Gold bar scheme: 120 fear they may lose $40m

[Musicwhiz]

Sad to read about investors getting conned. 7% to 10% returns per MONTH? Someone should really wake up - that's 84% to 120% per annum - impossible returns to sustain long-term!

The Straits Times
Sep 2, 2011
Gold bar scheme: 120 fear they may lose $40m
Firm under probe after an investor's complaint

By Kimberly Spykerman & Cheryl Ong

A FIRM is at the centre of a police investigation after a customer claimed to have lost $300,000 which was invested in gold bars.

Bao Jing Trading is believed to be having cashflow problems, and there are fears that about 120 investors could lose up to $40 million.

At least two more police reports have been made against the company, based in the Rochor Centre, The Straits Times understands.

But many investors are afraid to approach the authorities for fear the firm will not give them their money back, according to one alleged victim.

Bao Jing - which is not licensed or regulated by the Monetary Authority of Singapore - pitched its gold trading scheme as a way to help customers cash in on the rocketing price of the precious metal, which tends to rise in value during periods of slow economic growth.

Investors were promised monthly returns of between 1.5 per cent and 3 per cent, said a report by Shin Min Daily News. But if they left the bars with the company, they could get between 7 per cent and 10 per cent, the newspaper added.

The customers realised something was wrong when the firm failed to pay the promised returns.

A 70-year-old woman, who wanted to be known only as Madam Yen, told The Straits Times that she had lost more than $200,000 after being introduced to the company by a friend.

She said that when she made a trip to its office, the boss told her he would not give her back the cash if she went to the police. 'I'm heartbroken... this money is more than half my retirement savings,' she said in Mandarin.

In desperation, she and about 20 other investors decided to confront the company's owners on Monday, gathering outside the office's glass doors to ask for their money back. The owners failed to show up and the office has been empty since.

Bao Jing is run by Malaysians Lee Chee Woi, a permanent resident, and Cheong Kok Heng, according to records held by the Accounting and Corporate Regulatory Authority.

Mr Lee registered his company at a local address, in an HDB flat in Jurong East.

But when The Straits Times paid a visit, it turned out to be occupied by a family who denied any links with the firm.

A 38-year-old man in the flat, who wanted to be known only as Mr Pang, said Mr Lee lives in Malaysia but uses his Singapore address to receive mail.

'We're ex-colleagues,' he said. 'All his letters come under my address but I pass them to another colleague of mine who is an acquaintance we both know. I think it's a misunderstanding. All along, his company has been doing well. He won't do this sort of thing.'

Shin Min also reported yesterday that Mr Cheong was once arrested in Malaysia for money-laundering offences.

kimspyke@sph.com.sg

ongyiern@sph.com.sg

[kazukirai]

Sad to read about investors getting conned. 7% to 10% returns per MONTH? Someone should really wake up - that's 84% to 120% per annum - impossible returns to sustain long-term!

Now, I truly believe we're seeing signs of Gold in a bubble. When it bursts is another matter altogether.

[arthur]

Not gg to express any opinions whether gold is indeed in a bubble or not, this issue simply shows the greed of Man continues on since the beginning of the first ape down the tree.

Precious stones n those "my clients, family members, friends who hv a billion $$ in a Swiss acct but need a stranger's acct to trf $$ n in return give him money for free" Nigerian scams have lured in greedy ppl with simple minds too.

Applies to investment too.

[Musicwhiz]

I think the sad part is not about the greed, but in reading about the ignorant losing their hard-earned savings. Like the case of the old woman who lost >$200,000 because she was simply ignorant - those are the saddest victims of all!

[Temperament]

Ignorant is no excuse, i think. The court of law won't have that as a plead.
Basically from Wall Street to Singapore Street they always prey on those even who know something about investments, by playing on their greed. Yes i agreed with you it is really evil preying on the ignoramus. Nevertheless, there must be some greed in play even on the naive too. Another words, no greed, no risk, no gain.
I am not spare too.

[corydorus]

I am quite surprise 40M can be raised that way. We may have over protected our "weaks".
They seems to lost the basic survival skills.

I would prefer much heavier protection against large insituitions like Morgan, Citi, insurance companies, banks etc who offered products against the interests of clients as is much harder to avoid due to reasonable level of trust given and scale of impacts to broader economy. Huge penalty and long jails time on all their executives should be the deterent. Currently there is huge mismatch of punishment and rewards i feel.

Cory

[Temperament]

People who are operating in "Wall Street to Singapore Street" most of them are way above average intelligence. Especially they know how greed works on people. The Government or Regulators can have 101 rules, and yet they still can come out with new financial products for the masses. By the the time the hoi polloi suffers great financial losses, the Regulators are still catching up on regulations.
Now Wall street has the latest "hot products" called "ETF". i think the next market collapse will have something to do with these products.

For me, i should always try to understand the risks of a financial product before looking at the return. Can't understand don't buy. It's beyond my intelligence. My CPU is not good enough to run the program. i am not smart enough another words for this product.
If i really understand where the risks are and happy with the potential return, then i may invest. i am quite risks averse but not the type who buys money market funds, bonds, unit trusts. In fact i dislike markets fund. When i was younger i believe in putting as much money in the stock market as possible except maybe a year salary to stand by for emergency.

[Jacmar]

Ignorant is no excuse, i think. The court of law won't have that as a plead.
Basically from Wall Street to Singapore Street they always prey on those even who know something about investments, by playing on their greed. Yes i agreed with you it is really evil preying on the ignoramus. Nevertheless, there must be some greed in play even on the naive too. Another words, no greed, no risk, no gain.
I am not spare too.

sometimes it is not just ignorant and greed at play. some peole who have been conned by trickster claimed that they have been "mesmeried'/"hynotised" too. not sure about that but one thing for sure is that some of these tricksters are such smooth talkers. try attending some of these hard push sales programs like share-vacation and you will know what i mean. My wife nearly got conned into buying a $5k vacuum cleaner. she felt 'obliged' to buy to get her off her back.

[yeokiwi]

sometimes it is not just ignorant and greed at play. some peole who have been conned by trickster claimed that they have been "mesmeried'/"hynotised" too. not sure about that but one thing for sure is that some of these tricksters are such smooth talkers. try attending some of these hard push sales programs like share-vacation and you will know what i mean. My wife nearly got conned into buying a $5k vacuum cleaner. she felt 'obliged' to buy to get her off her back.

Hard selling normally comes with inducing guiltiness into potential customers for wasting their times in explaining and the sales person will also throw some sarcasms to tickle the prides of customers.
Frankly speaking, it is extremely irritating.

I had been to time share talk by Marriot Vacation and the promoter used the following tricks after we rejected the offer:
1) showed dejected face => why waste my time..
2) lamenting that we had given such a good offer a pass...
3) showed us photo album of those who bought the package => see.. so many people buy, u silly couple..
4) started to ask how much was your budget => once you offered any amount, they would structure a deal immediately and made it your fault if you rejected it later.
5) restructure the price of the package
6) offered even more freebies
7) when all else failed, asked tha manager to come for next round of talk..

why we went for the talk? they offered $200 taka vouchers if we attended the talk..haha
not too bad for 1.5 hr of time. I thought we were the fastest to get out. Many of them were still stuck.
Lastly, quite a nice training session to handle these hard sell promoters.

[Temperament]

Ignorant is no excuse, i think. The court of law won't have that as a plead.
Basically from Wall Street to Singapore Street they always prey on those even who know something about investments, by playing on their greed. Yes i agreed with you it is really evil preying on the ignoramus. Nevertheless, there must be some greed in play even on the naive too. Another words, no greed, no risk, no gain.
I am not spare too.

sometimes it is not just ignorant and greed at play. some peole who have been conned by trickster claimed that they have been "mesmeried'/"hynotised" too. not sure about that but one thing for sure is that some of these tricksters are such smooth talkers. try attending some of these hard push sales programs like share-vacation and you will know what i mean. My wife nearly got conned into buying a $5k vacuum cleaner. she felt 'obliged' to buy to get her off her back.

Yes i agreed.
We all know some doctors use the practice of hynotism for the well-being of their patients.
i have come across "super-saleman" more than one time who can talk to you in a way that make you feel you are the nicest person in this whole wide world. if you can still escape from buying from him, i salute you. Nine out of ten times i will at least buy something from him.
Mesmeration? Hynotism?
Definitely; who can really understands completely how our brain works?