Agents Scam EPF Members

RISING cost of living, difficulty in getting loans and ignorance on the terms and conditions of withdrawal are among reasons Employees Provident Fund (EPF) contributors are duped into withdrawing their savings.

Malaysian Muslim Consumer Association chief activist Nadzim Johan said some contributors were willing to cooperate with syndicates or fraudulent agents to withdraw EPF savings by providing false documents for quick cash.

He said some contributors collaborated with housing developer companies and real estate agents to withdraw their savings despite being aware this was an offence.

Sharing his encounter with victims who have been duped by the syndicates, Nadzim said some victims admitted they went through tremendous pressure after dealing with the syndicates because they felt guilty they had cheated and were also swindled of their savings.
 
He said although the number of complaints was still low, the issue of contributors collaborating with syndicates should be addressed and stopped immediately.

He said victims were charged exorbitant service fees of 10-40% of the withdrawal amount but some did not receive a sen.

Meanwhile, National Council of Professors Economic and Management Cluster committee member Prof Dr Mustafa Mohd Hanefah said lack of financial planning and uncontrolled use of credit cards made it easy for opportunists to take advantage of potential victims. 

The Universiti Sains Islam Malaysia (USIM) faculty of Economics and Muamalat lecturer said such a situation had led contributors to borrow money from certain syndicates to settle their debts before they became indebted to the syndicates.

He said the same modus operandi was being used to get students from higher education institutions, especially from middle-income families to persuade their parents to withdraw their savings from Account 2 for the purpose of financing their studies.

EPF has lodged police reports on 312 fraudulent withdrawals involving contributors and two private higher education institutions which had conspired in fraudulent withdrawals with the pretext of conducting study courses at the institution. 

EPF advised contributors not to be deceived by syndicates which used the EPF logo to advertise their services to convince and dupe the public into making use of the Account 2 withdrawal facility through the social media, 

In cautioning the public to be vigilant over such advertisements, EPF reminded it had not endorsed any party to facilitate members’ application for withdrawals and members who met with the criteria should deal with EPF directly.

According to press reports, 85 fraudulent withdrawal cases were recorded by EPF in 2015, 152 cases last year and up to June this year there were 63 cases. 

Fraudulent withdrawals, which involve the submission of falsified documents by members to facilitate the approval of EPF withdrawals, is an offence under EPF Act 1991.

Members found guilty are liable to a maximum jail sentence of three years or a fine of RM10,000, or both.