SC warns public of pre-initial public offering investment scams

KUALA LUMPUR: The Securities Commission Malaysia (SC) has cautioned the public on investment scams enticing investors with pre-initial public offering (IPO) shares of companies seeking listing on Bursa Malaysia.

In a statement today, the SC said these scams, mostly involving private placement offerings, are usually timed with upcoming IPO listings published on Bursa Malaysia’s website.

“Perpetrators of these scams, posing as ‘agents’, usually create a public group on WhatsApp to promote these pre-IPO investments. Following this, potential victims will be added to said group unsolicited.

“These schemes may be accompanied by fake testimonials from other investors to appear credible. Payments for the ‘subscription’ will be required to be made to bank accounts of entities not related to the IPO and suspected mule bank accounts,” it said.

The agency also noted that on the listing day, “agents” (will) claim that the shares have been listed and have made profits, prompting additional payments for the shares to be allotted.

“This is fraudulent, and is to convince the victims to give more money,” the agency added.

To date, the SC has received various complaints and inquiries from investors reporting substantial losses, exceeding RM800,000.

The SC views this matter seriously and will continue to monitor and take appropriate action against such investment scam activities.

The public is advised to be vigilant in evaluating investment offers, ensuring that they do not transfer or deposit money into suspicious accounts, and to verify investment offers through the SC Investment Checker at www.sc.com.my/investment-checker.

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