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RMA cautions people against ponzi schemes.

The Royal MonetaryAuthority of Bhutan(RMA) has cautioned theBhutanese public fromparticipating in ponzi orpyramid schemes.Such practices are not only deceiving, but are alsoillegal, according to theRMA.This notification,according to the RMA,was made after it hadcome to RMA`s notice thatBhutanese citizens arebeing lured to participatein Pyramid/Ponzi Schemes (Crypto-Builder/ Nobel8Revolution) via socialmedia with promises oflarge financial returns.'The essential featureof such schemes is thatthe investment madeby member is used forgenerating returns forolder investors with a large part of the investmentremitted to the parentcompany.

Therefore, suchschemes will be sustainableonly so long as the numberof participants keepsgrowing exponentially,'states the RMA governor,Dasho Penjore in thepublic notification. He added, 'Hencethe term pyramid usedas the base must keepon expanding to ensurea return to earlierparticipants. However, sincethere is only finite numberof potential participants,the schemes are boundto collapse when it is nolonger able to attractnew participants to theschemes.'The governor alsoreminded the people torecall an investment scamprevalent in eastern Bhutanfew years ago, where highproportion of populationlost their entire savings.

According to the RMA,the notification is issuedgiven the inherent andundesirable nature of suchschemes and in orderto protect unsuspectingcitizens from sufferinglarge-scale losses.Meanwhile, theRMA has also cautionedorganizers of such schemesto refrain from operatingsuch schemes within theKingdom of Bhutan.It states that anyonefound participating/facilitating such schemesin whatever manner shallbe liable for prosecutionunder the Laws of theKingdom of Bhutan.

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Publication:Business Bhutan (Thimphu, Bhutan)
Date:Sep 8, 2018
Words:260
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