Originally Posted by BusinessTimesMalaysia
Published July 3 2007
Kuala Lumpur Files Lawsuit Over Online Scam
by S JAYASANKARAN IN KUALA LUMPUR
In an unusual move, the Securities Commission, Malaysia's Capital Market Regulator, has taken civil action against the promoters of an alledged investment scam over the internet that could have bilked Malaysian and other investors by as much as RM285.5 million (S$126.7 million)
In Documents lodged in the high court of Malaya, the regulator accused the promoters of 'Dishonesty' and 'Fraud' of operating without necessary Fund Management and Investment Licenses, and of Money Laundering - all offences that are criminally punishable.
Indeed, it might be noted that promoters of the alledged scam would also have fallen foul of Malaysian Banking Laws for accepting deposits without a License. But the Central Bank was'nt involved and the commission chose to take civil action, in tacit acknowledgement, perhaps, of the generally unsuccessful nature of previous prosecutions.
Quite a part from the fraud implicit in the investor schemes, the action of the authorities also signals an attempt to police the internet - at least the Malaysian Investors - through judicial means.
On June 21 2007 , the high court granted sweeping injunctions to the commission to freeze the assets - primarily deposits in Malaysian Banks - of three Malaysians and four companies linked the the individuals. The promoters named by the SC are Albert Lee Kie Sien, Kelvin Choo Mun Hoe and Amir Hassan who, the commission alledges, used their so called Swiss Mutual Fund and SwissCash as the High Yiels schemes that promised '300% Returns Over 15 Months'. The Government has already blocked the websites but the court further restrained the defendants from continuing to promote their schemes.
Meanwhile, when the full trial begins, the SC is asking that all monies be collected by the trio to be returned for redistribution to investors as well as cost and other relief. It isn't clear if the case will be fought at all: according to the SC affidavits, none of the promoters , except Mr amir hassan, have inquired about the freezing of their and their companies Bank Accounts. Niether has there been any attempt to lift the injunctions.
According to the Affidavits , the SC was first alerted to the schemes after the Hong Kong Securites and Futures Commission placed SwissCash on a list of scam websites following complaints from hong Kong Investors. This was followed by a denial by the Swiss Embassy in Kuala Lumpur that SwissCash had any Swiss roots. It isn't really clear how far flung the schemes were. The affidavits state that SwissCash was under investigation by the Jersey Financial Services Commission, which froze one of Mr Albert Lee's accounts in Barclays Bank in December last year. When Mr Lee asked to close his account, which had over $1.7 million and transfer it to julius Baer (SINGAPORE) Ltd, the Bank refused citing the police investigation.
Clearly Hong Kong Investors were also involved. The affidavits said that SwissCash investors were told to transfer their monies to a HSBC account in Hong Kong operated by Amir Hassan. In April accoeding to the affidavits, the accounts balance stood at nearly HK $16 million (S$3.1 million)
It's believed that malaysian and other investors may have handed over as much as RM585.5 million. The angst over the internet scams by Kuala Lumpur is also rooted in the fact that many of the investors were ethnic Malays. Indeed , the National Fatwa Council in April declared that such High-Yield investments schemes as 'Haram' and, thus beyond the pale of any Muslim.
Currently 22 Malaysian bank Accounts - cumulatively holding about RM2.9 million - operated by the three men and their companies have been frozen by the authorities pending the outcome of the trial. According to Bankers close to the commission, Malaysian Agency Officials met with their Singaporean counterparts last week to discuss the SwissCash scam, but it is not known if anything has materialized.
