Capital Market Development Authority CMDA has asked victims of unlicensed investment schemes to share their information with the authority.
This comes after the Police said that it had started investigating the company owned by former MP for Feydhoo constituency Alhan Fahmy named 'King’s Forex Trading' which is alleged to have run a Ponzi scheme by local authorities.
Earlier, the Bank of Maldives had froze the company's accounts over the allegations.
In a statement, CMDA cited the Maldives Securities Act and said that it is the Authority's responsibility to maintain surveillance over the securities market and the Stock Exchange and to ensure orderly, open, fair, and equitable dealings in Securities in compliance with the law and regulation.
CMDA said that financial schemes that look to make profits by using investments from more than one investor by investing in different businesses or by any other means fall under securities.
It also said that hence such schemes should be licensed as per the proper proceedings defined in the law and that promoting the fund publically with proper licensing is prohibited.
CMDA added that any individual or party who has lost funds to such an unlicensed party should inform the Authority via email.
Central Bank MMA had said that it had instructed all banks to take action against the company and that it had been taking money from clients after promoting its investment schemes on social media platforms like Facebook and Telegram.
In a statement earlier, the company had said that BML had not given it a reason why its accounts were frozen but there were no outstanding payments related to the company.
It had also said that the company would sue BML for damages caused because of its decision.
A Ponzi scheme is an investment fraud that pays existing investors with funds collected from new investors.
