Pyramid schemes and online scams on rise, authorities caution people

Recent news on pyramid schemes and multiple online scams have left individuals realising that there is no easy money. A new scheme known as Enveer is now under the Competition and Consumer Affairs Authority’s radar. The authority is investigating the Enveer scheme and said that seven similar pyramid schemes have been recorded so far. The Royal Bhutan Police, on the other hand, has registered over 150 online scams in the past four years.

In a pyramid scheme, people make money by recruiting new members rather than by buying and selling goods and services like usual businesses. The Competition and Consumer Affairs Authority say pyramid schemes are the most common scams in the country.

The authority investigated nine alleged pyramid schemes, so far, seven were found to be pyramid schemes and were banned from operation in the country.

The Competition and Consumer Affairs Authority says that in most cases, scams such as pyramid schemes are hard to detect as they operate discreetly and target vulnerable groups of people such as farmers, housewives, students, monks, and illiterate people.

As such, the office said that by the time the investigation is complete, people have already fallen victim.

“Last year, it was said that if we invest Nu 2,700 we will earn a profit of Nu 12,000 and Nu 100,000. So, I invested Nu 2,700 and later my wife also invested Nu 2,700. They said that if we recruit more people we will get USD 13. But nothing came out of it. Just recently, I was asked to give my passport and CID details saying that they would return 2,700 and nothing has been given to us,” said Thupten Wangchuk, a resident of Thimphu.

“I have never participated in this. But some of my friends said that if we invest Nu 30,000 and also recruit four friends we can get profit from it. However, later I saw them getting nothing out of it. They did not even get refunds,” said Thinley Dorji, another resident of Thimphu.

“I am mining Pi and many people I met said that we get money after we mine Pi. Some even say that we can use Pi as we buy things in shops. However, I have never seen anyone doing it. I keep on mining Pi. Some also advertised that one can buy things using mined Pi but I do not for sure if it is true,” said Cheki Wangchuk, also a resident of Thimphu.

Meanwhile, the Royal Monetary Authority said that such scams often happen due to individual negligence and that even educated people fall victim.

The central bank is requesting everyone to validate information to avoid getting scammed. This year alone saw 66 cases of online scams reported to the police, the highest so far.

The Competition and Consumer Affairs Authority said that it is both easy and cost-effective to start an e-commerce business. This has led to an increasing number of registered and unregistered e-commerce businesses. As a result, incidences of online scams are common and are expected to grow.

Sonam Yuden

Edited by Sherub Dorji

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