Why unregulated investments are riskier than they look

Got a DM about an ‘exclusive’ investment? And that you can double your money if you act fast? Be careful! If the platform or person offering the investment isn’t regulated by MAS, you could be putting your money in serious danger.

Let’s break down what ‘unregulated’ really means, and why it matters.

What are unregulated investments?

These are investments that fall outside of Monetary Authority of Singapore’s (MAS) regulatory rules. That could mean:

• The company or platform offering the investment isn’t licensed by MAS
• The product or activity itself isn’t something MAS regulates

In both cases, it means there’s no regulatory oversight. If anything goes wrong, like fraud, mismanagement, or the platform vanishing, you’re mostly on your own.

What are the risks?

MAS will not be to take regulatory action should there be any wrongdoing by the entity. This includes the following in the event of disputes.

• Consumer safeguards and recourse avenues such as Financial Industry Disputes Resolution Centre (FIDRec) would not be available
• MAS and the Singapore Police Force have little to no reach over the entity and its activities if they are based overseas

How to protect yourself

Always verify before you invest.

• Check MAS’ Financial Institution Representatives Register for the list of financial institutions regulated by MAS and the regulated activities they are authorised to provide.
• Use the Financial Institution Representatives Register to verify if an individual is authorised to give financial advice or sell products.

• Even if a name shows up, don’t just take it at face value. Meet the person in real life and verify their identity with an official ID. Scammers have been known to impersonate legit agents.

Dealing with unregulated investments means you’re giving up important legal protections. No matter how convincing the pitch sounds, your money has no safety net.