Bestino- Bank Negara must act!

A meeting was held at Buntong on the get rich quick scheme which has affected many people

Speech I made:

In 2006, Bestino Group introduced a special scheme to attract investments.

The investment scheme offered by this investment company was as follows:-

1. An investor would be given a 3 percent guaranteed monthly return on the amount invested with the company.

At same time a quantity of gold would be given as security for the amount so invested. So if RM 10,000 is invested, a RM 10,000 equivalent worth of gold would be given as collateral. 2. If the gold security is returned to the company the guaranteed monthly return on the amount invested is increased from 3percent to 5percent Later, the company was persuasive enough to ask all investors to surrender the gold in favour of an investment certificate from the company.

As the returns were handsome and consistent, the investors readily surrendered the gold bar. In June 2009, Bank Negara and the Securities Commission launched an investigation on the activities of Bestino Group, following numerous complaints received.

The following is an extract of the then news report:-

“ KUALA LUMPUR: Bank Negara Malaysia (BNM) and the Securities Commission (SC) has raided an illegal deposit-taking company that is believed to have raked in hundreds of millions of ringgit involving gold investments and the issuance of redeemable preference shares.
The joint operation saw BNM and SC officers raid Bestino Group Berhad and its related companies in Ipoh and Petaling Jaya yesterday.
The raids were conducted following numerous complaints and inquiries from the public who claimed the company promised a whopping 36% dividend a year or 3% returns per month.
“The SC has ordered the company concerned to immediately cease issuing preference shares or securities of any kind to the public with immediate effect.
“Through a scheme it marketed, Bestino Group claimed to be involved in gold investments and the issuance of redeemable preference shares, promising monthly returns of 3% in dividend payments.
“Bestino Group has failed to seek the SC’s approval for the offering of their preference shares to the public and to register a prospectus with the SC as required under the law,” BNM and SC said in statement. ”

All monies of the company were also frozen. Consequently the monthly payment of guaranteed investment return fizzled out and investors were left high and dry.

Many, who invested, some in millions of ringgit, were caught and unable to comprehend the problem.

An action committee was subsequently formed. The action committee co-coordinator Sdr.Lucus said that the Committee had so far had 13 committee meetings. Among the other members of the committee are Sdr. Bala of Merdaka Garden and Sdri. Saraswarthy from PSM.
Today, the action committee organized a meeting to discuss the investors’ plight and the necessary action plans to best protect their interest.

Over 500 investors attended the meeting held at the Arul Oli Mandram Hall in Buntong, Ipoh.

The meeting lasted for over 2 hours and a number of suggestions from the investors were deliberated and accepted.Among others is that the investors will call over at Bank Negara and the Finance Ministry to get the latest.

Over 6,400 people have invested over RM400 million in the said company.

On my part, I will raise the matter and the investors’ plight in the next sitting of Parliament.