Here’s How To Spot Investment Opportunities Scam

Here’s How To Spot Investment Opportunities Scam

Earlier this year, a government retiree lost RM542,171.20 of their retirement money in an investment opportunity scam. Last month, another civil servant pensioner lost more than RM4.4 million in a similar type of scam.

In fact, the Deputy Finance Minister, Datuk Seri Ahmad Maslan issued a warning in April this year, saying that in 2022, 22,000 people had lost more than RM850 million.

Which is why today in this article, we’re going to share the telltale signs of an investment scam, and what to look for instead.

What to avoid

Investments that are too good to be true

While speaking about the number of people falling victim to investment scams, Datuk Seri Ahmad Maslan had this piece of advice, “do not be duped as whatever that is too good to be true is usually not true.”

And the truth is, this is definitely the number one advice you’re going to get if you ask the authorities, experts, and anyone with experience dealing with investment scams.

Because it is true. If an investment promises you the stars and the moon for little to nothing, chances are that it’s not true.

Money back guarantees and unrealistically high returns are usually a huge red flag, so when you see any investment opportunities that offer you something like this, it’s better to run the other way.

Most experienced investors look for 10% returns annually for high to medium risk investments, so that is a good benchmark for you to set your sights on. Lower risks tend to fall around 4% instead.

Whatever you choose, notice that the returns are annual (per year). Anything that promises those amounts each month is a red flag.

What to look for instead

Instead, when looking for an investment opportunity, try to look for one that offers you a much more grounded expectation of what to come. 

One rule you should always keep in mind is that there are no guarantees in investing, so don’t waste your time looking for one.

When it comes to returns on investments, look for something that fits your risk profile. If you’re investing for long term goals, something that is slow and steady should fit your best. 

For example, Bumiputra Malaysians can try out ASNB, which recorded a return of 5.1% earlier this year.

It might be tempting to find the next jackpot, but incessantly looking for jackpots can leave you at risk of being scammed.

What to avoid

Hard sells

Another aspect of investment opportunities you should look out for is when they include elements of hard selling in their sales pitch.

Look out for phrases such as “limited time only”, “special rate for first X investors”,  or any other aggressive selling techniques. These are all usually telltale signs of an investment opportunity being nothing but a scam.

Usually, when an investment opportunity presents offers like these, it’s nothing more than a pressure tactic designed to make you commit to rash decisions. 

Of course, some investment schemes that use these hard sells might be a real investment opportunity, but it’s much better to err on the side of caution, and be extra skeptical when you see this.

What to look for instead

Instead, what you should be looking for is an investment opportunity that allows you to make investments at a pace you’re comfortable with.

Remember, investing can be a very monumental decision, so you should treat the decision with care. Take the time to objectively assess the situation and the offer.

Most safe and secure investment opportunities will allow you the time and space to make investing decisions when you like, such as Amanah Saham Nasional Berhad (ASNB).

What to avoid

Unknown and unregulated companies

For a lot of these investment scams, one similarity that all of them have in common with one another is that there is not much information going around about their company. This is another massive red flag.

Combined with the lack of information available on the company, the promoter will also be very reluctant and hesitant to provide you with any additional info.

Which is why another rule of thumb that you should abide by when investing, is never invest with a company that you don’t know. 

Make sure that information about the company is easily accessible before you commit to a decision. An easy way to find information about a company is by looking at their regulations.

While this might risk stating the obvious, a company’s regulatory status is a clear indication of whether said company can be trusted, or otherwise.

Hence, always remember that unregulated companies equals untrustworthy companies.

What to look for instead

Look for investment opportunities from established companies or companies who are fully transparent with their company information or regulated companies.

Always look to invest in regulated companies. In Malaysia, trustworthy companies will always be registered and regulated under two main financial bodies, Bank Negara Malaysia and the Securities Commission of Malaysia.

A lot of information can be gleaned from a company’s information, such as where your invested money will go towards. Which is why companies with readily available information, are companies you can trust.

What to avoid

Unsolicited investment opportunities

If someone suddenly approaches you with an investment opportunity, make sure to do your due diligence and research on the investment opportunity. Most often rather than not, these investment opportunities are nothing more than elaborate scams.

What to look for instead

Instead, you should only look to invest if you’re ready and willing to. Never let anyone persuade or coax you into making investment without doing your homework on it first.

And when you are ready to invest, make sure you invest in trustworthy companies, rather than personal agents or acquaintances.


Investing is a good way to ensure that your money is working for you, instead of you working for your money. But in order to make your investment work, first you need to understand what to avoid.

We hope that with our advice here, you can avoid being part of the statistics, and falling victim towards these unscrupulous scammers who roam looking for prey.

Read More: I Have Been Scammed! Now What?

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