Be­ware of scams

Don’t be lured by in­vest­ment op­por­tu­ni­ties that prom­ise big amounts of money in re­turn, warns Xoliswa Mh­laba

Move! Stokvel - - Contents -

BE­CAUSE of big amounts of money in­volved in a stokvel, scam­mers are al­ways try­ing to get their hands on this hard-earned cash. And if there was ever a time for stokvels to be care­ful, it is now. There are many scams that ei­ther pose as stokvels or tar­get stokvels. You and your stokvel need to ed­u­cate your­selves to avoid be­ing vic­tims.

PYRA­MID SCHEMES

Ac­cord­ing to fi­nan­cial ed­u­ca­tors, Busi Sken­jana and John Manyike, pyra­mid schemes are cur­rently the big­gest dan­ger to stokvels.

“At the mo­ment, there are pyra­mid schemes that are de­signed as stokvels. They prom­ise high re­turns and peo­ple are tempted to put some of their money there. This is a big risk,” says John, who is head of fi­nan­cial ed­u­ca­tion at Old Mu­tual.

These pyra­mid schemes en­cour­age you to re­cruit other peo­ple to join. The more you re­cruit, the bet­ter your re­turns. This can be tempt­ing for stokvel mem­bers who be­lieve that if they in­vest their money in these schemes, they will get big­ger prof­its for their stokvel.

Busi, who is the CEO of BSK Mar­ket­ing, ad­vises stokvels not to be lured by in­vest­ment op­por­tu­ni­ties that prom­ise big amounts of money in re­turn.

“Get-rich-quick schemes have never re­ally made any­one rich. They have only suc­ceeded in mak­ing peo­ple poorer,” she says.

WHAT­SAPP STOKVELS

There is a rise of so­cial me­dia stokvels, which can be dan­ger­ous. This in­volves de­posit­ing money into a stranger’s bank ac­count and all com­mu­ni­ca­tion is via a What­sapp group.

Ac­cord­ing to John, stokvels are founded on trust, so it’s im­por­tant to know the peo­ple you are in the stokvel with. This makes it easy to hold some­one ac­count­able.

With the What­sapp stokvels and other so­cial me­dia stokvels, peo­ple can dis­ap­pear with your money. Be care­ful be­fore get­ting your group in­volved in these kind of stokvels.

En­sure that ev­ery­one in a stokvel can be ac­counted for. Know where they stay and where they work so that you can be able to reach them in case of they have not paid what is due, or try­ing to scam the stokvel.

HIGH IN­TER­EST RATE IN­VEST­MENTS

Look out for in­vest­ment op­por­tu­ni­ties that prom­ise your stokvel high re­turns. The scam­mers even have so-called in­vestors who will give tes­ti­monies of high re­turns when they in­vested in the so-called project.

They can con­vince your stokvel to in­vest with them in­stead of putting money in the bank. In most cases, these in­vest­ment com­pa­nies col­lapse be­fore any money is paid out.

“Look out for any sav­ings scheme that prom­ises ex­tremely high in­ter­est rates,” says Busi.“if it sounds too good to be true, it prob­a­bly is. Bank in­ter­est rates might be lower, but they guar­an­tee that your in­vest­ment is safe.”

ARMED ROB­BERY

This tends to hap­pen to stokvels that phys­i­cally han­dle money. The stokvels are tar­geted on days when they col­lect or dis­trib­ute money. And in most cases, it is an in­side job. The rob­bers get a tip-off from some­one within the stokvel.

“This usu­ally hap­pens when there is a new­comer in the group or some­one who has not made a con­tri­bu­tion for a while. That is why it is im­por­tant for stokvels to be care­ful when they ap­prove new mem­bers,” says John.

Is your stokvel still col­lect­ing phys­i­cal cash from mem­bers? Well it is time to con­sider open­ing a bank ac­count. En­sure that all mem­bers de­posit their con­tri­bu­tion di­rectly to the bank. The must then bring proof of pay­ment to the monthly meet­ings.

DODGY SER­VICE PROVIDERS

John also en­cour­ages stokvels to be on the look­out for dodgy ser­vice providers. One of the com­mon scams for non-mon­e­tary stokvels is un­trust­wor­thy ser­vice providers.

John says what hap­pens within gro­cery or fur­ni­ture stokvels is that the hired trans­port dis­ap­pears with the goods.

This hap­pens a lot around De­cem­ber when it is time to buy and di­vide the gro­ceries. Groups end up los­ing all they have been sav­ing for through­out the year.

“Use peo­ple you know and that can be traced. Prefer­ably take some­one from your own com­mu­nity,” says John.

Bank in­ter­est rates might be lower, but they guar­an­tee that your in­vest­ment is safe

WHAT TO DO

Ac­cord­ing to John and Busi, once the money is gone the chances of get­ting it back are very slim. How­ever, it’s im­por­tant to open a case with the po­lice so they can pur­sue the per­pe­tra­tors. If you don’t es­ca­late the mat­ter by re­port­ing it, more peo­ple can fall vic­tim of the same scam­mers. Be safe!

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