than market rates to attract clients,” he said.

On viewing sessions conducted by the “agents”, Lee said he suspected the impostors rented the property through online rental sites, thus giving them access.

The scammers, he said, would then collect a three-and-a-half month rental deposit upfront, when the norm is that only one month’s advance rental is collected if the client agrees to the unit.

“The balance is usually paid when the unit is handed over to the tenant,” he said.

He said the deposits were also banked into an account number provided by the “agent” and once the transaction was made, the scammer would immediately block the mobile number of the client.

Meanwhile, Chong said losses from the scam amounted to about RM6,000 per case with approximately 10 cases reported so far.

Most of the scam victims are local and foreign students, he said.

“We want to warn the public about this type of scam and ask them to beware of the mobile numbers used in these cases,” he said, adding that he also suspected the scammers could be property agents themselves as they were well versed in rental procedures.

Chong said they would also hold dialogues with real estate associations to alert them on the matter.

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Syndicate using names of real estate agents