As a follow up to the previous post Genneva Gold Trading Firm Gets Raided in both Singapore and Malaysia, Bank Negara has released an official statement regarding the raid.

It has found the schemes to be “not sustainable to provide the promised high monthly returns, nor would they be able to provide the buy back guarantee of gold. Such schemes are not sustainable because the returns promised are not funded through gold trading, but from the monies invested into such schemes.”

What’s worse is that “The investigations have also revealed that the amount of assets and monies held by these companies do not commensurate with the amount collected from their investors. ” So it means that the company is actually already insolvent as it does not have the assets to satisfy the liabilities incurred by the guarantees.

That have also been warning signs of an impending collapse, so its ...