The Securities Commission Malaysia (SC) has recently cracked down on Huobi Global Limited and its Chief Executive Officer, Leon Li, for operating a digital asset exchange (DAX) in Malaysia without proper registration. This enforcement action highlights the SC’s commitment to ensuring compliance with local regulatory requirements and safeguarding the interests of investors.
As a result of their unlawful operations, Huobi Global Limited and Leon Li have faced stern consequences. The SC has publicly reprimanded both parties for their illegal activities within Malaysia. In addition, the SC has issued a directive for Huobi Global Limited to cease its operations in the country, including disabling its website and mobile application on platforms like Apple Store, Google Play, and other digital application platforms.
Furthermore, Huobi Global Limited has been instructed to halt the circulation, publication, or sending of any advertisements to Malaysian investors, be it through email or social media platforms. Leon Li, as the CEO, has been specifically tasked with ensuring compliance with these directives.
The SC’s decision to take action against Huobi Global Limited stems from the company’s failure to obtain registration as a Recognised Market Operator (RMO) with the SC, as required by Section 7(1) of the Capital Markets and Services Act 2007. This breach of regulatory protocol has been treated as a serious offense by the SC, prompting swift and decisive action.
The SC emphasizes the importance of Malaysian investors immediately ceasing all trading activities through Huobi Global Limited’s platform. It is strongly advised that investors withdraw their investments and close their accounts associated with the company. Instead, investors are encouraged to engage with RMOs that are registered with the SC. Registered RMOs undergo rigorous regulatory scrutiny and adhere to strict guidelines to ensure investor protection under Malaysia’s securities laws.
Investors are urged to exercise caution when selecting investment platforms, always conducting thorough due diligence before making any investment decisions. Additionally, they should be wary of investment schemes that promise excessively high returns with minimal risk, as such promises often turn out to be fraudulent. By taking these precautions, investors can safeguard their investments and avoid falling victim to fraudulent schemes.
The recent enforcement action against Huobi Global Limited serves as a reminder that the SC is committed to maintaining a fair and transparent investment environment in Malaysia. By ensuring compliance and protecting investors, the SC aims to foster trust and confidence in the country’s securities market.
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