SINGAPORE: A total of 142 reports from consumers who lost S$7.8 million from trading on unlicensed platforms were received by the Commercial Affairs Department (CAD), the white-collar crime unit last year, the police and the Monetary Authority of Singapore (MAS) said on Thursday (May 31).
This was up from 40 reports received in 2016, they said in a joint advisory.
AdvertisementThe two agencies said they had received an increasing number of complaints from members of the public about losses from unregulated online trading platforms over the past year, and warned the public to exercise "extreme caution" when dealing with such platforms.
"These unregulated trading platforms allow investors to trade a wide range of products, such as foreign exchange, shares, commodities and binary options," said the advisory.
Most of these platforms tend to be located outside Singapore, making it harder to verify the credibility of the platform's operations and posing greater fraud risk to consumers, it said.
It is also challenging for investors to pursue claims against operators based overseas.
AdvertisementAdvertisementIn addition, investors are often instructed by operators of such platforms to transfer money to overseas bank accounts which are held in the names of people different from the platform operators, said the advisory.
"This makes it very difficult for investors to recover their monies when things go wrong," it said.
These platforms may also require investors to pay for their trades or fund their trading accounts using credit or debit cards, exposing them to a further risk of unauthorised transactions on their cards.
"There is no regulatory safeguard for investors who choose to transact on unregulated trading platforms," said Mr Lee Boon Ngiap, Assistant Managing Director (Capital Markets), MAS. "There is greater risk of fraud when investors transact on platforms operated by unregulated entities whose backgrounds and operations cannot be easily verified."
He urged consumers to always "ask, check, confirm" before committing to an investment, to avoid potential scams.
“Consumers should always be cautious when they come across an investment opportunity that promises high returns with assurances of little or no risks," said Mr David Chew Siong Tai, CAD director. "These are likely to be a scam; if it sounds too good to be true, it most probably is.”
Anyone with information on fraudulent activities taking place on unlicensed online trading platforms can submit information at I-Witness, or lodge a police report via the Electronic Police Centre at E-Services or at any Neighbourhood Police Centre/Post.
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