What is SIDREC and how can it help investors?

SIDREC is an independent body set up by the Securities Commission Malaysia to resolve money disputes between investors and capital market firms. For claims up to RM250,000 against a SIDREC Member, its service is free to investors.

What SIDREC is

The Securities Industry Dispute Resolution Center (SIDREC) is an independent and impartial body that resolves capital market disputes in Malaysia. It was established by the Securities Commission Malaysia (SC).

SIDREC uses mediation and adjudication. It gives investors an option other than going to court.

It handles monetary claims by individual investors or sole proprietors against its Members. The claim must relate to a dealing or transaction involving capital market products or services in Malaysia.

Who the Members are

SIDREC Members hold a Capital Markets and Services Licence or are Registered Persons under the Capital Markets and Services Act 2007.

They include investment banks, commercial and Islamic banks, stockbrokers, derivatives brokers, fund management companies, unit trust management companies, unit trust advisers, and Private Retirement Scheme providers and distributors.

SIDREC had 205 Members as of 19 December 2024. Its website lists them by name at sidrec.com.my/sidrec-members. Some entries show a former name in brackets, so check the old name too.

Commercial and Islamic banks that offer capital market products joined SIDREC in September 2016. Before that, these disputes were referred to the Financial Mediation Bureau.

When SIDREC can take your case

Under SIDREC's Mandatory Scheme, a Member must take part when four conditions are met. The dispute is against a SIDREC Member. The claimant is an individual investor or a sole proprietor. It involves a capital market product or service bought from or offered by the Member or its representative. The claim does not exceed RM250,000.

The Mandatory Scheme is free to the investor.

Claims above RM250,000 fall under the Voluntary Scheme. SIDREC accepts these only if both sides agree, and both pay a fee.

SIDREC deals with money disputes only, so your complaint must include a monetary claim.

How to file a complaint

First, complain to the firm itself. Keep copies of your complaint letter, the firm's final reply, account opening forms, any written agreement and other messages.

If the firm has not responded for more than 90 days, you can go to SIDREC directly. If you are unhappy with the firm's reply, you have 180 days from receiving it to file with SIDREC.

Download the Dispute/Claim Form in English or Bahasa Malaysia from sidrec.com.my/lodge-a-complaint. You can email it to info@sidrec.com.my, post it, or hand it in at SIDREC's office in Kuala Lumpur.

According to the SC's FAQ on SIDREC, an adjudication decision is final and binding on the Member. An investor who does not accept it may still pursue the complaint in other ways, such as the courts.

Why checking the firm first matters

SIDREC only handles disputes against its Members, which are licensed or registered with the SC. A platform that is not on the Members list falls outside SIDREC's scheme.

So check a firm before you deal with it. Look it up at sc.com.my/investment-checker and on the SC Investor Alert List, and compare its name with the SIDREC Members list. SmartChecker also shows register records and reviews for the companies it lists.

Common questions

Does SIDREC charge investors? Not under the Mandatory Scheme, which covers claims up to RM250,000. Claims above that go to the Voluntary Scheme, where both sides pay a fee.

Can a company file a claim with SIDREC? The Mandatory Scheme is for individual investors and sole proprietors.

Is SIDREC part of the SC? SIDREC was established by the SC, but it describes itself as an independent and impartial body.

Do I have to complain to the firm first? Yes. You must lodge a complaint with the Member before going to SIDREC.