Crime allegations challenge Forest City’s effort to rebuild its reputation
Malaysia’s Forest City is trying to attract investment through a special financial zone, but police raids on alleged scam operations and the closure of a technology community have increased concerns among residents, property owners and experts. The development has also recorded weak prices and few transactions.
Malaysia’s Forest City is facing renewed reputational challenges as it attempts to reinvent itself as an investment destination after police raids on alleged online scam operations and the closure of a technology community. Johor police arrested 335 people in July during raids on suspected scam centres in the development. Police seized computers and mobile phones and said the alleged schemes included fraudulent cryptocurrency investments and romance scams targeting people overseas.
The authorities also ordered Network School, a community for technology entrepreneurs and digital nomads, to stop operating after finding breaches of licensing conditions and approved premises use. Although the episode was not described as criminal activity, residents and property experts said it damaged Forest City’s image. The development is being promoted as an investment destination anchored by its special financial zone.
The zone is expected to exceed its two billion ringgit investment target this year after receiving more than 250 inquiries from potential investors, including financial institutions, family offices and business-services firms. Criminologist P Sundramoorthy of Universiti Sains Malaysia said the alleged scams and licensing controversy could affect property values, business confidence, tourism and investment decisions. He said vacant residential and commercial units could make the development attractive to illicit operators because premises could be rented without immediately drawing attention.
Residents have responded with additional security measures. Muhammad Aidi Rashid, a tenant, said he installed cameras and extra locks after hearing about suspected scam operations in nearby blocks. Property agent Aqil Amran said his company found alleged scam-related equipment in a rented unit and ended the tenancy.
Property data cited in the report showed a median transaction price of 547 ringgit per square foot between June 2025 and June 2026, down 12 per cent year on year. Only 13 sales were recorded during that period, although experts cautioned that the data lagged and did not establish that later controversies caused the absence of transactions.
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