Yesterday, Malaysia gold investor community read a shocking news about Genneva Malaysia office raided by BNM (Bank negara Malaysia). I found out about it from a group of my Facebook friends who are a die hard fan of Genneva Malaysia Sdn Bhd. The news about the raid at their Jalan Kuchai Lama office become a hot story between them in Facebook. Some of them plan to go to Jalan Kuchai Lama to give support for Genneva Malaysia. The Raid headed by Bank Negara Malaysia (BNM) with cooperation from the Royal Malaysian Police, Ministry of Domestic Trade, Cooperatives and Consumerism and Companies Commission of Malaysia. Singapore’s Commercial Affairs Department has also conducted a similar operation against Genneva Pte. Ltd. in Singapore. In a statement released yesterday, Bank Negara said the raid was to probe suspected offences under the laws administered by the agencies.
The Star News reported, Bank Negara start the raid operation starting at 8am in Putrajaya with a briefing to all the other agencies before the simultaneous raids were conducted. All Genneva staff statements are recorded in the operation and they only allowed to leave the office at about 9pm. Some of the raid officers were seen carting away hundred boxes of documents and files from the two premises located opposite each other. As of 9.30pm, Bank Negara officers were still going through the records while customers of the company waited. Around 100 customers gathered at the Genneva World office in support of Genneva after hearing of the raid yesterday afternoon.
In its website (www.gennevaworld.com.my), they claimed that Genneva is a corporate member of the Gold Bullion Entrepreneurs Association of Malaysia. They also claimed that their business model was based on the Syariah principle of "Al-Bai" (Sale and Purchase). They give "Hibah" as a rewards to their customers. They also claimed Genneva is a reporting institution under the Anti-Money Laundering and Anti-Terrorism Financing Act, (AMLA) 2001 and understands its responsibilities and duties.
In July 2009, Bank Negara Malaysia has commenced investigations into Genneva Sdn Bhd under suspicion of conducting illegal deposit taking activities in breach of Section 25(1) Banking and Financial Institutions Act 1989 (BAFIA) and Section 4(1) of Anti-Money Laundering and Anti-Terrorism Financing Act 2001 (AMLATFA). Section 25(1) of BAFIA 1989 prohibits any person from receiving, taking, or accepting deposits without having a valid license, whereas Section 4(1) of AMLATFA 2001 prohibits any person from engaging in, or attempting to engage in, or abetting the commission of money laundering activities.
National Fatwa Council decision about Genneva Malaysia Sdn. Bhd:
"Berdasarkan laporan dan hasil siasatan Bank Negara Malaysia terhadap operasi jual beli dan pelaburan emas oleh Syarikat Genneva Malaysia Sdn. Bhd., Muzakarah bersetuju memutuskan bahawa transaksi jual beli dan pelaburan emas yang dilaksanakan oleh Syarikat Genneva Malaysia Sdn. Bhd. tidak mematuhi sepenuhnya Parameter Pelaburan Emas sepertimana yang telah diperakukan oleh Muzakarah Jawatankuasa Fatwa Majlis Kebangsaan Bagi Hal Ehwal Ugama Islam Malaysia Kali Ke-96 pada 13 hingga 15 Oktober 2011."
Source: E-fatwa.
As what I understand, they give a monthly profit/dividend of 2% from your investment value but their gold market price are very high at around 25% higher from other dealers. They said the contract is for 3 months but some of my friends complaint they don't even get the gold in their hand even after the 3 months period. Their so called Syariah compliant "Al-Bai" did not comply with syariah and national law as what has been declared by the National Fatwa Council on 11 July 2012. They still using the "Islamic" terms in their website even after the National Fatwa Council decision (I still can read it today). Almost all their consultants are non-Muslim but they're using "Islamic" terms to attract their Malay customer. You're already paying a very high premium for your gold (if you get your gold) and when the gold price drop, the company will have a big problem to maintain their cash flow. The company is understood to have involved in the gold trade involving more than RM5 billion since 2007. In 2007 they're using the name Samudra, later change it with Genneva and again last year change its name into Genneva Malaysia. Most of their victims are new gold investor who don't know anything about gold investment.
I also heard rumours, they're few other companies with the same Modus Operandi as Genneva Malaysia will be raid by BNM and their affiliates in the near future. I cannot share it in here but if your gold investment company are in BNM illegal gold investment company list (you can read it here; illegal Investment Company under BNM), my suggestion is to try to get your money back as soon as possible. When BNM come in, you cannot get back your money until BNM have finish their investigation. I knew some of my friends are using personal loans to join these kind of scheme. They will be losing a lot of money (which they don't exactly own) if they don't have any gold in their hand.
Try invest in real gold bar or gold dinar instead. They're many honest gold trader in Malaysia nowadays.
