IPOH: An Ipoh-based company, Bestino Group Bhd, which was raided by Bank Negara Malaysia (BNM) and the Securities Commission (SC) in June last year on suspicion of illegal deposit-taking, may be a front for the “biggest money-laundering” operations in the country, according to Buntong assemblyman A Sivasubramaniam.
Despite the BNM and SC raids last year, there were still unanswered questions involving the missing millions invested by Malaysians, in particular those in Perak, he said.
Sivasubramaniam is urging Prime Minister Najib Tun Razak to immediately step in and order a police investigation into Bestino Group.
“We want the prime minister to order an investigation… millions have been lost.
“I believe this is one of the biggest illegal money-laundering operations in the country.
“I urge the federal government to take investors’ complaints seriously,” he said, adding that the Perak opposition parlimentarians planned to bring up the issue at the next parliamentary sitting.
Meanwhile, the BNM raids, which were widely reported in the Tamil media but received scant attention from others, has forced Bestino to keep a low profile.
FMT, which visited the Bestino circle in Ipoh, discovered that the company is allegedly still active and had thrived on recommendations and word-of-mouth marketing.
Gold mines
Bestino Group, which lists “gold” as its nature of work, however, only became a buzzword after BNM raided its premises last June for alleged money laundering.
Bestino had reportedly collected more than RM400 million from the public comprising mainly Indians since it began operations.
Bestino’s leading figure has been the well-known Batu Pahat jeweller Chong Yuk Ming. Chong is also a director in Bestino, which was previously known as Bestino Golden House Sdn Bhd, set up in 2006.
In 2007, the company allegedly recruited former assistant superintendent of police (ASP) V Krishnan and ex-BNM officer S Balachandran to recruit Indian investors.
According to some investors, Krishnan and Balachandran told them that Bestino had purchased 14 gold mines in Papua New Guinea and that they could see a 36% dividend on a RM10,000 investment.
In 2008, the company changed its name to Bestino Group Bhd and Krishnan was appointed as director in the new company while Balachandran allegedly became the key “link” between BNM and Bestino.
On record, Bestino has nearly 6,800 investors who have invested a total of RM400 million in Bestino, within three years of setting up business. However, this does not include the gold that the investors re-invested in Bestino totalling RM300 million.
A few were sceptical about the “investments” because investors were offered a 36% dividend on their first RM10,000 investment and gold “biscuits” worth RM7,000 for free.
It was to Bestino’s advantage that it had Chong and prominent individuals like MIC Perak state secretary Jayagopi and a former army sergeant, Haridass and MP N Gobalakrishnan’s brother N Loganathan, vouching for the company and encouraging the public to invest in it.
Money laundering
According to an investor Nalluran, 74, a pensioner from the Perak Water Board, he invested RM20,000 because he “believed” in Chong’s involvement.
“He is a well-known man here; everybody knows Batu Pahat goldsmith Chong.”
Explaining the investment, Nalluran said: “At the start, they (Bestino) bank in dividends in our accounts every month.
“After one year, they threw us a new offer. They said if we gave back the gold which Bestino had given us, then they would be ready to give us 60% dividend per annum.
“After a year we were confident of them and accepted the offer. But after a few months everything went wrong,” he said.
However, Chong had sent out letters to investors assuring them they would get back their investments within three months and asked them to be patient.
Nalluran, however, was unaware of BNM’s raid on Bestino on June 16 last year.
BNM and the SC had reportedly commenced investigations into the Bestino Group and its related companies on suspicion of illegal money laundering.
In a joint statement, the central bank and the SC had reportedly said the company was in breach of subsection 25(1) of the Banking and Financial Institutions Act 1989 (BAFIA) and the offering for subscription or purchase of preference shares in breach of section 212(2) of the
Capital Markets and Services Act 2007.
Following complaints from the public, BNM and SC raided Bestino Group and its related companies in Ipoh, Perak and Petaling Jaya, Selangor.
High-stake gambling
Meanwhile, former PKR secretary-general PS Jenapala finds the whole Bestino scam frustrating. He claimed that Ipoh had become a nest for illegal operations.
“Ipoh seems to be the focus of illegal activities. First, we had the Fresh Farm scam, and now Bestino,” said Jenapala, who is now the pro tem president of the Indian Justice Party (IJP).
Jenapala was alluding to the recent Ipoh High Court ruling last week ordering Fresh Farm Bhd, which began operations in Ipoh three years ago, to pay RM26 million to its predominantly Indian investors. Fresh Farm reportedly had 2,000 members participating in its scheme.
According to Jenapala, there was no truth in Bestino’s claim that it had mines in Papua New Guinea and bought its gold from there.
“There are rumours that Bestino is gambling people investments in Macau and that a huge amount of money is stuck in Macau.
“When the BNM raided them here, they only managed to seize RM14 million, which is a small portion of the total investments.
“This raises the question: who’s holding the rest of the money?”
To a question on why the police were slow to react to public complaints, Jenapal said: “Almost 70% of Bestino’s agents are from the police force.
“Do you believe the police will push for a probe? I doubt it.
“If the government continues to remain silent on this issue, it will be another Maika Holdings scandal,” he said. - FMT
As an investor, I suspected, although too late, that it was a ML scam with probable BNM/SC cover up....especially when Bestino sent out letters to investors written unprofessionaly with wording such as "..we had a good meeting last week with the relevant authorities..". I also came to know that they had no operational gold mines in PNG when I offered Chong and Krishnan my services as a mediator to sell the mines to a Dutch company when they claimed that they were desperately trying to find a buyer to pay off investors. Chong said they already got a firm buyer from China and were awaiting BN clearance for money transfer. However, he said that he could get mining licences for my potential buyer as he was close to the PM. Lately, whilst handing in a petition in Putrajaya (about 300 investors were there) the Finance Ministry denied any knowledge of BNs raid, and all this is news to them only now! Those who sadly passed away whilst desperately depending on Bestino's false promises for the return of their hard-earned EPF money would be turning in their graves! Heaven knows how despicable the system is and how the authorities shamelessly and heartlessly collude for financial gains. ps Many thanks Messrs Sivasubramaniam and Jenapala for your care and concern for the 6800 or so investors, many of whom were conned into investing their EPF savings.
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