Swisscash scam: SC secures RM31m settlement

KUALA LUMPUR: The Securities Commission (SC) has entered into the largest settlement in its history involving RM31 million over the Swisscash investment scam and it will use the money recovered to restitute eligible investors affected by the investment scam, said SC chairman Tan Sri Zarinah Anwar.
The payment is made possible following a consent judgment entered on Nov 6, 2009, with two Swisscash defendants, Albert Lee Kee Sien and Amir Hassan. This marked the SC's three-year investigations, including cross border, to pursue the mastermind of the Swisscash scam in Malaysia.

“It had affected thousands of investors and prompted painstaking cross-border investigations and legal jurisdictions over more than three years. So far, 3,000 people have lodged complaints to the SC alleging losses,” she said at a press conference on Nov 13. The investors were Malaysians and some foreigners.
Zarinah said the first batch of payments was expected to be made early next year. However,  there would be several stages involved, including submitting the criteria for investors' eligibility to court, appointing an administrator and also placing of advertisements in newspapers.

"But not all (complaints) will be entertained. Investors must show proof of their investments,” she said adding investors who were also "recruiters or upliners in the scam will not be considered for compensation". Investor which invested in Swisscash after the SC issued the warning on Nov 5, 2006 might also find difficulties in securing compensation.

Investors would only be compensated based on the amount of their initial investment, without any profits. The SC would also soon publish a notice, setting out the process for Swisscash investors yet to register their claims.

Zarinah stressed investors in illegal scams could not expect the regulators to help regain their their investments, pointing out Swisscash was an exception as the funds were recovered by SC’s effort and close cooperation and support from SC’s counterpart in various countries.
To recap, since 2006, the SC had been receiving queries about Swisscash from the public since 2006. Upon discovering SwissCash was a form of pyramid scam, SC took down the website in 2007 with the cooperation from Malaysian Communications and Multimedia Commission (MCMC) and Cybersecurity.
“The assistance rendered by the MCMC and Cybersecurity were instrumental in helping us identify and block access to the SwissCash-related website by the Malaysian public,” Zarinah said, adding that prior to the website closure, SC had been issuing warning to investors.

The four Swisscash-related websites which the SC had blocked -- www.swisscash.net, www.swisscash.biz, www.swissmutualfund.biz and www.swisscashguide.com.

On June 18, 2007,  the SC filed a civil suit at the Kuala Lumpur High Court against Albert Lee and six others involved in the Swisscash scam operated over the internet.  In the same month, SC obtained a World Wide Mareva injunction to prevent all defendants from disposing their assets.
By September, one of the defendants, Amir Hassan was ordered to transfer RM12.5 million from overseas bank accounts back to Malaysia and in November, the SC succeeded in entering into consent order with Albert and Amir for a total sum of RM30 million.

Asked on the profile of investors that were duped in the scam, Zarinah said it was surprising as 80% were professionals, male, and the rest housewives, teachers and older people. She said that same investors had even invested “in the region of several millions (ringgit)”.

Read More @ http://www.theedgemalaysia.com/business-news

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