Malaysia’s Crackdown on Crypto Crime: A Detailed Analysis of Recent Developments

Table of Contents

Main Points:

  • Malaysia Police dismantles a crypto investment scam call center targeting Japanese citizens.
  • The scam center operated for only a month, using luxury bungalows as its base.
  • 21 individuals arrested, including Malaysians, Chinese, and others.
  • Tactics included using social media platforms to lure victims and directing them to invest through specific apps.
  • The investigation also revealed the use of social visit passes for the syndicate’s operations.
  • Authorities seized computers, mobile phones, and other equipment during the raid.
  • The crackdown also uncovered illegal crypto mining operations causing massive power theft in Malaysia.
  • The Malaysian government is also taking action against unregistered crypto exchanges.

1. Malaysia’s Crypto Scam Crackdown: A Swift but Decisive Action

The Malaysian Royal Police (PDRM) recently made headlines by dismantling a crypto investment scam call center in Kuala Lumpur that specifically targeted Japanese citizens. The operation, which took place on the 19th of the month, followed forced searches of two luxury residences in the city. This swift action resulted in the arrest of 21 individuals, including Malaysians, Chinese nationals, Laotians, and others. The call center had been operational for just a month, strategically using well-guarded luxury bungalows far from main roads to avoid detection.

2. How the Scam Worked: Sophisticated Tactics to Target Victims

The syndicate behind the scam employed sophisticated tactics to lure victims. Using social media platforms like Tinder and Monster, they enticed individuals into investing in cryptocurrencies through popular apps such as Bitbank and Coincheck. Once the victims were hooked, the syndicate members, who had entered Malaysia using social visit passes, would charge a 20% commission on the defrauded amounts. The operation was highly organized, with foreign nationals handling customer service roles while a local Malaysian managed the call center.

3. Seizure and Arrests: A Haul of Digital Evidence

During the raid, the Malaysian police seized a significant amount of digital evidence, including 17 computer systems, 55 mobile phones, routers, keys, and alarm units. These tools were integral to the syndicate’s operations, helping them maintain a semblance of legitimacy while carrying out their fraudulent activities. Of the 21 individuals arrested, one Malaysian suspect was released on bail, while the remaining 20 are still in custody under the Immigration Act of 1959/63.

4. Legal Proceedings and International Implications

The arrested individuals are being investigated under Section 420 of the Penal Code, which deals with fraud and deceit. This case has broader implications, as it highlights the growing trend of international crime syndicates using sophisticated methods to target unsuspecting victims across borders. The involvement of multiple nationalities in this operation underscores the need for international cooperation in combating crypto-related crimes.

5. Beyond Scams: Malaysia’s Battle Against Illegal Crypto Mining

In a related but separate incident, six Malaysians were charged with kidnapping a Chinese national and demanding a ransom of 1 million USDT (Tether). This case, while distinct, is part of a broader trend of crypto-related crimes in Malaysia. The country has also been grappling with illegal crypto mining activities that have led to massive power thefts. The Deputy Minister of Energy Transition and Water Resources, Akmal Nasrullah Mohamad Nasir, revealed that these illegal operations had caused an estimated loss of $723 million between 2018 and 2023.

6. The Broader Regulatory Crackdown

Malaysia’s efforts to clamp down on illegal crypto activities extend beyond scams and mining. The Securities Commission of Malaysia has been actively taking action against unregistered crypto exchanges. In May 2023, it ordered Huobi Global to cease operations in the country for failing to register its trading services. Currently, only a handful of exchanges, including HATA Digital, Luno, Synergy, MX Global, Tokenize Technology, and TRAM International, are officially registered to operate in Malaysia.

7. A Strong Message to Crypto Criminals

Malaysia’s recent actions against crypto-related crimes send a strong message to both local and international criminals. The dismantling of the crypto investment scam call center and the crackdown on illegal mining and unregistered exchanges demonstrate the country’s commitment to cleaning up its crypto industry. As the global crypto market continues to grow, such measures are crucial in ensuring that it develops in a safe and regulated manner, protecting investors and maintaining financial stability.

Search

About Us and Media

Blockchain and cryptocurrency media covering and exposing the practical application development on the blockchain industry and undiscovered coins.

Featured

Recent Posts

Weekly Tutorial

Sign up for our Newsletter

Click edit button to change this text. Lorem ipsum dolor sit amet, consectetur adipiscing elit