Probe into VenusFX

KUALA LUMPUR: Police have begun investigations into foreign currency trading company VenusFX and companies linked to it over alleged illegal deposit-taking amounting to tens of millions of ringgit since last year.
It is learnt that several dozen police reports have been lodged nationwide against the company by hundreds of investors who claimed to have lost between RM1,000 and several million ringgit after being promised high returns of up to 30% a month.
Kuala Lumpur police commercial crimes investigations department (CCID) chief ACP Mohd Luthfi Ismail Abdullah confirmed city police had received reports from investors.
"We have begun investigations for cheating under Section 420 of the Penal Code. Investigations are in progress," he said, declining to comment further.
It is learnt that police are in the midst of compiling dozens of reports made against VenusFX nationwide and are expected to hold discussions with the federal CCID and Bank Negara soon before a full-scale investigation.
Sources said initial findings showed the business module of the company was similar to the pyramid system associated with Ponzi schemes.
Checks by theSun found VenusFX was a company registered in New Zealand with a virtual address.
Apart from Malaysians, it is also believed to have investors from other countries.
Although there were no clear indications of its management structure, it is said to be led by two businessmen, both Malaysians in their late 20's.
Since its inception a year ago, the company had allegedly been operating its business illegally without a banking and financial services licence from Bank Negara.
However, in June this year, a company called the Malaysia Ventures Entrepreneur Foundation (MVEF) run by a Datuk Seri and his wife, who is also a Datuk, made a business proposition to the owners of VenusFX offering to legalise their operations by obtaining a banking licence through their "connections" in the government.
On Saturday, in an effort to assist duped investors of the scheme, MIC treasurer-general Datuk S. Vell Paari held a press conference in Petaling Jaya with more than 100 of those affected.
He alleged the couple had been name-dropping and claimed that they were close to top government leaders and officials in "high places", including those at the Finance Ministry (MoF).
"The couple met the directors of VenusFX and told them to deposit RM50 million into the account of their foundation as it was to show the MoF the company's turnover in order to be granted a banking licence.
"In a subsequent meeting, the Datuk Seri told the directors that (prime minister) Najib and Rosmah (his wife) had approved the scheme. VenusFX deposited RM5 million into the Datuk Seri's foundation before directing its investors to deposit their investments to the MVEF where another RM2.2 million was paid up. He was aware of VenusFX being a company operating illegally but he continued to offer to legalise it," he said.
Vell Paari alleged that eventually VenusFX learnt it had been duped by the Datuk Seri and ceased all dealings with him.
VenusFX demanded the sum of RM7.2 million be returned to it and following a legal demand issued by its lawyers, it managed to recover RM5 million from the Datuk Seri.
Vell Paari said, however, the Datuk Seri is yet to return the RM2.2 million belonging to between 200 and 300 investors.
"There are about 16,000 investors of this scheme who are mostly Indians. I have advised the Datuk Seri to return the money but this was met with threats from him. I wish to state that I do not fear his cheap threats and will continue pursuing this matter until it is resolved." he told reporters.
In response to the Vell's allegations, MVEF officials Datuk Seri G. Gnanaraja (pix) and his wife, Datuk G.Geethanjali (pix) in a statement denied swindling the affected investors, calling it defamatory.
They said that the sum of RM2.2 million was deposited into the bank account of MVEF without the foundation's knowledge.
As such, they said that the foundation had decided to hold on to the funds to ensure it is returned to the rightful depositors.
Gnanaraja and Geethanjali said they had sought a list of the affected investors from VenusFX but there had been no response from it.