Press Statement: SIAS Warns Investors Against “Nanning”-Type Investment Schemes

Date: September 4, 2026

The Securities Investors Association (Singapore), or SIAS, wishes to caution members of the investing public against participating in investment arrangements commonly referred to as the “Nanning Scheme” or similar schemes promising exceptionally high returns with low risk through recruitment of new participants.

Reports concerning such arrangements describe investors being introduced to supposedly exclusive investment opportunities overseas, sometimes accompanied by claims that the promoters are connected secretly to government officials on these opportunities and are associated with government-backed projects or economic development programmes. Investors should also beware that scammers can impersonate government officials by using sophisticated tools such as AI.

Potential participants may also be invited to travel to overseas countries such as China to hear presentations and meet existing investors.

SIAS strongly urges investors to exercise extreme caution simply because one of the most important principles of investing is:

if an investment opportunity sounds too good to be true, it probably is, and more often than not, it is likely to be a scam.

Investors should be particularly suspicious when an investment promises extraordinary or virtually guaranteed returns, when its precise underlying business cannot be independently verified, or when participants are encouraged to recruit friends, relatives and acquaintances in order to earn unusually high commissions or advance through different levels of an organization.

The fact that a scheme has supposedly operated for many years does not necessarily establish that it is legitimate. Neither does the fact that some participants may initially have received payments, because one of the defining characteristics of Ponzi and pyramid-type arrangements is that early participants may receive money funded by later participants.

Such payments can create the impression that an investment is genuine and encourage existing members to introduce others. Such an arrangement becomes unsustainable when the flow of new money slows or stops and the entire pyramid structure collapses.

Investors should also be extremely wary of claims that an opportunity is connected to a government agency or major national development project but is somehow available only to a privileged group of individuals.

A genuine government-backed investment should be capable of independent verification through official channels. Investors should never accept photographs, presentations, documents, testimonials or statements made by recruiters as sufficient proof.

SIAS is particularly concerned when recruitment takes place through personal relationships. Investors naturally place greater trust in friends, colleagues and family members.

However, the person recommending the investment may himself genuinely believe in the scheme and may not realize that he has become part of the mechanism through which new participants are recruited. Remember:

Friendship is not due diligence!

Before transferring any money, investors should ask these basic questions:

• What exactly am I investing in?
• Who holds my money?
• Where are the audited financial statements?
• Who regulates the investment?
• How are the promised returns generated?
• Can I withdraw my investment freely?
• And why am I being rewarded for recruiting other investors?

 

If satisfactory and independently verifiable answers are not available, investors should walk away and not stay because they are tempted by high returns.

There will always be schemes promising exceptional wealth with seemingly little risk. Names, locations and sales pitches may change, but the underlying warnings remain the same:

High returns invariably come with high risks. There is no secret investment formula that can generate enormous, guaranteed profits indefinitely. Investors must be educated and knowledgeable about investments to make informed decisions and not be in a hurry to part with their money. Investors should investigate first, verify independently and never allow greed, secrecy, friendship or pressure to override common sense. Investors must always ask, check and confirm before parting with their money.

 

David Gerald
For the Management Committee
Securities Investors Association (Singapore) (SIAS)