Malaysia Warns of 74% Rise in Crypto Investment Fraud

Malaysian authorities have issued a stern warning about the increasing prevalence of cryptocurrency investment fraud, emphasizing the need for heightened vigilance among potential investors. The authorities have noted a significant rise in reports of individuals being deceived into investing in fraudulent crypto schemes, often through advanced social engineering tactics. These scams frequently involve convincing victims to transfer funds into crypto accounts or wallets, where the funds appear to be present but are ultimately inaccessible.

The warning is part of a broader initiative to educate the public about the risks associated with cryptocurrency investments. Authorities have stressed the importance of due diligence and caution when considering any investment opportunity, particularly in the volatile and unregulated crypto market. They have advised potential investors to be wary of unsolicited offers, promises of guaranteed returns, and requests for personal information or funds.

The rise in crypto investment fraud is not an isolated issue in Malaysia. Similar trends have been observed in other regions, where scammers exploit the lack of regulation and the anonymity offered by cryptocurrencies to defraud investors. The authorities have urged the public to report any suspicious activities or potential scams to the relevant authorities, highlighting the importance of collective efforts in combating this growing threat.

In response to the warning, financial experts have advised investors to educate themselves about the risks and potential pitfalls of cryptocurrency investments. They have recommended conducting thorough research, seeking professional advice, and only investing funds that individuals can afford to lose. Additionally, experts have suggested using reputable platforms and services for crypto transactions to minimize the risk of falling victim to fraud.

The authorities' warning serves as a timely reminder of the need for caution in the crypto investment landscape. As the popularity of cryptocurrencies continues to grow, so too does the risk of fraud and deception. By staying informed and vigilant, investors can protect themselves from falling prey to these scams and safeguard their financial well-being.

Bukit Aman Commercial Crime Investigation Department Director Datuk Seri Ramli Mohamed Yoosuf highlighted a recent case where a 74-year-old individual lost tens of millions of ringgit after falling for a scam. Some victims believe that purchasing multiple cryptocurrency coins, each worth hundreds of thousands of ringgit, will guarantee big profits. However, in reality, “no investment is made, it’s purely a scam.”

Beyond crypto fraud, phone scams remain another major concern. Crypto scammers often impersonate trusted authorities, whether it’s financial regulators, banks, or even law enforcement, to trick victims into handing over their money. Ramli warned locals to be wary of fraudulent calls impersonating authorities, stressing that legitimate agencies do not operate through multi-step phone calls that bounce between different departments.

“There’s no such thing as a call that starts with a courier company, then connects to the police, the bank, and the audit department—all in one conversation,” he said. Ramli attributed the surge in scams to rapid technological advancements, making fraud schemes more sophisticated. Scammers have been increasingly leveraging AI-based tools and deepfake technology to make their schemes more convincing by often impersonating authorities or legitimate projects. Experts have warned that this trend is likely to continue.

Malaysian authorities are also turning to AI and blockchain technology to combat financial crimes, using these tools to enhance fraud detection and track illicit transactions more effectively. “As law-abiding citizens, do not be afraid and don’t fall for these scams, you could end up losing millions,” Ramli said, adding that many scam operations are run from luxury condominiums in densely populated areas.

Despite the growing threat, authorities have made some progress in tackling the issue, with the JSJK carrying out 23,000 arrests linked to scam syndicates last year—a figure Ramli described as a “significant achievement.”