The Securities Commission Malaysia (SC) has recently taken decisive action against Huobi Global Limited and its Chief Executive Officer, Leon Li, for operating a digital asset exchange (DAX) in Malaysia without proper registration.
In response, the SC has issued a public reprimand directed at Huobi Global Limited and Leon Li for their illegal operations within Malaysia. Furthermore, the SC has ordered Huobi Global Limited to immediately cease its operations in the country, which includes disabling its website and mobile application on platforms such as Apple Store, Google Play, and other digital application platforms.
Additionally, Huobi Global Limited has been instructed to refrain from circulating, publishing, or sending any advertisements via email or social media platforms to Malaysian investors. The CEO, Leon Li, has been specifically tasked with ensuring compliance with these directives.
The decision to take action against Huobi Global Limited stems from concerns over the platform’s lack of compliance with local regulatory requirements and its failure to protect investors’ interests. The SC considers this breach a serious matter, as operating a DAX without obtaining the SC’s registration as a Recognised Market Operator (RMO) is an offense under Section 7(1) of the Capital Markets and Services Act 2007.
The SC strongly urges Malaysian investors who have been using Huobi Global Limited’s platform to immediately cease trading through the platform, withdraw their investments, and close their accounts.
Investors are advised to exercise caution and only engage with RMOs that are registered with the SC. Registered RMOs undergo rigorous regulatory scrutiny and must adhere to strict guidelines, providing investors with protection under Malaysia’s securities laws. Investing with unlicensed or unregistered entities or individuals exposes investors to risks such as fraud and may leave them without the protection of Malaysian securities laws.
It is crucial for investors to conduct thorough due diligence and carefully choose investment platforms. They should be wary of investment schemes that promise high returns with minimal risk, as such promises may be too good to be true. By taking these precautions, investors can safeguard their investments and avoid falling victim to fraudulent schemes.
23 May 2023
