Bank Negara has revealed that more than 8,000 customers of gold investment company Genneva Malaysia Sdn Bhd have yet to receive their gold amounting to over 4,000kg, despite having settled the payments.
In a statement on Monday, the bank added that documents seized from the company also revealed that some customers, who had surrendered their gold to the company, had not received their cash reimbursements amounting to more than RM80mil in total.
“Initial forensic accounting has uncovered considerable losses experienced by the company in 2012. The company has liabilities exceeding 10 times its assets.
“Selling gold at about 20% to 25% higher than the market price, paying returns of about 2% to 3% per month to customers and buying back the gold from customers at the initial purchase price has not been a sustainable venture,” the statement read.
It also noted that cash flow for the company to sustain its operations had relied heavily on the amount collected from new customers.
Genneva, was raided by Bank Negara, the police, Domestic Trade, Cooperatives and Consumerism Ministry and the Companies Commission of Malaysia on Oct 2.
Three days later, the authorities conducted raids on the premises of Pageantry Gold Bhd, Caesar Gold Sdn Bhd and Worldwide Far East Bhd on suspicion of illegal deposit-taking, money-laundering, tax evasion and avoidance and false description.
The statement said Genneva had RM99.8mil frozen and 126kg of gold seized, which the bank said were required for investigations and will only be dealt with at the direction of the courts.
The public are advised to refer to Bank Negara Malaysia’s website for further information.