You will be able to verify whether a firm is licensed and whether MAS has flagged it.
An ad keeps appearing in your feed. A firm with a polished website offers a managed portfolio returning a steady 2 percent a month, says it's "regulated", and shows a licence number in small print at the bottom of every page. You've never heard of it, but it looks serious, and a colleague says his cousin has invested.
Before any money moves, there's a check you can do in about ten minutes that rules out many investment scams. It uses two free tools on the Monetary Authority of Singapore website. This lesson shows you what each one tells you, what it doesn't, and how scammers try to get around them.
MAS regulates the financial institutions that deal with the public in Singapore, including banks, insurers, fund managers and firms that deal in investments. It publishes two lists that matter for anyone being offered an investment, and they answer different questions.
The Financial Institutions Directory answers the question "Is this firm regulated by MAS, and for what?" It lists firms that MAS regulates, along with the type of licence or status each holds and the regulated activities it's allowed to carry out. A firm can be licensed for one activity, such as giving financial advice, but not another, such as managing your money. The entry also generally shows the firm's registered contact details.
The Investor Alert List answers a different question: "Has MAS flagged this name?" It lists unregulated persons, meaning firms, websites and individuals, that may have been wrongly thought to be licensed or authorised by MAS. MAS builds it from information it receives, and says it isn't a complete list. Being on it is a strong warning.
The mistake people often make is to check only the alert list. They search for the firm's name, find nothing, and decide it must be safe.
That reasoning doesn't hold up. The alert list only contains names MAS knows about and has added. A new scam firm, or one that changed its name last month, won't be on it yet. Scammers launch new names all the time, precisely because older ones get listed.
So a firm missing from the alert list is not proof it's safe. The useful test is the other way round: a firm offering you an investment should appear in the Financial Institutions Directory, licensed for the activity it's offering you. If it isn't there, that's the signal to stop, whatever its website says about being regulated.
Put the two checks together and the outcomes are easy to read. Listed in the directory for the right activity and not on the alert list means you can move on to judging the investment itself. Not in the directory, whether or not it's on the alert list, means walk away.
The checks above can still be beaten if you look up the wrong thing. Scammers often clone real, licensed firms. They use the same name, or one that differs by a word or a letter. They copy the logo, the address and even the real licence number. Then they put it all on a website with a slightly different address, or in an app that has nothing to do with the real firm.
If you search the directory for the name on the ad and find a real, licensed firm, you might think you're done. But you've only confirmed that a real firm with that name exists. You haven't confirmed that you're dealing with it.
So check the details as well as the name. Compare the website address and phone number you were given with the ones listed for the firm in the directory, or on the real firm's own website that you found yourself. Look closely at the spelling of the web address, letter by letter. If the details don't match, contact the real firm through its official channels and ask whether the offer, the person and the app are theirs.
Here is how the check might go for the ad at the top of this lesson. Nadia searches the Financial Institutions Directory for the firm's name and finds nothing. She tries a few spellings, and then searches by the licence number shown on the website, which turns out to belong to a different, real firm with a similar name. She checks the Investor Alert List and finds the firm's website address listed there.
Nadia now knows three things: the firm isn't regulated by MAS, it's borrowing a real firm's licence number, and MAS has flagged it. She doesn't need to think about the 2 percent a month any further.
Even when a firm passes both checks, that only means it's allowed to offer the service. It doesn't mean a particular product suits you or will make money. Licensed firms sell risky products too, and whether a product suits you is a separate decision from whether the firm is real.
The fastest way to get comfortable with these tools is to use them once on a firm you've actually seen advertised, before you need them for real.
Look up one firm you have seen advertised in both the MAS Financial Institutions Directory and the Investor Alert List and record what you find.
Junxiong-WFG Organisation is an authorised representative of AIA Financial Advisers Private Limited (Reg. No. 201715016G).