MGSB Investment Scheme

More than 200 individuals claimed they were cheated of their life savings amounting to over RM12 million from business-related scams by a company since early this year. The victims said the company, MGSB Bhd, had offered them a dividend of between 18% and 20% a month when they entered into a joint business venture set up by the company and involved in various schemes.

The schemes were the export of coconuts to neighbouring countries, a resort development project on an Indonesian island off West Sumatra, as well as investment in a company to be public-listed in Indonesia.

In a report lodged with Bank Negara Malaysia (BNM), the victims alleged they were persuaded to part with their funds by the director, whom they claim played up the sentiment of “wealth sharing among the Malay community”.

“He said that he was a shariah lawyer and that he would not be involved in any illegal business,” a few of the victims told reporters outside BNM today. They added that they felt something was amiss when MGSB started delaying their payments around March this year.

“We only realised we were cheated after BNM issued a statement in September, saying that the central bank had raided MGSB, confiscated their documents and frozen all the bank accounts for allegedly breaching financial services and anti-money laundering laws,” they said.

One of the victims, Nazir Husin, said he had invested RM30,000 of his savings in the Indonesian island resort development scheme.

“My brother told me he had made money from the coconuts export business,” he said, adding that his brother’s testimonies had drawn him to the company’s scheme which offered high return rates.

Another victim from Ulu Tiram in Johor, Musa Mydin, said he knew of MGSB and its business schemes through word of mouth.

“The advertisement on the Pulau Sirandah resort (in Indonesia) was very persuasive and I invested RM20,000.

“Only God knows if we can ever get back our money one day,” Musa said, adding that the RM20,000 would be better put to use for his children’s school expenditure.

The victims’ lawyer, Faizal Abd Rahman, after lodging the complaint with BNM, said they told BNM officials that they wanted their money back.

“The central bank told us MGSB is still under investigation and thanked us for coming forward to surrender the relevant documents,” he said.

Only a small number of the 260 victims accompanied Faizal to file the report with BNM.