Most common scams in Malaysia

Many years ago a relative of ours who was working in Dubai was offered a job in Kuala Lumpur at a 5 star hotel. She was concerned it was a scam since they had told her that she needed to pay for the Visa. We contacted the hotel and gave the relative the contact details of the HR Manager who confirmed that they had never offered such a position.

In Low Yat Plaza, there are tons of camera shops. I bought a new 5D Mk II about 15 years ago and found that there was always dust on the sensor which created dark spots on my images. I later checked and found that the shutter count was over 50,000 which means that the camera was not actually new, but was probably a used one that somebody had traded in. Anyway, I had been to the Canon service centre in Shah Alam a few times to get the sensor cleaned, and finally Canon offered to replace the camera with a brand new one which was brilliant. After that I only ever bought camera gear from legitimate Canon dealers, and in fact chose to buy most of my lenses and other gear in Indonesia at a reputable camera shop.

Another time, I had joined a group of photographers for a modelling photo shoot, this time it was supposed to a sexy model in lingerie. The fee for lingerie photography is higher than with normal modelling shoots. After about 10 minutes into the shoot, the guy organising the shoot told us that the girl no longer wanted to strip down to her underwear. I guess it isn't a scam as such, but I was peeved that I'd paid for lingerie and only got a girl posing fully clothed. We did not get a partial refund either.

Can't think of any other scams during my years living in Malaysia.

@Cheryl

Moved to Malaysia in 2011.  I was pretty comfortable investing and trading on my own but the time difference between UK/US markets made it difficult as I had to spend many nights up, which interfered with family life and work hours.  I decided to invest with the a Group.  I am sharing my own experience, which may not be representative.  After being invested with them (lump sum + monthly deposits) for 7 years, they reported that I had made over 62% on my portfolio but looking at it closely showed that my contributions had made my portfolio grow by 60% and the gain was only 2%.  Upon requesting an explanation and a schedule of fees, I realised that ALL the profit had been extracted through fees and charges amounting to more than $100K.

There are many firms like this operating in KL that will promise strong gains but extremely few deliver.  Brokers get large fees, firms get fees for reselling existing products, both getting 2.5% or more on top of the original management fees of the actual fund so right off the bat, you lose 6-8% in fees EVERY YEAR.  How can you make a profit???  You need to be very wary of slick speaking sales people and calls with a +44 prefix trying to sell you appointments.   Just recently, the 79 Group that was being marketed here in KL promising returns of 12-15% through a group of private equity returns got identified as a Ponzi Scheme. 

https://www.thebusinessdesk.com/northwe … on-impacts

It is impossible to run a bond or a guaranteed investment above 7% otherwise, all banks would be invested in that and never give loans.  Anyone who promises you returns of 10%-12-%, 15% with no risk is lying to you.  Only 2 things are a guarantee in life, death and taxes.

Choose a group where you can meet and speak with the fund manager, not through a broker.  Pick one where the fund manager and the person selling you the product are at least 75% invested in their fund otherwise they don't care if the fund makes money because they make commissions.  Get references of existing members, Get a WRITTEN schedule of fees, DEMAND 24/7 access to your portfolio and a summary of all charges to your account (get ready to be surprised), INSIST on monthly summaries.  Most brokers will not contact you once they have your money.  They will send you a canned report every quarter if you are lucky and you will not get a report of your assets unless you request it.  In addition, if you need funds urgently, you are out of luck because they will take 2 months to get the money to you.

I may sound bitter because I am and my eyes have been opened wide over the last 5 years.  Wouldn't you be upset if you found out you lost over $100K in fees and charges? Look at the published returns of brokerage houses and funds.  99% of them report PRE-FEE returns.,  from that, subtract a minimum of 4% (the cheaper ones) but an average of 6-7% and then you will see what you may expect as a real return.  Look for those reporting POST-CHARGES returns instead (if you can find any). Did you know that the huge SEC Penalty fees charged from court settlements are not paid by the firm itself but out of the investor's asset pool of funds?  There is no accountability!  Why would they stop illegal behavior if they are fined millions but make billions by breaking the law and nobody goes to jail?

I found an alternative to that and will never look back.

Remember, it is YOUR hard-earned money and nobody will look after it better than you will.  Verify before trusting someone who sells you someone else's products.  Ask the right questions like:

Are you a millionaire yet?  Why not if your product is so good? Are you invested in it? What % of your assets?

Can I speak to the fund manager directly?  Is he fully invested in his funds?

Can I have a historical summary of the fund returns (AFTER FEES) for the past 10 years

Do they claim to be protected by insurance through operating in the Isle of Man? (Doesn't apply if you live in Malaysia)

Can I have a detailed schedule of fees before I invest?  How much commission will you be getting if I invest?

How long has the company been operating? How long have you worked for them? Where were you before?

Have there ever been lawsuits against the company?

Has the company changed its name in the past?

Can you give me references of investors who have funds with you for over 10 years?

GOOD LUCK AND BE SMART ABOUT WHERE YOU PUT YOUR MONEY.  THINK ABOUT YOUR KIDS' FUTURE.