Internet Scam Goes To Court

Internet Scam Goes To Court

March 22, 2016 Scams 0

RM65mil cyber fund case the first in Malaysia

KUALA LUMPUR: A 47-year-old “cyber fund manager” who has been operating without a licence became the country’s first man to be charged in a court for an Internet investment scam involving RM65mil.  

Phazaluddin Abu, who is also a general manager of a computer company, claimed trial to the charge. 

He was said to have held himself out as a fund manager, through the Internet website www.danafutures.com, without holding a fund manager’s licence.  

Phazaluddin is accused of committing the offence at Affiliate Shoppers Network at No.14 first floor of Jalan Opera C in Shah Alam between Jan 3 and June 22 last year. 

If convicted, he can be fined a maximum of RM1mil or jailed up to 10 years under Section 15C of the Securities Industry Act 1983. 

Lead prosecutor Syed Mohd Naqib Syed Taha, from Securities Commission (SC), asked the court to deny bail saying that the offence was non-bailable and that the offence was related to an Internet scam where the accused managed investment portfolios.  

Syed Mohd Naqib said that more than 100 Malaysians had invested RM65mil over a period of three months. 

“The website offered investments of between US$25 and US$1000 (RM80 and RM3,194) for 100 days, with daily interest returns from 2.2% to 3.15% (for each investor),” he told Sessions Court judge S.M. Komathy Suppiah. (The website was shut down on June 22 last year.) 

He said Phazaluddin had run the scheme without a licence from the SC and that the prosecution was concerned about investors going after him.  

Syed Mohd Naqib, who called on the court to set bail at RM500,000 if it decides to grant Phazaluddin bail, said the accused could also leave the country as his first wife and daughter were living in India. 

He said also the accused would probably be charged for money laundering next week. 

Prosecuting officer Charandeep Kaur said the SC had recovered evidence of all account holders from the accused’s premises, which indicated the total investment amount.  

Defence counsel J. Chandra asked the court to set his bail at RM10,000 saying that it would be prejudicial for the prosecution to argue over potential charges to be preferred on his client. 

When queried by the judge about his family, Chandra said the accused also has a wife and two children in Malaysia. 

Komathy set bail at RM200,000 in one surety and ordered him to surrender his passport to the court. 

The judge fixed five days from Nov 3 for his trial after the prosecution told her that they would be calling between 20 and 30 witnesses.  

Source: Article by M.Mageswari from the Star Online, 1 March 2008