The Click Subscription Plan was determined to be a fraudulent Ponzi scheme, with the court ordering restitution of investments made by the Plaintiff due to false representations by the Defendants.

Mohd Arief Emran Arifin J:

A. Introduction

[1] The Plaintiff alleged that the Defendants defrauded him by promoting a false investment opportunity known as a "Click Subscription Plan" that was allegedly operated by the 1st Defendant and the 2nd Defendant.

[2] The Plaintiff now claims for the return of the monies that he had paid to the 1st Defendant through the 3rd, 4th and 5th Defendants and claimed that the 2nd Defendant also be made liable for the losses suffered by him.

B. Background Facts

Summary Of The Plaintiff's Claim

[3] The Plaintiff claimed that, on the invitation of the 3rd Defendant, he attended a meeting or seminar sometime in June 2017 held by the 1st Defendant regarding a "Click Subscription Plan" or scheme promoted by the 1st Defendant.

[4] The Plaintiff contended that the 1st, 2nd and 3rd Defendants represented the following to him:

(i) That the Click Subscription Plan is a business promoted by the 1st Defendant;

(ii) That the 1st Defendant and the Click Subscription Plan generate revenue by directing internet traffic to its client's websites;

(iii) That the business generates over 1 billion internet traffic for its clients;

(iv) That the capital invested in the Click Subscription Plan is guaranteed;

(v) That the returns on investment ("ROI") from the Click Subscription Plan was around 6300% achievable within 10 months; and

(vi) That investors can withdraw from the investment anytime without any form of charges and penalties through the portal known as Click DV.

("the said Representations ")

[5] Relying on the said Representations, the Plaintiff invested RM2,156,102.0 in the Click Subscription Plan from June 2017 to October 2017 ("the said Investment ").

[6] The sum of RM474,500.00 was paid in cash directly by the Plaintiff to the 1st Defendant, whilst the sum of RM483,500.00 was paid by way of 4 cheques to the 1st Defendant.

[7] On the instructions of the 3rd Defendant, the sum of RM1,010,602.0 was transferred to the 4th Defendant, who is the nephew and former employee of the 3rd Defendant, for the purpose of the said Investment.

[8] On the instruction of the 3rd Defendant, the sum of RM187,500.00 was paid to the 5th Defendant, who is the wife of the 3rd Defendant, also for the purpose of the said Investment.

[9] As the 3rd Defendant was declared a bankrupt at the time when the above transactions took place, the Plaintiff discontinued the action against the 3rd Defendant.

[10] The Plaintiff further contended that the 1st and 2nd Defendants knew that that the said Representations made to induce to him to invest were false. He claimed the following:

(i) that the 2nd Defendant was the Chief Executive Officer ("CEO") and co-founder of the 1st Defendant as well as the Click Subscription Plan;

(ii) that the 1st Defendant did not file any financial reports with the Companies Commission of Malaysia since its incorporation;

(iii) that the Click Subscription Plan was sustained only by new subscriptions and not from the business of generating internet traffic;

(iv) that the 1st Defendant did not generate sufficient revenue from the internet traffic generation;

(v) that the 1st Defendant needed continuous investments by subscribers to meet redemptions of investments and/or its claim for ROI;

(vi) that the representation on capital guaranteed was untrue and was fraudulently represented to the Plaintiff.

[11] Essentially, the Plaintiff claimed that the Click Subscription Plan was a Ponzi scheme and illegal under Malaysian law and that the 1st Defendant's business was conducted fraudulently contrary to s 540 of the Companies Act 2016 ("the CA 2016").

[12] The Plaintiff also claimed that the corporate veil of the 1st Defendant should be lifted and liability be imposed against the 2nd Defendant as he was the directing mind and will of the 1st Defendant and that the 1st Defendant was being used as a tool to commit fraud against the investors of the Click Subscription Plan promoted by the 1st and 2nd Defendants.

[13] The Plaintiff further claimed