The Securities Commission Malaysia (SC) today ordered Bestino Group Bhd (Bestino Group) to cease issuing preference shares or securities of any kind to the public with immediate effect.
Bestino Group had failed to seek the SC's approval for the offering of their preference shares to the public and to register a prospectus with the SC as required under Section 232 of the Capital Markets and Services Act 2007 (CMSA).
Through a scheme it marketed, Bestino Group claimed to be involved in gold investments and the issuance of redeemable preference shares, promising monthly returns of 3% in dividend payments.
Listed and unlisted public companies wishing to issue securities of any kind to the public must comply with Section 232 of the CMSA, which makes it mandatory to obtain the SC's prior approval as well as register a prospectus that complies with the CMSA and the SC's Prospectus Guidelines. These requirements aim to ensure that investors are provided with all the relevant information on a company, the investment scheme it offers, and the risks involved in order for them to make informed decisions on their investments.
These disclosures form part of the protection required by law for investors. Investors must always ensure they have the benefit of this protection by asking for a copy of the prospectus if they have not been provided one by the company.
Once again, the SC wishes to remind investors to be wary of investment schemes promising extraordinarily high returns within a short investment period. Investors must always check to see if the activity undertaken by the company is legal, and where it requires regulatory approval for the activity, to ensure that the company has the appropriate approvals or licences.
Members of the public with information on illegal investments schemes or suspected scams involving securities of any kind are encouraged to contact the SC via email address email@example.com or via tel: 03-6204 8999/8777.
16 June 2009