Net tightens on pyramid schemes fraud

A task force probing shadowy pyramid schemes in which Kenyans were duped of millions of shillings on Tuesday said it will auction property owned by the masterminds to recover the money.

Task force chairman Francis Nyenze said his team would sell properties identified as belonging to those behind the scams.

“We have asked pyramid scheme victims to register with district cooperative officers for them to be reimbursed when the money is recovered,” said Mr Nyenze.

Addressing victims of the scam in Mombasa, Mr Nyenze urged them to supply names of the pyramid masterminds to his task force.

Coast Provincial Cooperative Officer Ezekiel Moywaywa said more than 3,000 victims have registered, adding that most lost amounts ranging from Sh50,000 to Sh2 million.

Coming forward

“In Kilifi and Mombasa districts, the pyramid scheme victims lost more than Sh30 million with Kilifi alone accounting for more than Sh20 million and we expect the number to grow as more are coming forward,” said Mr Moywaywa.

The PCO appealed to the public to present their cases to the task force which will tour Malindi, Kilifi and Lamu to establish the number of pyramids.

Mr Moywaywa named some of the pyramids which conned the public as Deci, Jitegemee self-help group and Pesa net.

“Some of the pyramids were issued with certificates after they registered as cooperative societies,” he said.

Investment analysts have warned against the dangers of the pyramid schemes re-emerging because of the financial crunch and the advent of e-finance.

Expected to rise

Mr Joseph Nyagah, a certified securities and investment analyst told the Nation that fraudulent activities were expected to rise and urged the public to resist the temptation of making a quick buck.

“The introduction of electronic money transfers might give birth to more scams of this kind and people need to be more careful when transacting business,” said Mr Nyagah.

He said there was need to launch a public awareness campaign on different kinds of fraud.