Malaysia arrests 21 Chinese nationals over alleged fake investment scam targeting victims in China

MELAKA, MALAYSIA: Malaysian police have arrested 21 Chinese nationals suspected of operating a fraudulent investment call centre from a two-storey bungalow in Ayer Keroh, Melaka, in the latest operation targeting transnational online scam syndicates.

The suspects, all men aged between 23 and 54, were detained during an 8pm raid on 13 July 2026 conducted by the Commercial Crime Investigation Division from the Melaka Tengah Police Headquarters.

Melaka Tengah acting police chief Superintendent Halim Abas said investigators believe the syndicate had been promoting a non-existent stock investment scheme targeting victims in China since the beginning of July.

Call centre operated from rented bungalow

According to Superintendent Halim, preliminary investigations found the bungalow had functioned as the syndicate's call centre for about two weeks before the raid.

"The bungalow had been used as the syndicate's call centre and is believed to have been in operation for about two weeks," he said during a media conference at the Melaka Tengah Police Headquarters.

He said all 21 suspects allegedly worked as customer service representatives responsible for approaching and recruiting potential victims.

"The syndicate's modus operandi was to deceive victims by promising lucrative returns within a short period," he said.

Victims who expressed interest were allegedly instructed to visit a website containing information about the purported investment opportunity before other syndicate members took over communications and persuaded them to transfer money.

Equipment seized during raid

Police seized equipment estimated to be worth RM25,000 (approximately US$6,142), including eight desktop computers, three laptops, two modems, one Skyworth router, 14 mobile phones and a USB adapter believed to have been used in the alleged scam operation.

Investigators also discovered that none of the suspects possessed valid identification documents or travel papers, including passports.

Superintendent Halim said all 21 suspects have been remanded for 14 days from 14 July 2026.

The case is being investigated under Section 420 of the Penal Code for cheating and Section 6(1)(c) of the Immigration Act 1959/63.

Police are also examining whether the group has links to other investment scam syndicates previously dismantled in Melaka.

"We do not rule out the possibility that this syndicate has links to investment scam syndicates that were previously busted in Melaka," Superintendent Halim said.

Series of recent scam centre raids

The latest arrests follow several major enforcement operations targeting foreign-run scam centres across Malaysia.

On 22 June, Melaka police arrested 31 foreign nationals after raiding a rented house in Klebang that had allegedly operated as a fraudulent investment call centre for about two months.

Those detained comprised 30 Chinese men and one South Korean woman aged between 20 and 40.

Three days later, on 25 June, police in Kuala Lumpur dismantled another suspected online investment scam syndicate operating from a luxury condominium.

That operation resulted in the arrests of nine Chinese nationals and one Malaysian.

Investigators said the condominium served as both the suspects' workplace and accommodation, with occupants deliberately remaining indoors to avoid attracting attention from nearby residents.

Authorities believe the syndicate was involved in a fraudulent foreign exchange investment scheme targeting victims in China.

Concerns over regional relocation

The continuing series of raids has reinforced concerns that organised scam syndicates are adapting to intensified law enforcement efforts across Southeast Asia by relocating their operations.

Recent crackdowns along the Thai-Myanmar border, as well as in Cambodia and Laos, have disrupted numerous large-scale scam compounds linked to online fraud.

Earlier in June, a Malaysian anti-trafficking non-governmental organisation alleged that criminal groups displaced from Cambodia, Laos and Myanmar could be shifting operations into Malaysia.

The allegation prompted police to call for intelligence and evidence while increasing scrutiny of possible cross-border movements by organised criminal networks.

In recent months, Malaysian authorities have uncovered alleged scam centres targeting victims in China, Singapore, Indonesia, Italy and Spain.

Investigations indicate that many of the operations specialised in cryptocurrency investment fraud, romance scams, fake employment offers and other forms of online deception.

During May 2026 alone, police raids across Perak, Selangor, Johor and Kelantan resulted in more than 100 arrests, with most suspects identified as foreign nationals.

One notable operation in Johor led to the dismantling of a syndicate accused of targeting victims in Spain through fraudulent online recruitment advertisements.

Police arrested 35 Chinese nationals in that case and alleged the group used artificial intelligence-powered translation software, messaging applications and scripted conversations to communicate with victims and facilitate the fraud.

Malaysia loses US$684.6 million to financial scams in 2025

The case emerged against a backdrop of rapidly increasing financial scam losses nationwide.

According to a written parliamentary reply by Malaysia’s Home Ministry dated 21 January 2026, the country recorded RM2.77 billion (approximately US$684.6 million) in financial scam losses in 2025 alone.

The figure marked the highest annual total recorded over the past three years.

Cumulative losses from online and financial fraud between 2023 and 2025 reached RM5.62 billion, highlighting what authorities described as an increasingly sophisticated and escalating criminal threat.

The Home Ministry stated that scam-related losses totalled RM1.28 billion in 2023 before rising to RM1.57 billion in 2024.

Losses then surged sharply again in 2025.

The ministry told Parliament that scams involving fraudulent phone calls, romance schemes, e-commerce fraud, fake financing offers and non-existent investment opportunities continued to account for the majority of reported cases.

Authorities said such scams remain widespread because criminal syndicates are highly adaptable and increasingly reliant on digital platforms capable of reaching victims rapidly across borders.