When Recovery Agents Make You Lose More Money

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PETALING JAYA: If losing money to a scam is not bad enough, attemp­ting to recover the lost funds through so-called recovery agents could make victims even poorer.
Deputy chairman of the Malaysian Bar’s ad hoc Parliament liaison committee V. Kokila Vaani said appointing scam recovery agents often led desperate victims into a second trap, causing them further losses.
She added that recovery of funds lost to scams in Malaysia was an uphill task with success rates being less than 20%.
She said that scammers often move their ill-gotten gains swiftly to foreign bank accounts, through third parties or convert it to cryptocurrency, making following the money trail a challenge.
“Courts have awarded recoveries in some fraud trials. It was partial refunds after deducting fake “returns”, but if the perpetrators go bankrupt or vanish, all become irrecoverable,” she said.
Instead of resorting to recovery agents, she advised victims to act swiftly by lodging police reports and only consult legitimate lawyers for further advice.
“Any promise of easy refunds or recovery are often just another trap that may cause hefty losses again,” she said.
Scams involving rogue lawyers over the past four years saw 167 victims defrauded of over RM160mil, with most of the lost funds remaining unrecovered.
Kokila told The Star that the public can reach out to the Bar Council directly if they are in doubt or need to verify any legal services offered by any party.
“Genuine lawyers never demand upfront payments through unofficial channels or pressure clients to make hasty decisions. When in doubt, insist on official verification,” she said.
She added that since 2023, the Bar Council has lodged six police reports against individuals who had impersonated lawyers and used forged documents to carry out fraudulent dealings.
Criminal lawyer KA Ramu said that awareness is the key to minimising the risk of getting defrauded by scammers using social media platforms to impersonate lawyers.
“It is not easy to control this but the Communications Ministry and Digital Ministry should be stern with social media platforms and order them to remove such advertisements promptly.
Ramu said with AI and deepfakes, scams could get even harder to detect, particularly among older Malaysians who are more vulnerable.
“We may be unable to eradicate scams but we can minimise the risk of falling into scam traps,” he added. - Star

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