Malaysia | Demarcating the bank’s duty in investment scams

Scams are common these days. Hence, the regulatory bodies, financial institutions and news media often warn the public to exercise due diligence before making any investments with promises of high-profit returns.

In this connection, where does the law draw the line insofar as the banks’ duty of care is concerned? Apart from checking that the payments are duly authorized, do the banks also owe a duty to query, investigate, and advise their customers about the goods, services, investments, charities, or the random stranger who just called (“Separate Transactions”)? “Separate Transactions” – because that purchase or investment is between the customer and the Merchants, and not the banks.

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Yee Mei Ken

Partner / Dispute Resolution / Private Client & Family Business / Regulatory Compliance & Enforcement / Arbitration & Mediation / Head, China Desk
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