If deals are too good to be true, think twice

PETALING JAYA: There are many gold schemes available on the market but if the “consultants” offer deals that are too good to be true, the advice is: think twice.

Source from (The Star Online): http://thestar.com.my/news/story.asp?file=/2012/10/3/nation/12117101&sec=nation
Published: October 03, 2012

Fund manager Danny Wong said investors should be careful of companies offering double-digit returns with no risk of losses, adding that it was unlikely that a company could get high returns without taking high risks.

“Investors should ask for more information about the companies they plan on investing their money in. Suspicious companies usually won't provide details like papers on studies or analysis,” he said.
Wong said the public should also avoid investing in companies without proper endorsement from Bank Negara Malaysia (BNM) or the Securities Commission (SC).

“A company that is licensed to take deposits or is in investment-related businesses will definitely be listed on BNM and SC websites,” he said.
The list of companies and funds registered with SC are available under the Data & Statistics section of its website (www.sc.com.my).

BNM provides a site (www.bnm.gov.my/microsites/fraudalert) which has guidelines on how to avoid being defrauded by doubtful banking and investment institutions.
The central bank's fraud alert site enhances public awareness on the dangers of falling prey to illegal financial schemes and lists information such as the definition of financial fraud, how to avoid becoming a victim, available enforcement action, how to report a fraud and a Frequently Asked Question (FAQ) section.

The list of financial fraud activities prohibited by BNM includes illegal deposit taking, illegal Internet investment schemes and unauthorised use of credit or debit cards.
“Generally, if the offer is too good to be true, people are advised to be wary and make an effort to verify the validity of the promised high returns,” BNM said on the website.

The site also urges those who had fallen victim to illegal schemes to lodge a police report and file a compliant to the relevant enforcement agency.
It also urged victims to keep all related documents of investments such as bank-in slips, deposit slips, agreements and vouchers received from the company or the perpetrator to enable action to be taken.