Pyramid schemes targeting low-income earners in Rwanda

By Crispin Adriaanse Last updated May 25, 2021

The victims gave the scammers US$64,000, with the false expectation of substantial returns and fake assurances that they were joining a registered association supported by local authorities.

Close-up of a mouse trap — Victims of pyramid schemes were required to pay between US$100 and US$1000, with the promise of eight times their initial investment if they recruited eight new investors. File picture: Pixabay.

CAPE TOWN, May 25 (ANA) – The Rwanda National Police department (RNP) has issued a warning to the public about pyramid schemes targeted at the lower-income population, with some suspects having been apprehended while the alleged accountant is still on the loose.

In a statement on Sunday, Police Commissioner and spokesman John Bosco Kabera spoke about the prevalence of pyramid schemes which “lure especially small income earners”.

The latest incident occurred in the Rusizi district south of Lake Kivu and on the border between Burundi and the Democratic Republic of Congo where 200 women fell victim.

Victims were required to pay between US$100 and US$1,000 with the promise of eight times their initial investment if they recruited eight new investors.

The US-based Direct Selling Association (DSA) defines a pyramid scheme as the promise of large and substantial earnings with little effort except for recruiting others, and will always “charge large up-front fees to get involved, either as a direct payment or in the form of an obligatory payment”.

According to Rwandan law, fraud is defined as “deception, obtaining another person’s property, whole or part of his/her finance by use of false names or qualifications, or offering positive promises or threats of future misfortunes”.

The victims gave the scammers US$64,000, with the false expectation of substantial returns and fake assurances that they were joining a registered association supported by local authorities, the RNP statement said.

Commissioner Kabera said some of the extorted money had since been returned by some of the con artists, but police were still searching for Nadine Rugwiro, the alleged accountant of the illegal operation.

“We urge the public to be vigilant of such criminal minded groups and share information on those suspected to be engaged in such deceptive practices,” Kabera added.

– African News Agency, Editing by Stella Mapenzauswa