💰 Family finances · #34
My spouse wants to invest in a scheme that promises high, fast returns. How should we judge it?
Be careful: a promise of high, fixed returns in a short time is a common sign of a fraudulent or pyramid scheme, and joining it can be forbidden and can wipe out the family's savings.
Allah forbids consuming one another's wealth unjustly (an-Nisa' 4:29), and schemes that pay old investors with new investors' money fall under consuming wealth unjustly. Warning signs: high returns guaranteed with no risk; rewards for recruiting members; a company that is unregistered or unlicensed; pressure to decide quickly; and using a "Shariah-compliant" label or a religious figure's name to persuade. Check the company with Bank Negara Malaysia (the financial consumer alert list) and the Securities Commission before putting money in. Do not use the children's savings, EPF or borrowed money. Decisions to invest family money should be made together. If you have already been cheated, make a police report at once. See Family finances.
Allah forbids consuming one another's wealth unjustly (an-Nisa' 4:29), and schemes that pay old investors with new investors' money fall under consuming wealth unjustly. Warning signs: high returns guaranteed with no risk; rewards for recruiting members; a company that is unregistered or unlicensed; pressure to decide quickly; and using a "Shariah-compliant" label or a religious figure's name to persuade. Check the company with Bank Negara Malaysia (the financial consumer alert list) and the Securities Commission before putting money in. Do not use the children's savings, EPF or borrowed money. Decisions to invest family money should be made together. If you have already been cheated, make a police report at once. See Family finances.
Sources
Surah an-Nisa' 4:29Surah al-Baqarah 2:188Surah al-Hujurat 49:6