Beware clone firm scams, says Securities Commission

KUALA LUMPUR – The Securities Commission Malaysia (SC) today cautioned the public on the sharp increase of clone firm scams this year.

These scams see companies fraudulently impersonating legitimate entities and misusing names and logos of public listed companies (PLCs) to dupe investors and solicit funds, said the commission.

These clone firms offer non-existent investment opportunities in the shares of these PLCs, promising unrealistically high returns within a short span of time. 

The commission had previously issued an alert in May against fraudulent clone firms posing as licensed capital market intermediaries.

The latest cloning scams include PLCs in the medical, glove and property sectors that had garnered investor interest during the COVID-19 pandemic. 

“The targeted entities have lodged police reports and/or made a complaint to the SC on the cloning of their corporate identities by unknown persons or organisations,” said the commission.

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.

The victims are often instructed to provide personal information such as their names, NRIC numbers and bank details, after which they will be directed to transfer funds to the personal bank accounts of the scammers. 

Victims are usually encouraged to part with more money on the pretext of income tax payments, administrative fees, bank charges, withdrawal fees, or exchange rates

“The SC would like to remind the investors to always exercise caution when evaluating investment opportunities, especially those promising very high returns with little or no risk and to seek the counsel of licensed and legitimate advisors,” said the commission. 

Investors can verify the status of individuals or companies via the SC website here and here.

“The SC also urges the public to verify bank account details at the ‘Semak Mule’ online application and website made available by PDRM’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.”

Members of the public who suspect that they have been approached by such fraudsters may lodge a report with the Consumers and Investors Department at 603 6204 8999 or email [email protected]. – The Vibes, November 5, 2020