Police are on the trail of the senior officials of an online futures exchange brokerage accused of cheating its clients.
According to some estimates, the company, known as Global Growth or Golden Global, may have defrauded its clients of nearly US$1.5 million.
Though allegations of cheating have been widespread for some weeks, at this point only one client, who has requested anonymity, has complained to the police.
Police in Kyauktada township, Yangon, have opened a case file under section 420 of the criminal code, dealing with fraud. They are seeking to interview the managing director and two other high-level officials of the company. They say the complainant lost about K20 million.
A reporter from The Myanmar Times found the company’s opulent offices in Sakura Tower, downtown Yangon, closed yesterday. The company had been operating for about a year.
“This case is about greed,” said a police officer at Kyauktada station, adding that there may be as many as 300 victims.
“Most of them are waiting and watching to see how this develops. If our case succeeds, more victims may come forward,” he said.
However, it is understood that about 50 former clients of the brokerage company wrote to the Bureau of Special Investigations – an economic crime-fighting taskforce – and the Ministry of Home Affairs on June 30, one of the signatories said yesterday. He added that he lost K15 million, and some of his colleagues lost K60 million.
The letter makes allegations about the local partner, the managing director and other directors. “They offered jobs and investment opportunities to their employees and to customers,” he said.
The persons sought by the police are both foreigners and Myanmar citizens.
But a former customer told The Myanmar Times that there might be guilty parties other than those the police are seeking.
In view of the scale of the losses, the police said the case could be handled by the BSI.
The company charged clients a minimum $5000 deposit for investments in global commodity markets, say police.
The company said it was a branch of Standard Bullion, a member company of the Chinese Gold and Silver Exchange Society (CGSE). Customers were charged a $50 commission fee for each $1000 investment, according to a former customer.
The local newspaper 7 Day Daily reported on June 14 that the brokerage company had allegedly defrauded its clients of $1.48 million.
There are six or seven online futures exchange brokerage companies in Myanmar, most of which were established in mid-2014.
Deputy Minister for Finance U Maung Maung Thein said last April that the government would warn these companies to cease operations, as futures trading was illegal in Myanmar. However, it is not clear what action, if any, the government took.
The 2013 Securities Exchange Law stipulates that stock trading companies must receive permission from the Securities and Exchange Commission, or face a prison sentence of up to two years.
Source: Myanmar Times