If someone offered you 1% return every month, is this a scam?

If someone offered you 1% return every month, is this a scam?

How many friends whom we know were scammed by some high return investment schemes? Sometimes, it could be 20 percent as soon as we invest, sometimes it could be 5 percent every month, sometimes it could be even higher. The below is a case of a return of 40 percent within 24 hours.

Article in nst.com.my: A 77-year-old retiree has lost nearly half a million ringgit after falling victim to an online investment scam promising instant returns of up to 40 per cent within 24 hours.

District police chief Assistant Commissioner Tan Seng Lee said the victim was enticed by a syndicate claiming that profits would be credited into an application he was instructed to download.

Drawn in by the promise of high returns, the retiree made 12 transactions totalling RM473,000 into three bank accounts between Sept 16 and Oct 18.

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Tan said the victim had checked the apps, which showed an absurd ‘profit’ of RM2.63 billion. However, when he attempted to withdraw the funds, his account was blocked. Article in nst.com.my:

#1 Scam Signal – No one knows what business they are doing

Any investment at all must be due to some business. When it comes to a business, then there’s no way returns could be daily, weekly or even monthly. Except if the business is selling food by the roadside, there are no way any shop could declare profits on a daily basis/ weekly / monthly basis in order to give returns to their investors. It’s at least quarterly, if it’s a public listed company for example. So, first question is to ask the one approaching us on what is the business which they are doing. Ask how they earn their money in order to give us the returns.

#2 Scam Signal – Returns are very high

Fixed Deposit (FD) rate from the banks could be 3.5 percent. As soon as anyone offering something which is double or higher, chances are it is a scam. If any bank in Malaysia knows of any scheme offering them 7 percent or higher for example, the banks would immediately dump a huge portion of their savings into this scheme yeah. It’s such an easy deal for them yeah. They get 7 percent using YOUR money and they pay you 3.5 percent and they get 3.5 percent in quick returns…

So, do we believe there are still opportunity for us to invest? The banks would have subscribed for everything which is on offer yeah. Then, banks could advertise they are offering a special 4 percent FD rate… Therefore, even if it’s 1 percent per month, it’s already 12 percent per year which is many times above the FD rate. So a good question would be to ask the person approaching us whether any bank has also invested or not. Ask for proof…

#3 – Scam Signal – Usually it’s a QUICK return or a LIMITED offer

We have final 5 slots. Quickly grab it before it closes. You invest today, the returns will start tomorrow / next week etc. This is ONLY limited to selected individuals. You are lucky that you know about it. If you do not invest, you will lose this opportunity and you will then have to invest into low return instruments. So many people have profited from it within the past week.

The only reason why such opportunities exist is to scam you. They want you to quickly decide and therefore did not have the time to consult friends who could have told you it is a scam.

How to avoid being scammed?

Read more. Sometimes, the scammers would use love as a theme and not just greed. Someone whom you met online or even in person could suddenly fall in love with you and shower you with some gifts and suddenly they will face financial troubles and will need you to help them. If you do not help them, they will lose a lot of business and then may not think of getting married anymore. Sigh… Old tricks but still many people are scammed this way.

All I can do is to keep repeating this message and telling people that ‘Love at First Sight’ could happen but one must still use all the senses to know if it’s true love or love scams. Tell friends and chances are they could warn us too. If the person truly loves you, the person would understand that you are doing checks to protect yourself. They would understand. If they do not, chances are something is brewing and you are the potential victim.

Please stay safe.

Happy choosing. 

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