This Straits Times article by Ms. Lorna Tan, showed up the greed of Singaporeans again when so many people were being conned by Sunshine Empire, run by James Phang, his wife, Neo Kuon Huay and his partner Jackie Hoo. James and Jackie have been sentenced to nine and seven years jail respectively. James and his wife were both fined $60K each.

This saga will go down in Singapore history as the largest ponzi-like scheme drawing $180 million of funds from thousands of people. It was set up in July 2006.

The article goes to teach us how to identify potential scams…

1) Beware of promises of quick gains – Just sign up and recruit others, sit back and enjoy the quick gains.
2) Know your financial scams – it happened before during the 1970s, the Gemini Chit Fund which wound up in 1972.
3) Deal with regulated providers – Ask if the company is regulated by the Monetary Authority of Singapore (MAS).
4) Check MAS’ Alert List at http://www.moneysense.gov.sg/check_our_list/Consumer_Portal_IAL.html
5) Questions to ask:
a) Is the financial product provider regulated?
b) What are the returns dependent on?
c) When will the returns be paid?
d) How long must you stay invested?
e) How can you monitor the performance of the investment?
6) Risk-Return Trade Off – If anyone offers you high returns and zero or low risk, warning bells should ring: SCAM ALERT!!!