RMA cau­tions peo­ple against ponzi schemes

Business Bhutan - - Business - Yen­ten Thin­ley from Thim­phu

The Royal Mon­e­tary Au­thor­ity of Bhutan (RMA) has cau­tioned the Bhutanese pub­lic from par­tic­i­pat­ing in ponzi or pyra­mid schemes.

Such prac­tices are not only de­ceiv­ing, but are also il­le­gal, ac­cord­ing to the RMA.

This no­ti­fi­ca­tion, ac­cord­ing to the RMA, was made af­ter it had come to RMA`s no­tice that Bhutanese cit­i­zens are be­ing lured to par­tic­i­pate in Pyra­mid/Ponzi Schemes (Crypto-Builder/ No­bel8 Rev­o­lu­tion) via so­cial me­dia with prom­ises of large fi­nan­cial re­turns.

“The es­sen­tial fea­ture of such schemes is that the in­vest­ment made by mem­ber is used for gen­er­at­ing re­turns for older in­vestors with a large part of the in­vest­ment re­mit­ted to the par­ent com­pany. There­fore, such schemes will be sus­tain­able only so long as the num­ber of par­tic­i­pants keeps grow­ing ex­po­nen­tially,” states the RMA gover­nor, Dasho Pen­jore in the pub­lic no­ti­fi­ca­tion.

He added, “Hence the term pyra­mid used as the base must keep on ex­pand­ing to en­sure a re­turn to ear­lier par­tic­i­pants. How­ever, since there is only fi­nite num­ber of po­ten­tial par­tic­i­pants, the schemes are bound to col­lapse when it is no longer able to at­tract new par­tic­i­pants to the schemes.”

The gover­nor also re­minded the peo­ple to re­call an in­vest­ment scam preva­lent in eastern Bhutan few years ago, where high pro­por­tion of pop­u­la­tion lost their en­tire savings.

Ac­cord­ing to the RMA, the no­ti­fi­ca­tion is is­sued given the in­her­ent and un­de­sir­able na­ture of such schemes and in or­der to pro­tect un­sus­pect­ing cit­i­zens from suf­fer­ing large-scale losses.

Mean­while, the RMA has also cau­tioned or­ga­niz­ers of such schemes to re­frain from op­er­at­ing such schemes within the King­dom of Bhutan.

It states that any­one found par­tic­i­pat­ing/ fa­cil­i­tat­ing such schemes in what­ever man­ner shall be li­able for pros­e­cu­tion un­der the Laws of the King­dom of Bhutan.

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