There is a wide range of products and schemes, both in Singapore and globally, that claim to offer consumers potential profits. Some of these are offered and traded in markets or by firms that are regulated. But, there are others that are not regulated by financial sector regulators like MAS.
Deal with regulated persons if you are seeking financial services
Consumers seeking financial services are strongly encouraged to deal only with persons that are regulated by MAS. MAS' regulatory regime aims at safeguarding the interests of consumers by ensuring that only competent and professional persons may provide financial services. The laws administered by MAS also require disclosure of information on investment products being recommended to consumers.
Click here to find out what you can do to check if the party you intend to deal with is authorised by MAS.
Pitfalls of dealing with unregulated entities or schemes
If a consumer chooses to participate in schemes that are not regulated by MAS, he will not have the protection afforded under the regulatory framework administered by MAS, particularly if the operators are based overseas. If he has a complaint against an unregulated entity, he will also not be able to approach the Financial Industry Disputes Resolution Centre (FIDReC) for assistance. And if an operator is based overseas, it could be even harder for the consumer to pursue the matter.
It is very important that consumers check the legitimacy of such schemes, rather than just focusing on the offered returns, particularly where the scheme promises returns are much higher than the returns offered by established investment schemes/products regulated by MAS. If something is too good to be true, it probably is.
When consumers put their money into such unregulated schemes, they do so at their own risk.
Read more in the consumer alerts below:
Common unregulated schemes
Below are weblinks to information on some unregulated schemes and key risks consumers should watch for. This list is not exhaustive. It is updated from time to time, based on information received by MAS.
You may have heard of virtual currencies. If you are wondering what they are and how they work, read this article to find out the features and risks involved in virtual currency schemes.
Investing in tree and crop plots
See the wood for the trees when investing overseas
Received an offer to invest in trees, crop plots or plantations? Consider carefully before deciding whether to place your money in these schemes. Click here to read an article by the United Kingdom Financial Services Authority.
Forex Trading classes / software
Enrichment classes: Gain a new skill, enjoy new riches? Think again!
These days, newspapers carry ads for forex trading seminars regularly, often daily. The success stories are catchy: the chance to retire early, earn extra income or make some money after years as a home-maker are appealing. But media reports have carried mixed views about these seminars. Some consumers have also lost money on top of paying out hefty course fees. Click here to learn more about what forex trading is about and key things to think about before parting with your money.
Look before you leap – pitfalls of dealing with unregulated entities
We sometimes come across seminars or schemes that claim to offer high returns, at low risks. These look very attractive. But what are the risks? Click here to listen to a Mandarin radio programme, aired on Capital 95.8 FM on 17 May 2012.
Gold “buy-back” offers