Public Still Falling Prey To Get-rich-quick Scams

By Sakini Mohd Said

KUALA LUMPUR (Bernama) -- Rashdan (not his real name) seemed to have it all - a good job in the private sector that paid him well, as well as a lovely family, house and savings.

Then, he met an old friend who introduced him to an investment scheme that purportedly yielded lucrative returns. Having fallen for that hook, line, and sinker, Rashdan, 39, handed several hundred thousand Ringgit to his friend.

Then, his life turned topsy-turvy. The so-called investment scheme went bust, he lost all his money and whatever property he owned. He was declared a bankrupt and, worse still, his wife and three children left him.

Rashdan can be forgiven for falling for the scam as it was the first time he had invested in a scheme he had very little knowledge of.

On the other hand, Bakar (not his real name) has been scammed previously, yet he would willingly fork out his money if someone told him of an "attractive" investment scheme.

Eventually saddled with debts, the 28-year-old public-sector employee felt suicidal at one point and his parents came to his rescue by using their life savings to pay off some of his creditors.

In October last year, media reports had quoted Bukit Aman Commercial Crime Investigation Department director Datuk Seri Acryl Sani Abdullah Sani as saying that police had uncovered an estimated RM4.4 billion in losses involving 24 investment schemes between July 2013 and September 2016.

He had said that during the same period police had received more than 2,500 reports of fraudulent investment schemes involving some 1.7 million investors.


Rashdan and Bakar are just two of the many victims of get-rich-quick schemes that unit trust consultant Shaari Anuar has come across in the course of his work or on Facebook.

"They are willing to reveal their bad experiences as they don't want others to fall prey to such schemes, " said Shaari.

He said Rashdan had given his friend a lump sum of RM500,000 to be invested in the scheme that promised monthly returns of 10 per cent.

"He used up his ASB (Amanah Saham Bumiputera) and Tabung Haji savings, as well as the money he had been saving to enable his parents to perform the umrah. He also invested his wife's savings and borrowed money from his relatives, " said Shaari.

It was all hunky-dory in the first three months as Rashdan received the promised 10 per cent returns. Then, the payments stopped coming and that was when Rashdan knew he had been taken for a ride.

Shaari said in Bakar's case, he had admitted that it was greed that enticed him to invest in the popular pyramid scheme called Swisscash.

Bakar borrowed RM150,000 from moneylenders to invest in the scheme and it did not take him long to realise that he had been duped. Half his salary went towards his debt repayments.

"Then he received another offer to invest in a fish farming scheme. Again, he fell for it and borrowed RM30,000 from his parents. He got the promised returns during the first two months. When the third month came, the operators had disappeared, " said Shaari.

Undeterred by his previous losses, Bakar tried his luck at investing in a gold scheme which also promised good dividends. That scheme went bust too, leaving Bakar and other investors in the lurch.


There is nothing new about reports of people falling prey to get-rick-quick schemes. The victims often include highly educated people who are supposed to have the knowledge and ability to make sound judgements before parting with their money.

Universiti Putra Malaysia's Resource Management and Consumer Studies Department head, Associate Prof Dr Mohamad Fazli Sabri, said it was essentially greed and the desire to make a fast buck that led people - regardless of their academic qualifications and social standing - to invest in schemes which promise lucrative returns within a short period.

"These operators (of get-rich-quick schemes) are always coming up with new ways to convince people to participate in their schemes, " said Mohamad Fazli, who is also a financial expert.

He said there were several types of get-rich-quick schemes in the market and these include unlicensed deposit-taking schemes, and pyramid and Ponzi schemes. Many schemes involving direct selling, commodity market investment and foreign exchange (forex) transactions also fall within this category.

Often, university and college students, government employees, retirees, villagers and women are targeted as investors.

"Usually, an investor will get good returns in the first few months and, overcome by greed, they will continue to invest more money, " he said.


Get-rich-quick schemes have been around in Malaysia since the 1970s. One of the more notorious ones that shook the nation in the early days was the Pak Man Telo scheme, an illegal investment scheme operated by Othman Hamzah, who reportedly raked in RM90 million from 50,000 investors.

Others well-known get-rich-quick and Ponzi schemes that existed in the 1980s and 1990s were the Labu Peram, Platinum Lane and the 350 Scheme.

Mohamad Fazli said following raids by the police, the "industry" quietened down. However, in 2006, the get-rich-quick phenomenon reared its ugly head once again with the emergence of the Internet.

"Such schemes will flourish as long as there are gullible people around, " he said, adding that the public should learn to tell the difference between get-rich-quick schemes and genuine investment schemes.

He said before investing their hard-earned money in an investment scheme, the public should get more information about the company or operators concerned from Bank Negara Malaysia and the Ministry of Domestic Trade, Cooperatives and Consumerism.

"It may be a complicated process but it's worth the effort as you won't end up losing all your savings if you first find out if the company you are dealing with is a legitimate organisation."