Such schemes, known locally as “skim cepat kaya”, have made Malaysians lose millions of ringgit.
According to the police’s Federal Commercial Crime Investigation Department, there were 17,311 cases opened for investigation last year, a massive jump of 26.6% from 2007.
The department said that one bright spot in all these cases was that actual financial losses were down to RM845mil last year, compared with RM1.9bil in 2007.
Most of these schemes thrived in “grey areas” which can only be loosely regulated despite the best efforts of the authorities to clamp down on culprits.
Many of them operate under the guise of multi-level marketing operations which blur into pyramid schemes, which are illegal.
A market observer pointed out that these establishments would promise returns that even top fund managers found hard to attain in good economic times.
Many of them operate like Ponzi schemes which made no or little actual investments from money collected from the public.
Often in such schemes, the earlier investors would usually get some returns, compared with those who join later.
Surprisingly, many of those who are employed as agents with these businesses do not think such schemes are illegal.
“How can it be a scam when I can make money?” an agent attached to an established restaurant chain said.
The restaurant has half a dozen outlets in the Klang Valley and offers the public membership for a fee which entitles them to make money from eating at the outlets and through referrals.
What makes it interesting is that several of these establishments found taking deposits or cash from the public have been operating for a number of years without ever being questioned by the authorities if their operations are legal.
In the past one-and-a-half years, there has been a significant rise in such operations.
Their aggressive and “successful” marketing approach has even become somewhat of a trend, and has been adopted by many other restaurants to boost sales.
If one were to google the term “scams in Malaysia”, one would find a slew of businesses which concerned citizens have exposed as a “bit dodgy”.
However, the people who run such operations appear nonchalant about the amount of media and Internet attention on their businesses.
They are able to navigate their way around existing laws and capitalise on their marketing strategies before the law catches up with them.
Starprobe decided to investigate a number of these business operations to find out their modus operandi following a number of helpful suggestions from concerned readers and members of the public, especially cases which relate to non-financial institutions.
The response from an official of the Registrar of Companies (ROC) was that it had no jurisdiction to control the activities of such companies.
“If the company is registered with an identifiable business, how they market their products or services is not within our purview,” the official said.
But with regards to companies illegally taking deposits without having an investment licence, Bank Negara has the right to investigate and prosecute them. In fact, from last year until now, 19 companies have been under investigation and raided.
While the authorities are trying their best to enforce the laws, the sheer number of these operations make it an uphill task.
The situation is compounded by having different agencies with different jurisdictions conducting investigations independently, thus not giving a clearer picture.
For example, Consumer Claims Tribunal chairman Rungit Singh said his tribunal has jurisdiction only over consumer complaints and concerns. The tribunal is under the purview of the Domestic Trade and Consumer Affairs Ministry.
“Once a person invests in a scheme, that person is not protected under the consumer laws,” Rungit Singh said.
According to him, consumer laws only cover complaints regarding goods and services and do not have jurisdiction over investors.
And on multi-level marketing, an official from the Consumers Association of Penang said such companies were perfectly legal as long as they were licensed by the Domestic Trade and Consumer Affairs Ministry.
“However, some multi-level marketing operations get into grey areas when the bulk of their sales are not derived from products or services but rather from other forms of collections,” she said over the phone.
She added that a sign of a possible scam was when most of the earnings of the company is derived from activities unrelated to the sale of goods or services.
According to a commercial crime lawyer who did not wish to be named, the law regarding legal and illegal activities was clear.
“However, access to critical information may be time-consuming and the prosecution of those who deliberately go against the law will require substantial evidence,” he said.
The lawyer said there was a need for easier and quicker access to information on registered businesses, possibly delivered via a centralised system and an oversight board with experts for the public to turn to for complaints, advice and information on confirmed scams.
“There is a need for a quicker mechanism to identify and respond to scams before more people lose their money,” he said, adding that many of the scams had invested little in their marketing strategies and did not have a business continuity plan.
The lawyer said it should be noted that there were also a number of people who were either gullible or prepared to take higher investment risks driven purely by greed, despite the best of advice.
A source who tracked such scams said it was near impossible to keep tabs efficiently on them.
“That’s the biggest problem, there are thousands of such scams involving hundreds of millions of ringgit out there that the relevant agencies are not able to track all of them. They’re only able to pursue the ones that have been brought to their attention,” she said.
She added that the answer was not more regulation but more awareness of such scams.
“Awareness is better now than before, we have more inquiries coming in on various businesses,” she said.
Monday, July 13, 2009
Such schemes, known locally as “skim cepat kaya”, have made Malaysians lose millions of ringgit.
Sunday, May 31, 2009
Tuesday, May 26, 2009
Thursday, April 9, 2009
Monday, April 6, 2009
Wednesday, April 1, 2009
Sunday, March 22, 2009
Friday, March 20, 2009
Thursday, March 19, 2009
When a person doesn't buy insurance like medical card and personal accident, he is still insured. Why? It is because he is the insurance company. He pays his medical bills himself.
Wednesday, March 18, 2009
We can go to a government hospital. The medical bill there is very economical. However, we need to wait for a long time before we get a treatment. When we are injured seriously, do we have the time and patience to wait? If the answer is no, every consumer should have at least one medical card.
Of course, a medical card doesn't guarantee us an admission to all hospitals without a deposit in Malaysia like what I have explained previously in my post titled WILL A HOSPITAL ACCEPT OUR MEDICAL CARD AS A GUARANTEE OF ADMISSION TO THE HOSPITAL WITHOUT A DEPOSIT? (March 17, 2009). But, it at least helps us to admit to all of the panel hospitals of an insurance company without a deposit.
Tuesday, March 17, 2009
WILL A HOSPITAL ACCEPT OUR MEDICAL CARD AS A GUARANTEE OF ADMISSION TO THE HOSPITAL WITHOUT A DEPOSIT?
Monday, March 16, 2009
Sunday, March 15, 2009
Saturday, March 14, 2009
Source: The Star Online, Business, March 14, 2009
Tuesday, March 10, 2009
Sunday, March 8, 2009
Saturday, March 7, 2009
- Total assets as at 30 November 2008 was in excess of RM 17 billion of which more than 97 % of the invested assets are in Malaysia.
- Profit before tax was RM 428 million.
- Surplus above the solvency margin requirement as at 30 November 2008 was RM 2.3 billion.
- Capital Adequacy Ratio as at 30 November 2008 under the Risk-Based Capital Framework was 266 %, well above the regulatory minimum of 130 %.
March 3, 2009
Thursday, March 5, 2009
Tuesday, March 3, 2009
Saturday, February 28, 2009
Okay, we are applying for medical card and we have been told that the insurance company requires a medical exam (usually paid by the insurance company). The exam typically consists of blood and urine samples, blood pressure readings, height and weight measurement and a medical questionnaire. Information from the medical exam will be used by the insurance company to help determine our health class. The health class the insurance company assigns us will determine our premium rates. So, it is very important that we get the best medical results.
The following tips are to help us attain the most favorable and accurate exam results:
- If we can, it's best to fast for a period of at least eight hours prior to the exam. This step will result in more accurate blood test results. Early morning appointments may be appropriate.
- If we must eat prior to the exam, no heavy meals and little or no caffeine on the morning of the exam. Decaffeinated coffee and a light breakfast would be best.
- Stay off salt for 3-4 days prior to exam. This step may have a beneficial effect on our blood pressure.
- No alcohol for 24 hours prior to the exam as alcohol tends to elevate blood pressure for 12 -24 hours.
- Get a good night's rest before the examination.
- If we smoke, don't smoke within 30 minutes of the exam. Smoking tends to constrict artery walls and elevate blood pressure.
- If we have an acute illness (i.e. the 'flu'), we should consider rescheduling the exam as some acute illnesses affect the urine and blood tests.
- (For female only) We should tell the examiner if we have our menses as our urine will be affected and a notation can be put on the lab slip.
Source: Modified from http://discussion.lifeinsure.com/
Friday, February 27, 2009
Thursday, February 26, 2009
Wednesday, February 25, 2009
Tuesday, February 24, 2009
Sunday, February 22, 2009
Saturday, February 21, 2009
Friday, February 20, 2009
Thursday, February 19, 2009
Tuesday, February 17, 2009
According to a doctor from Pusat Rawatan Islam Sdn. Bhd., nearly 98 % of all women have fibroids either small or large. The cost of the operation in one of the hospitals in Seremban was around RM 12,000 in the year of 2007. The cost now will be much higher than the cost in the year of 2007.
A female patient who has medical card doesn't need to be worried about the cost as this risk will be borne by insurance companies.
For details about fibroids, please click the following links:
Monday, February 16, 2009
Saturday, February 14, 2009
Thursday, February 12, 2009
- non payment of premium or premium not made on time.
- fraud or misrepresentation of material fact during application.
- this policy is cancelled at the request of the policyholder.
- total claims of this policy have reached the lifetime limit specified.
- on the death of the insured (hence terminating coverage for dependants too).
- the insured ceases to qualify as a dependant.
- the insured attains the coverage age limit specified.
- termination of coverage for all policies in a certain market and the company withdraws this policy completely from the market in accordance with the Portfolio Withdrawal Condition.
- termination of a plan to which ExcelCare Plus rider is attached (if applicable).
If all the situations above don't happen, a policyholder can renew his coverage easily. In sum, it is very important to make sure that our medical card is renewable every year so that we still get the protection we need the most at older ages.
Monday, February 9, 2009
When we want to get treatment in a clinic, our life insurance and medical card generally don't pay us. So, we need to buy a personal accident plan as a rider attached to our life insurance.
Compensation will only be made by an insurance company if an insured is still alive for at least 30 days after he is diagnosed with one of the 36 critical illnesses. In other words, he and his family will get nothing if he dies within 30 days after he is diagnosed with one of the 36 critical illnesses. However, this clause doesn't apply to all 36 critical illnesses plans in the market.
- The definition of accidental injury does not require qualifying words of violent external visible means.
- Injuries caused by gas inhalation, drowning or similar misfortune with no external sign of injury.
- Food poisoning.
- Immediate death or injury caused by harmful insects or snake bites.
- No exclusion on intoxication.
- Injuries resulting from hobbies on any sports or games.
- Death or injury by murder or assault.
- Injured as a non-participant in riots and civil commotion.
- Injuries caused directly or indirectly by fire.
- Motor cycling risk.
- Injuries while on board as a passenger on scheduled or non-scheduled licensed flights.
- Injury while on board as a passenger on military air transport service of any Government anywhere in the world.
- Skyjacking risks.
- Injury caused by natural perils like earthquake, volcanic eruption, tidal wave, floods or lightning etc.
- Injury resulted from radio-active emission.
- Grace period of 31 days provided. No worry for due dates.
- Renewal bonus of 5 % on the original Accidental Death And Dismemberment sum assured (maximum RM 300,000) for 8 years.
- No medical examination is required when applying.
- No territorial limitation (except war zones).
- World wide claim services.
However, some of the 20 benefits above may not be found in certain personal accident plans. For example, the 17th benefit (renewal bonus) can't be found in Easy Cover PA.
Wednesday, February 4, 2009
Tuesday, February 3, 2009
An insured is usually considered as an in-patient only if he physically stays in a hospital for minimum six continuous hours upon the recommendation of a physician. He must be a registered resident bed patient being charged for using the room and board facilities of the hospital. Patients who don't fulfil the requirement are considered as out-patients. In other words, out-patients are receiving medical are or treatment without being hospitalized.
Monday, February 2, 2009
- malicious damage
- strike & riot
- aircraft damage
- impact damage
- bursting of pipes
- other perils.
Sunday, February 1, 2009
Saturday, January 31, 2009
Thursday, January 29, 2009
- real property / immovable property
- personal property / movable property
- tangible personal property
- intangible personal property
- property right
Before his estate can be distributed according to his will or the related law, he has to settle all of his debts or liabilities like taxes, loans and others. So, he still has to settle his debts even with a will. Without a will, the distribution of his estate will take a longer time than the time he takes when he has a will.
Real property refers to anything that is permanently attached to a land such as buildings, houses, shoplots and so on (including lands). These items can't be moved.
Anything that is not real property is called personal property. Personal property can be either tangible or intangible. Tangible personal property refers to physical personal property such as cars, watches, jewellery and so on. Whereas intangible personal property refers to anything that we can't touch or hold like shares, bonds, business secrets, copyright, trademarks and others.
Generally, a property right is the legal right to use resources or refers to the ownership of resources like lands, capital and other goods.
The theories of property are very complicated. For details, please click the following links:
Wednesday, January 28, 2009
Tuesday, January 27, 2009
When a person dies intestate (without making a will), his assets will become an estate. After his liabilities have been settled, his remaining estate will be distributed according to the Distribution (Amendment) Act 1997 in West Malaysia and Sarawak. Intestate Succession Ordinance 1960 is the law governing intestacy in Sabah. Both laws are only applicable to non-Muslims and non-natives. For Muslims, the law governing intestacy is Islamic Distribution Laws.
For details, please click the following links:
Please read my posts titled WHAT WILL HAPPEN TO A PERSON'S ESTATE IF HE DIES TESTATE (WITH A WILL)? (January 28, 2009) and FINANCIAL PLANNING SEMINAR (THIRD DAY). (January 21, 2009).
Monday, January 26, 2009
2. Bahasa Malaysia
Sunday, January 25, 2009
For those who have more than one car under their name, NCB is transferable from one car to one of the other cars. For example, car A is a new car (high premium) and car B is an old car (low premium) and they are entitled to a bonus of 25 % and 55 % respectively. The owner of these two cars can transfer the NCB from car B to car A to enjoy more discount. In other words, car A and car B now are entitled to a bonus of 55 % and 25 % respectively. Car A and car B must be owned by the same driver in order to enjoy this benefit.
In order to overcome this problem, the insurers have to adopt more stringent underwriting controls on motor insurance including the application of premium loadings. As a result, the renewal and availability of motor insurance in 2009 will be significantly affected.
However, fortunately, motor vehicle owners who find difficulty in obtaining or renewing their motor cover can turn to the Malaysian Motor Insurance Pool (MMIP) to obtain motor insurance protection for their vehicles.