Don't Get Trapped in Illegal Money Dealings
Excerpt from a bank brochure ...Andrew K H Tan at 
http://www.HotelBookingPro.com
1.What Is A "Get Rich Quick" Scheme ?
A plan which offers high or unrealistic rates of return for a small 
investment while at the same time promising that such investment is easy and 
risk-free.

The following "Get Rich Quick" schemes are prohibited under the legislation 
administered by Bank Negara Malaysia:

Illegal Deposit Taking Activities
Illegal deposit taking is an act of receiving, taking or accepting deposits 
( moneys, precious metals, precious stone, any other article etc.) from 
members of the public that promises a repayment with interest or returns in 
money or money's worth without a valid licence under the Banking and 
Financial Institutions Act 1989(BAFIA)

Penalty : The maximum penalty for accepting deposits illegally is 
imprisonment of not more than 10 years and/or a fine not exceeding $10 
million and a fine of $100,000 for each day the offence continues.
*Investors in illegal deposit taking activities can be charged for abetting 
and face the same penalty as the operator of the scheme.

Illegal Foreign Currency Dealings
The following acts tantamount to illegal foreign currency dealings:
(i)Buying or selling of foreign currency by a person who is not an 
authorised dealer unless such person has obtained the permission of the 
Controller of Foreign Exchange under the Exchange Control Act 1953 (ECA)

(ii)Buying or selling of foreign by a resident who is not an authorised 
dealer with a person outside the country except if the resident has obtained 
the permission of the Controller of Foreign Exchange under the ECA.

Penalty : The maximum penalty for dealing in foreign currency illegally is a 
fine not exceeding $1 million or imprisonment for a term not exceeding 5 
years or both and the court may order any currency or any property involved 
in respect of the commission of the offence to be forfeited.

*Investor in illegal foreign currency dealings can be charged for abetting 
and face the same penalty as the operator of the scheme.

!Caution : Internet Investment Schemes
Members of the public are cautioned to be on guard against investment 
schemes are not licensed or authorised by the Official Country Bank to 
accept deposits or deal in foreign currency. Such schemes often come in 
guise of attractive investment returns or opportunities involving 
unrealistic rates of returns with zero to low risk.

Investors are reminded that they should only place deposits with 
institutions licensed or deal in foreign currency with institutions 
authorised by the Bank. Unlicensed operators may cease operating their 
business resulting in the investors with no means to recover their 
investments or seek redress against the persons connected with the scheme.

2.How Do You Spot The Scams ?
*Illegal Deposit Taking Scam
The person (an individual, a company or an organization) receives, takes or 
accepts deposits from members of the public and is not licensed under 
section 6(4) of the BAFIA;

*The person promised to repay the deposit, with or without interest or 
returns, over a period of time in the form of money or money's worth, etc,; 
and

*The person promises to repay the deposit, with or without interest or 
returns, over a period of time in the form of money or money's worth, etc,; 
and

*The person promises to repay the initial deposit upon demand or at a time 
or in circumstances agreed by or on behalf of the person making the payment 
and the person receiving it, with any consideration in money or money's 
worth (the repayment of initial deposit is sometimes included in the fixed 
interest or returns promised).

Warning Signs for Investors
*Illegal deposit taking activities have been disguised and camouflaged in 
various forms to deceive the public to fall victim to the investment scams, 
by giving valuable goods as part of the promised returns and camouflaging 
the deposits as loans
to the company;

*Illegal deposit taking activities appear to be able to provide high or 
unrealistic rates of interest or return over a short period of time as 
compared to licensed institutions. However these schemes will not last long;

*The survival of this scheme is dependent upon the recruitment of new 
depositors, i.e, new funds obtained will be used in paying dividends to the 
existing depositors

Therefore, the scheme will fail when there is no contribution of funds from 
new depositors;and

*Initially the depositors may be paid their promised returns.However, the 
operator would eventually abscond with the moneys collected when he feels 
that the schemed is about to fail, thus leaving the depositors at the losing 
end.

Illegal Foreign Currency Scam
Foreign currency dealings with a person, other than an authorised dealer, 
who has not obtained the permission of the Controller of Foreign Exchange 
under the ECA, often:
*Offer investors or members of the public the opportunity to deal in foreign 
currencies overseas);

*Facilitate the trading of foreign currencies by providing access to the 
principal company's website and trading via Internet;

*Recruit fresh graduates as marketing executives and allure them to get 
their family members to invest;

*Instruct the investors to deposit the investment moneys into either the 
principal company's bank account or a third party bank account;and

*Induce the investors to top up their investment ("margin call") or 
otherwise risk losing their investment.

Warning Signs for Investors
Illegal operator of foreign currency scams will try to entice potential 
investors with a marketing strategy which promises quick and high returns:

*Projecting a professional and reputable image with smart looking employees, 
a high tech office layout and advanced IT facilities where investors are 
induced to operate their accounts via the Internet;

*With tools of the trade,eg., a news screen showing movements in exchange 
rates, to give the impression that a professional and legitimate business is 
being conducted and

*A business contract is usually entered into between the investors and the 
company.Such contracts are usually left unsigned by the company.This means 
no action can be taken by the investors against the company as there is no 
binding written contract.

3.How Do You Protect Yourself From Scams ?
*Remember the golden rule - if it sounds too good to be true,it's probably a 
lie;

*Deal only with licensed financial institutions and authorised dealers;

*Check with the relevant authority before investing;

*Don't be pressured or rushed to invest;

*Be extra careful with investments over the Internet;

*Be sceptical of any investment opportunity that is not in writing;and

*In case an investment has been made, keep copies of all investment(s) and 
communications.

SPEAK UP, Forward this to your contacts
Do your part in stopping illegal "get rich quick" schemes today. Help us to 
stop them now.

Link : 
http://blog.hotelbookingpro.com/2008/03/dont-get-trapped-in-illegal-money.html