By Staff Writer
Warning drums against Pyramid Schemes stealing from innocent victims is beating louder with the Ministry of Commerce Industry and Labour booming drums joining in.
“”Be very careful with these type of offers, because often they are too good to be true and will just end up costing you money,” MCIL drums roared in a press release.
“Don’t let family lose big in pyramid scheme scams.”
The Ministry warning echoed earlier concerns raised by the Central Bank over similar reports of pyramid selling and similar schemes currently operating in Samoa.
These money scams are not new to Samoa and the new twist with this latest addition is the gifting and re-gifting of money in addition to the recruitment of participants to produce financial rewards.
Pyramid selling and similar schemes are illegal ‘get rich quick’ scams that can end up costing your friends and family their hard-earned tala,” the MCIL statement warned.
“ Pyramid selling and similar schemes promise financial returns to participants should they add more membership to the scheme.
“New participants must register with high upfront membership fees. Participants are promised to earn from the operation of these schemes high financial returns very quickly.”
The Ministry warned that ‘pyramid selling and similar schemes are prohibited in Samoa under section 65 of the Competition and Consumer Act (“CCA”) 2016 administered by the Ministry of Commerce Industry and Labour.
Section 65 of the CCA 2016 makes it illegal to promote and participate in Pyramid selling and similar schemes where it says that:
1.A person must not promote or operate a scheme for the supply of goods or services for reward if:
(a) to many participants in the scheme, the scheme constitutes primarily an opportunity to buy or sell an investment opportunity, whether personally or through an agent, rather than an opportunity to buy or supply goods or services; and
(b) the scheme is or is likely to be unfair to many of the participants in the scheme in that –
(i) the financial rewards for many of those participants are dependent on the recruitment of additional participants (whether or not at successively lower levels); and
(ii) the number of additional participants in the scheme that must be recruited to produce reasonable financial rewards to participants in the scheme is not attainable or is not likely to be attainable by many of the participants.
