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Kampala, Uganda | THE INDEPENDENT | Parliament has passed a resolution asking the government to ban all Ponzi and Pyramid schemes.
According to an earlier statement by the Central Bank, Ponzi or Pyramid schemes were described as fraudulent investing scams promising high rates of return with little risk to investors. The Central Bank warned the public against investing in businesses which sound ‘too good to be true.
During Thursday’s plenary session chaired by Deputy Speaker Jacob Oulanyah, Western Youth MP Mwine Mpaka presented a motion seeking the ban of Ponzi and Pyramid schemes saying they have left several unsuspecting Ugandans in debt.
Mpaka’s motion was seconded by Gomba Woman MP Sylvia Nayebare. He said that despite several warnings to the public by BOU against such schemes, several fraudulent schemes continue to spring up hence a need to ban them.
Gomba Woman MP Sylvia Nayebare also supported the motion to ban Ponzi and Pyramid schemes saying that innocent Ugandans are taken advantage of and robbed.
Kampala Central MP Muhammad Nsereko supported the ban of all Ponzi and Pyramid schemes but advised that this should be done lawfully. He adds that even banks that defraud clients should be closed.
Lydia Chekwel, the Kween Woman MP said that she was one time excited by a Pyramid scheme and recruited her husband, however, she was defrauded to the extent of failure to pay children’s school fees.
Ayivu County MP Benard Atiku who has fallen victim, says that the schemes are dangerous since they have affected business and others sold off assets.
West Budama South MP Jacob Oboth says that government has no legal framework to regulate Ponzi and pyramid schemes. He adds that regulation for cyberspace in Uganda is still wanting amidst a rise in cryptocurrencies trading online.
Ethics Minister Fr. Simon Lokodo also supported the motion to ban the schemes saying that even several MPs are involved in schemes, which tarnishes the image of the institution.
State Minister for Finance in charge of Planning David Bahati cautioned Ugandans not to get involved in schemes. He pledged government’s commitment to take action.
Last year, more than 3,000 people, including senior police officers, had been ripped off of their savings they had deposited in Global Finance, a pyramid scheme after it closed and directors went in hiding. More than 100 officers attached to the Police Band had each invested a minimum of 4.5 million Shillings in the pyramid scheme with hope to get 15 percent interest a month.
Last week, the Nakawa Deputy Resident City Commissioner Herbert Anderson Burora closed Development Channel, a Ponzi scheme that had recently hit Kampala, over allegations of defrauding Ugandans.
Its Director Charles Lambert, a dual citizen of Britain and Nigeria, was also re-arrested
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