Exposing Modern Investment Frauds - Forex, Stock Market, and Cryptocurrency Traps - Overview by Nik Zafri

In the ever evolving world of digital finance, fraud and scams have also evolved becoming more sophisticated, harder to detect, and dangerously convincing. Investors, especially those new to online trading, are now increasingly vulnerable to elaborate schemes involving fake Forex platforms, stock market trading sites, and cryptocurrency exchanges.

1) The Illusion of Legitimacy

Fraudsters deploy advanced digital tactics to appear legitimate.

1. Fake Live Charts

Many fraudulent platforms use convincing, real-time charts to simulate active trading. These charts are entirely controlled by a back-end operator and bear no connection to actual market data. Investors are lured by apparent gains, only to be denied withdrawals later under false pretenses (e.g., needing to “upgrade accounts” or pay “taxes”).

2. Bogus Licensing and Fake Review Portals

Fraudsters create fake websites mimicking regulatory bodies or ranking agencies. These sites display fabricated ratings and licensing credentials, often appearing high on Google search results thanks to paid ads and SEO manipulation. Victims may believe they're investing through a "licensed broker" or "top-rated crypto exchange."

3. Interactive and Engaging Fake Platforms

Well-designed websites offer demo accounts, AI chatbots, and "account managers" to build trust. Some even use deepfake video calls or pre-recorded webinars to showcase fake testimonials and investor success stories.

4. Pretending to Fight Scams

In a bold twist, some fraudulent websites go to great lengths to appear trustworthy by displaying "anti-scam" warnings on their own platforms. They may even include links to real regulatory authorities like the SEC, FCA, or local police departments. This reverse psychology tactic is designed to lower your guard and convince you they are above suspicion.

2) Reducing the Risk - What You Can Do

1) Verify Licensing with Official Sources

In Malaysia, verify a broker or platform’s registration with:

Securities Commission Malaysia (SC) or Bank Negara Malaysia (BNM)

Both regulators provide Investor Alert Lists that identify unlicensed or suspicious entities.

1.1) International Verification

For international checks, refer to:

• Financial Conduct Authority (UK)
• U.S. SEC’s Investment Adviser Public Disclosure
• IOSCO (International Organization of Securities Commissions)

Avoid Platforms That:

• Pressure you into “urgent” investments
• Ask for payment via crypto or gift cards
• Block withdrawals without explanation
• Have no physical address or hide behind offshore jurisdictions

Report Immediately

Victims or whistleblowers can file reports with:

• CCID (Commercial Crime Investigation Department) – PDRM
• CyberSecurity Malaysia
• SC Malaysia Investor Affairs – hotline or online form
• The National Scam Response Centre (NSRC)

Conclusion

Financial scams today are not run by amateurs, they are often coordinated operations involving web developers, social engineers, and online marketers. The key defense is awareness, skepticism, and verification through official channels. Never let the appearance of legitimacy override proper due diligence.

#InvestmentScamAlert #CryptoFraudAwareness #ForexScamPrevention #VerifyBeforeYouInvest #StopOnlineScams

Cases where money disappear from customer's account - it's not a scam but fraud - By Nik Zafri

Free AI Generated from Google Search 

Disclaimer: This short article is not intended to discredit or generalize all banking institutions. Its purpose is solely to raise awareness and help customers understand the possible risks, as well as the appropriate steps to take should such incidents occur. Responsible banking practices and customer vigilance are both essential in maintaining trust and security.

A bank is expected to serve as a secure and trustworthy place to safeguard one’s money. However, there have been troubling incidents where funds have mysteriously gone missing, not due to scams, but without any clear trace accessible to the customer. In several cases, it was discovered that the theft was committed by the bank’s own staff, representing a serious breach of trust and governance. Such incidents typically involve insider threats, manipulation of internal systems, or exploitation of security vulnerabilities. In response, the bank has taken steps to strengthen its internal controls, enhance staff screening processes, and upgrade its cybersecurity measures.

Not limited to the following, these are some possible fraud cases and how the theft is disguised.

PREVENTIVE MEASURES (many have been adopted by the Banks)

1. Strong Segregation of Duties

• Prevent the same employee from initiating and approving transactions,
• Implement dual or triple controls for sensitive operations.

2. Mandatory Audit Trails

• Ensure tamper-proof, automated, and real-time logging of all activities.
• Logs must be independently monitored.

3. Behavioral Monitoring and AI Alerts

Use AI tools to flag unusual employee behavior (e.g., accessing dormant accounts, frequent manual overrides).

4. Strict Role-Based Access Control (RBAC)

• Limit access to transaction systems based on job role,
• Regularly review access privileges.

5. Regular Reconciliation and Surprise Audits 

• Reconcile customer transactions with system logs daily,
• Conduct surprise audits on branches and back offices.

6. Customer Notification Systems

• Immediate SMS/email alerts for any withdrawal, transfer, or account update.
• Let customers flag unauthorized transactions promptly.

7. Whistleblower Mechanism

• Encourage staff to report suspicious activities anonymously,
• Ensure whistleblower protection.

8. Periodic Penetration Testing and System Audit

• Test the integrity of core banking systems regularly,
• Identify and patch security vulnerabilities.

Real-World Cases

• Employees created millions of unauthorized accounts to meet sales targets.
• Fraud of over $1.8 billion through unauthorized SWIFT transfers.
• Hackers transferred $12 million after gaining access to SWIFT credentials (with suspected insider collusion).

ACTION

If you're a customer suspecting theft, take the following actions:

• Report to the bank immediately in writing - detail the events as much as possible and attach any relevant documents
• File a police report and Bank Negara (if in Malaysia) - ditto - 

Keep all documentation and get written acknowledgement from the bank.

APPLICABLE LAWS/REGULATIONS

• Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 (AMLA) - Applies when the money was diverted and later laundered through businesses, banking channels, or cross-border transactions. (e.g. Section 4),
• Malaysian Anti-Corruption Commission Act 2009 (MACC Act) - applies when there is report, suspicion and prove of abuse of power, bribery, or collusion by government or bank officers in the diversion of the money. (e.g. Section 23),
• Financial Services Act 2013 (FSA) - applies when the offense involves commercial banks or financial institutions regulated by Bank Negara Malaysia (BNM).
• Penal Code (Act 574)
• Communications and Multimedia Act 1998 (CMA) - applies when digital systems or networks were used to commit or conceal the crime.

SPECIAL NOTE : UNIQUE CASES YOU MANY NOT KNOW - DESTROYED MONEY THAT IS NOT DESTROYED

it is possible, though extremely rare and difficult to execute, for currency that is meant to be destroyed (burnt, shredded, or withdrawn from circulation) to be illegally diverted and laundered instead. This would typically involve high-level corruption, insider collusion, and breakdowns in oversight within central banks or cash-handling agencies.

1. Currency Destruction Process Manipulation

• Central banks periodically remove old, damaged, or outdated notes from circulation,
• These notes are supposed to be counted, verified, logged, and destroyed (burned or shredded),
• Insiders could falsely record that the currency was destroyed, while actually diverting the physical notes.

2. Collusion Among Officials

This kind of fraud requires multiple layers of insider cooperation.

3. Laundering the “Destroyed” Money

The stolen, undeclared cash could then be laundered

PREVENTION

• Central Bank Controls,
• Serial number tracking of notes meant to be destroyed,
• CCTV surveillance and biometric access to high-security cash destruction zones.
• Random third-party inspections during destruction,
• Use of automated machines that count and shred notes without human contact,
• Auditing and Transparency,
• Real-time logging and cross-verification by independent departments,
• Forensic tracking of serial-number batches after destruction,
• Audit trails retained for a mandatory period, often years.

Real-World Examples (or Similar Cases)

• Some bank officers were caught trying to launder old currency meant to be surrendered and destroyed,
• Allegations arose of old bills being recirculated or exchanged on the black market.
• cases were reported of cash meant for destruction re-entering circulation via insider collusion.

Read More : 

Detecting Fraud in Banking and Financial Institutions

Private Placement Business Scam 

#BankFraudAwareness, #CustomerProtection, #FinancialIntegrity, #InsiderThreat, #TrustInBanking

Kursus Pencegahan Risiko Penggubahan Wang Haram serta Pembiayaan Keganasan dan Pengurusan Dana Awam

Kursus Pencegahan Risiko Penggubahan Wang Haram serta Pembiayaan Keganasan dan Pengurusan Dana Awam

Jaringan Kerjasama Jabatan Pendaftaran Pertubuhan Malaysia, Bank Negara Malaysia dan Suruhanjaya Pencegahan Rasuah Malaysia

Ianya dihadiri oleh lebih 300 orang peserta dari NPO/NGO, Koperasi, Yayasan, kakitangan-kakitangan SPRM dan BNM dll.

Penghargaan saya kepada Presiden dan Pengasas Pertubuhan Wanita dalam Urustadbir dan Teknologi Malaysia (WIGTA), Puan Tetty Henney binti Zulkifli

INSURANCE REPORTING PROCEDURE? (Malaysia)

Disclaimer : This brief article represents solely my personal research findings. I do not act as a representative of any mentioned party. The views expressed are strictly my own and do not represent those of the parties referenced herein. Additionally, I may not be updated with the latest insurance reporting procedures. Your input to rectify any inaccuracies in my research is greatly appreciated.

The Anti-Money Laundering, Anti-Terrorism and Proceeds of Unlawful Activities Act 2001 (“the Act”) came into force on 15.1.2001 is aimed at thwarting money laundering, terrorism financing, and the utilization of illicit funds. Reporting entities are mandated to disclose any dubious circumstances, as outlined in the Act, along with sector-specific directives or rules set forth by the Bank Negara Malaysia.

I am more interested to touch on Insurance Sector and how reporting is done.

Insurance fraud entails engaging in deceptive actions to achieve illegitimate gains within an insurance procedure. It happens when either the insurer or the claimant seeks to acquire benefits they are not rightfully entitled to, or when an insurer deliberately withholds benefits rightfully owed. 

Fraud like these adversely affects policyholders, resulting in millions of ringgits lost through elevated premiums and inflated prices for goods and services. Pinpointing the precise cost of insurance fraud proves challenging as a significant portion of instances remain undisclosed.

Examples of insurance fraud that may involve the claimant and/or be known to insurer officials include:

a. Fabricating Claims - Orchestrating staged accidents, such as fake "oil spillage" incidents or chain collisions, to gain possession of the vehicle(s) for repairs.

b. Exaggerating Loss Amounts - Submitting inflated claims where the severity of damage or injuries sustained in a legitimate accident is overstated.

c. Providing False Information for Compensation - Presenting inflated or "padded" claims where the extent of damage or injuries sustained in a genuine accident is misrepresented.

Quoting 14A. (1) of Anti-Money Laundering, Anti-Terrorism, Financing and Proceeds of Unlawful Activities Act (AMLATFPUA) 2001 :

Any person who knows or has reason to suspect that a reporting institution is proposing to report, is reporting or has lodged a report under section 14 or is proposing to provide, is providing or has provided any other related information to the competent authority and discloses such knowledge, suspicion or information to any other person commits an offence and shall on conviction be liable to a fine not exceeding three million ringgit or to imprisonment for a term not exceeding five years or to both.

In this context :

•            Any person        : claimant/insurer officials,

•            Reporting Institution: Insurance Company,

•            Competent Authority: Persatuan Insurans Am Malaysia (PIAM)

The competent authority duly authorized by BNM for reporting fraud is Persatuan Insurans Am Malaysia (PIAM).

However, I noticed some limitations:

Possible ambiguity regarding whether compliance officials (or a member of general public) can utilize the same form (FRCF) to report against another officials - if so, will it reach BNM or any other authority (will such insurance compliance official be protected under the Witness Protection Act 2009 (Act 696),

The general reporting period allocated is six (6) months but clarity is potentially lacking on other types of cases,

Unresolved issues can be reported to either the Ombudsman for Financial Services (OFS) or BNM. 

Nevertheless, there appear to be limitations on BNM side in handling complaints of misconduct, which may not be consistent with Section 14 (A) of AMLATFPUA.

The reporting procedure by other institutions such as Banking and Financial Institutions are generally clear, but there appear to be "some exceptions" regarding reporting insurance incidents, which I consider vague, especially concerning officials reporting misconduct against another official.

If these are valid concerns - there's a need for improvement to ensure that there are no restrictions on disclosing reports directly to Bank Negara Malaysia, aside from PIAM or OFS.

GLOBAL FORUM ON ISLAMIC ECONOMICS AND FINANCE

Officiated by YAB Dato’ Seri Anwar bin Ibrahim, The Prime Minister of Malaysia - who also deliver a speech on Global Islamic Economy: A Reform Agenda for Shared Prosperity

Would like to thank the organizer Bank Negara Malaysia in collaboration with the Securities Commission Malaysia, Labuan Financial Services Authority, the IILM - International Islamic Liquidity Management Corporation, the Islamic Development Bank (IsDB), the Islamic Financial Services Board (IFSB) and the The World Bank Group - for having us who are representing the grassroots, community and small people hoping to get some briefing from us after the event.

(Personal Note : also would like to thank many colleagues who have been great supporters to me as well)

Themed ‘Shaping a Resilient Global Islamic Economy Through Values-based Reforms’, #GFIEF gathers policymakers, business leaders, and financial service providers from all around the world to engage in discussion and collaborate to build a future where Islamic economics and finance can play a pivotal role in fostering shared prosperity and equity.

Encountered distinguished figures such as Datuk Abdul Rasheed Ghaffour, the Governor of Bank Negara Malaysia, who delivered the keynote remark, alongside esteemed individuals like Tan Sri Nor Mohamed bin Yakcop, Tan Sri DS Wahid Omar, and senior corporate leader Tan Sri Dato' Azman Mokhtar and many others. Also in attendance were Yang Mulia Ungku Tan Sri Dr. Zeti Akhtar binti Ungku Abdul Aziz (Dinner), YBM Senator DS Utama Tengku Zafrul Aziz, Dato' Seri Dr. Awang Adek Hussin, and numerous others. Among the honored guests was Her Excellency Sri Mulyani Indrawati, the Minister of Finance from #Indonesia.

It was a remarkable opportunity to engage with eminent Islamic scholars and guest speakers, delving into comprehensive discussions and analyses of various aspects of Islamic Economics and Finance. Among others are Dame Susan Rice and Dr. Giath Sabsigh. Also met Tan Sri Andrew Sheng and many others.

Attending the exhibition was always a highlight for us, offering valuable connections with diverse banking and financial institutions.

(Interestingly, I met the son of my esteemed cousin, who is employed in the field - well it runs in the family - can't mention names due to privacy)

Malaysia can now proudly proclaim as the leader in Islamic Economy and Finance, (apart from Halal products/Islamic Banking) Most important to us is the emphasis placed by everyone on addressing the crucial issue of bridging the gap between the affluent and the underprivileged.

Key themes that resonated with me included Maqasid Shariah, Sukuk, Equity, Inclusivity, Advancements in Islamic versus Conventional Economics and Finance, Bursa Malaysia and emerging Shariah-compliant exchanges, Zakat and Waqf, Islamic Financial Standards, Guidelines, Policies, White Papers, Utilization of AI, and Islamic Payment Gateways, among others.

WOMEN IN GOVERNANCE AND TECHNOLOGY ASSOCIATION MALAYSIA (WIGTA) STAND ON ILLEGAL ACTIVITIES

 Reshared :

Press "cc" to see the translated captions - WIGTA's stand on illegal activities. Pendirian WIGTA mengenai aktiviti haram.

ALERT DON'T FALL FOR UNLICENSED INVESTMENT - A REMINDER BY NIK ZAFRI

Many individuals remain unaware of the necessity for proper licensing from regulatory bodies when engaging in trading activities related to finance, funds, shares, derivatives, and precious metals. Both individuals and the companies they operate must obtain appropriate licenses.

For detailed information, please consult the Capital Markets and Services Act 2007 (CMSA) administered by the Securities Commission. Further reference can also be made to The Banking and Financial Institutions Act, 1989 or Companies Act 1965.

In the case of Gold, Bullion, or FOREX trading, refer to the Exchange Control Act 1953 (ECA 1953), which falls under the direct jurisdiction of Bank Negara Malaysia.

It is crucial to stay informed about these regulations to prevent direct or indirect involvement in illicit activities such as money laundering (The Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 - AMLA) or even bribery (Malaysian Anti-Corruption Commission Act 2009).

Avoid seeking loopholes in these regulations. Exercise caution and skepticism, especially when confronted with photos, screenshots of bank accounts, Get Rich Quick Schemes, unlicensed Multi-Level Marketing/Pyramid Schemes, or any other dubious schemes.

Despite current challenges, refrain from adding unnecessary burdens that may lead to suffering for yourself and your loved ones. Stay vigilant and adhere to regulatory guidelines to ensure a secure and lawful financial environment.

ANTI-MONEY LAUNDERING, ANTI TERRORISM AND PROCEEDS OF UNLAWFUL ACTIVITIES ACT 2001 - MY THOUGHT FOR THE DAY

The Malaysian Anti-Money Laundering, Anti-Terrorism and Proceeds of Unlawful Activities Act 2001 is clear in terms of enforcement, reporting institutions and entities, detecting of red flags, sanctions, seizures, etc.

However, there is a possibility of overlapping of duties between several agencies, leaving the general public unclear about "who can do what." This includes Bank Negara Malaysia, Security Commission, Company Commission of Malaysia, Malaysian Anti-Corruption Agency, Royal Military Police, and Special Forces. It's important to sort out these duties to ensure transparency and clarity in the system.

Other potential shortcomings include different reporting periods, accessing databases, listing and global sharing of information. I hope to see improvements in the near future.

PART 3 - ANTI-BRIBERY MANAGEMENT SYSTEM - by Nik Zafri

1. Context of the Organization

Most of the contents are almost similar to any other quality, safety and environmental certification standards. With exceptional the use of "Anti Bribery Management System (ABMS)" in lieu of QMS, OHSMS and EMS.

It's important to identify and customize ABMS to the overall business nature of the organization be it internal or external. Not everything may apply to the organization practicing ABMS but to link most of the elements to the core processes would be an added advantage. 

Most important, all activities and relevant documented information to also take into account applicable statutory, regulatory, contractual and professional obligations and duties. 

2. Stakeholders

In this sense, not limited to the following, stakeholders could be :

a) Board of Directors (BOD) or equivalent - in this sense, directors that possess a certain portion of shares and with executive authorities to execute their duties and responsibilities to ensure that resources are provided to ensure the success of ABMS. They must also have a fair knowledge of the relevant regulations and ABMS.

b) Management Representative (MR) - although most of the latest revision of the standards may have ommitted "MR", it's still required to have one either a member of the BOD or a member of the organization who possess sufficient experience, qualifications and competency to become the "watchdog" of the system. 

c) Non-Executive Directors or equivalent - this would apply to advisors; despite limited to making recommendations; they should also be fully aware of applicable regulations and ABMS

d) Representatives from Service Providers - namely Consultants, Contractors and Suppliers/Vendors - they are also involved in ABMS and is bound to ethics and requirements of the ABMS procurement contract and procedures, 

e) Investors - for public and public listed companies, the prospectus, annual reports or magazines (online and offline) or press conferences should highlight the initiatives taken by the organization and how investors can play their roles in ABMS,

e) Representatives from the general public or people from the surrounding areas of operation. It's also a good practice to involve relevant NGOs as well.

f) Authorities - involving Anti-Corruption Commission, Corporate Governance, Company Laws, Security Commission, Anti-Money Laundering, Central Bank and the finances and banks as well. Communications should be well-established with these entities.

It is important to note that "whistleblowers" MUST be protected at all times.

3. Scope

"Scope" is relevant to the nature of business of the organization taking into account internal and external issues and risk assessment. Documented information to determine and clarify the scope should be included in the ABMS Manual of the Organization.

4. Anti-Bribery Management System (ABMS)

Again, the keywords :

i)  Establish

ii) Document

iii) Implement

iv) Maintain

v)  Review

vi) Improve

are included in ABMS to manage documented information (document, data and records) just like any other certification standards.

Most important - whether it's a Policy, or Manual or Plan, or Procedures (Administrative and Operation) or Work Instruction or Method Statement or Inspection and Test Plan (even checklists) - a clear and thorough process flow (typical 4 columns - no., process, person in charge (PIC) and relevant documented information - should be included and related to the documented information. These documented information should take into account ABMS standard, relevant regulations and where applicable contractual requirements.

The documented information should also contain measures designed to identify and evaluate the risk of, and to prevent, detect and respond to, bribery.

Despite to eliminate risk of bribery is almost impossible, it is advisable to have a target set for every cut-off period of implementation.

5. Risk Assessment 

a) Identify the bribery risks - proactively if necessary (based on past experience) or as per recommendation from external party,

b) New and unexpected risks could be identified as the implementation goes - analyze (data analysis), assess and prioritize (e.g. the typical Red, Yellow, Green coloured bands - with justifications)

c) Identify proactive mitigation or new mitigation for unexpected risks found during assessment,

d) Be reviewed (usually in the Management Review Meeting)

e) Be susceptible to change in the country laws/legislations or the standard or any other guidelines from the relevant parties.

Should there be a repetitive trends, then it is important to look back at the risks been identified during the commencement of the system (ABMS)