It is always sad to read about investors losing their life savings and sometimes even taking their own lives as a result of unbearable losses to unregulated investment schemes (Unregulated investment schemes on the rise in S'pore, Nov 10).
Over the last three years, I have written dozens of letters to the Monetary Authority of Singapore about dodgy marketing companies peddling their products openly in lavish hotel seminars, only to be told these companies are already on the Investor Alert List, so it is "buyer beware".
Then, I write dozens of letters to the Commercial Affairs Department (CAD), giving it ample material to counter the spurious marketing claims by those companies, only to be told it is a "victimless crime" as no one has yet reported a loss.
Over time, as victims begin reporting defaults and potential fraud, the investigators reply with "still under investigation" - even 24 months after the first reported loss.
Scammers take advantage of this slow pace of investigation to maximise their negative "largesse" and by the time these schemes are ended, many lives would have been destroyed and many millions of dollars lost.
I have no complaints against our financial authority or law enforcement but a change in approach is needed if we want to stem this scourge of scammers taking advantage of an innocent, unsophisticated investor pool.
Our approach so far has been passive education and caution. Let us set up an aggressive undercover scam-buster unit within law enforcement, comprising paid or voluntary business consultants and financial journalists who actively research and evaluate those marketing schemes.
A few in-depth and intelligent questions about the impossibility of a vendor's business model or its promised claims in front of hundreds of potential investors can give sufficient pause to victims being separated from their money.
Just as good publicity helps scammers to perpetuate their diabolical deeds, bad publicity will put them out of business or, at the very least, slow them down.
Lee Seong Wee
