Malaysia Targets Big Social Platforms as Online Investment Scams Spiral

Malaysia is moving to clamp down on major social media and messaging platforms as online scams and investment fraud continue to surge across digital channels. From January 1, 2026, platforms with eight million or more users in Malaysia will be automatically deemed licensed under national law, placing them directly under regulatory oversight. Lawmakers say the move closes a long standing gap that has allowed high risk financial content and criminal networks to operate at scale with little accountability.

Supporters of the Deeming Provision argue that messaging apps and social networks have become the primary distribution channels for fake trading platforms, crypto fraud, impersonation schemes, and recovery scams. These platforms influence financial decisions, host investment pitches, and monetise local users, yet have remained largely shielded from responsibility when fraud spreads.

Members of Parliament backing the measure stressed that this is not an attempt to restrict social media, but to force global platforms to meet basic standards of user safety. Regulators will gain clearer authority to demand cooperation, content controls, and action against accounts promoting scams, illegal investments, and harmful financial schemes.

The Malaysian Communications and Multimedia Commission will oversee enforcement, with an emphasis on protecting children and retail users who are frequently targeted by online trading fraud and get rich quick schemes. The move also supports future restrictions on social media access for minors, a group increasingly exposed to financial manipulation.

Lawmakers acknowledged the risks of regulatory overreach and called for transparency, appeal mechanisms, and strong checks and balances. They warned that enforcement must be firm but lawful, especially given the power such rules confer.