Continuing its campaign against pyramid schemes, Central Bank is again warning the public that persons who buy a product, not for its own sake but expecting future returns from getting more enter the scheme, are not engaging in a simple trade transaction but a different type of game.
“As the expectation of future returns is based purely on the expected expansion in the number of participants, the operation acquires the characteristics of a pyramid scheme, giving rise to the risks explained in the Central Banks recent press notices,” the Central Bank said.rn
rn”The collapse of a large pyramid scheme could affect the economy of a country in general, and its financial sector in particular if the scheme is financed by participants using money borrowed from financial institutions.”rn
rnThe full text of the release appears below:rn
rnNOTICE TO THE PUBLIC ON PYRAMID SCHEMESrn
rnThe Central Bank wishes to invite the attention of the public to its press notices published recently in newspapers