How To Get Your Money Back From Financial Scams Team Team

Last updated 11 February, 2022

All sorts of scams have been active in Malaysia lately. Although we have previously warned you about common scams in Malaysia, you might still have fallen for one of the elaborate scams that people employ to deceive you.

Recently, the JJPTR forex exchange fund has been revealed as an elaborate financial scam, and the mastermind, Johnson Lee, has been arrested. If you’ve lost a lot of money to one of these scams you might be wondering what your rights are, and how you can get your money back. Let’s get into it.

Depending on the type of scam that you were involved with, there might be different steps you can take. Financial scams are generally designed to obtain as much money as possible and then disappear. This makes getting your money back relatively difficult.

That being said, a financial scheme does not necessarily have to be illegal. For example, an investment fund might promise a 20% return but actually make a -3% loss. That does not make the investment fund illegal, it just makes it unreliable. In this case, any money you lose is your responsibility. It is your responsibility to UNDERSTAND how the investment fund works and what kind of returns you can expect.

However, an investment fund that simply pretends to be investing by moving money around is an illegal financial scheme and you can report this as a crime. If the money can be retrieved you are entitled to a 100% refund, and you can even sue for damages, but that is up to you. Let’s look at some steps you can take when you got scammed.


Related: Online Love Scams: Here’s How To Outsmart A Romance Scammer!

1. Confront the people responsible

If you are convinced you have been scammed, the first thing you can do is contact the people responsible. If you can find or contact them you might be able to convince them to give you your money back.

It could be that the scam is still in progress and the scammers want to keep you from making a scene and might give you your money back. For example, you could threaten to expose the scheme on social media, which will likely put a scare into the people at the top because even the hint of a financial scam could make the entire thing come tumbling down. A good way to do this is through Ponzi Scheme Alert Malaysia, a Facebook group dedicated to revealing financial scams in Malaysia.

The big problem here is contacting or finding the people responsible for scamming you. With most scams, the actual people responsible are nowhere to be found, and this can be a huge obstacle.

2. Keep all records and documentation

With any large scale financial transaction you do, you should keep a detailed financial record. Most banks already give you a basic description for every transfer you make, but you can supplement this information with extra context such as the purpose of the transactions, the expectations tied to them, and any information of the intended recipient.

This way you will have an extremely detailed oversight of your engagement with the scammers when you are trying to figure out what happened to your money.


3. File a police report

If confronting the culprits is not successful, your next step is to file a police report. The police report counts as the first official indication of the alleged fraud that has been committed against you. Any further legal action you intend to undertake to get your money back is dependent on this police report.

The police report urges the police department to start an investigation into the scam. Depending on what they find, they can then extend the investigation to include other authorities that might deal with financial crime and illegal financial schemes, such as the Commercial Crime Investigation Department (CCID)

4. File a report with Bank Negara Malaysia

Next to filing a police report, you can file a report with Bank Negara Malaysia. As the central bank of Malaysia, they keep an eye out for any illegal financial schemes that might try to exploit people. You can file a report with Bank Negara here. In case you are wondering whether an investment is a scam, you can check out their list of known financial scams in Malaysia.

5. Keep details of the officers/key personnel that you involved with

This does not only apply to scams but can be applied to business in general. Always keep a record of anyone that you deal with professionally or when dealing with money. Money can people make do crazy things, so it is always a good idea to keep tabs on everyone you are involved with.

If you have been scammed but you do have their personal and contact information, it will be easier for you to contact and find the scammers afterwards. Any investigation into the scam will go a lot smoother since it will be a lot harder for the scammers to disappear.


6. File for civil legal action (sue them)

If you have enough evidence, but the government cannot file a criminal case, you can choose to start a civil case against the scammers.  You can sue the financial scheme for any damages incurred, so if you invested RM 25,000 then you can sue them for that amount.

However, if the cost of suing is higher than the rewards you might or might not receive, a civil case is not worth the effort. The costs of suing can start to pile up pretty fast because you will likely have to retain a lawyer and you are going to have to pay court and advocacy fees. Your combined court and advocacy fees can get as high as RM 1,000. A good lawyer can easily cost you RM 60 an hour and civil cases can take a long time. Before you take civil action, make sure you don't spend more money for nothing.

Even if you decide to sue, do you know who you are targeting? Do you sue the company or the person? If you sue the company, the people behind it could be protected from damages and there might not be any money left in the company. On the other hand, you might not have the legal basis to sue the people behind the scheme because you were not directly involved with them.

That’s all fine, but what are my rights?

Your rights depend very heavily on the type of scam that you are involved with. If the investment scheme was not technically illegal but simply misleading, you are going to have trouble getting your money back. Even if the scam is determined to be illegal, chances are that the people responsible are nowhere to be found.

If the scheme was illegal, then you have been subject to financial fraud and the scammers have committed a criminal offence. In this case, the Commercial Crime Investigation Department will attempt to prosecute the people responsible if there is enough evidence. If the searches and seizures related to the investigation lead to the money, you might see some refunds but don’t count on it.
It is way more likely that the scammers have either transferred the money away in some untraceable accounts or have spent it already on luxurious things like boats, cars and jewellery.

Bank Negara provides a watch list for likely investment schemes and you can file a report with them in case you got scammed, but generally, the enforcement level is low and you should not expect any action from Bank Negara to result in a refund for you.

Your best option is still to make sure that whatever you are investing in, is not a scam. Do not fall for investment schemes that promise unrealistically high results, it never ends well.

Related: 7 Types Of Shocking COVID-19 Scams All Malaysians Need To Be Aware Of

The team is comprised of many talented individuals, sharing their knowledge, experiences and research to help others make better financial decisions.


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