People fall victim to illegal pyramid selling schemes and cryptocurrency trade

The Financial Intelligence Unit is warning members of the public to exercise extreme caution and not engage in any cryptocurrency trade or pyramid selling schemes after several reports of people depositing money into the bank accounts of the suspected entities.

Last month, the FIU identified more than 150 potential victims of the alleged illegal scheme who conducted over 300 deposit transactions totalling approximately $9,000 into one active subscriber’s local mobile money wallet.

It was also established that the active subscriber received two suspicious cash deposits of $10,000 each in 2019 and 2020, and received suspicious remittances over $80,000 from 2018 to 2021 into her bank account.

An entity was reported for engaging in possible unregulated trading of bitcoins whereby a group of people were promoting such trade on social media and online platforms.

FIU Director, Razim Buksh says interested “investors” were provided with the entity’s bank account details and instructed to note the first and last four alphabets/numbers of their bitcoin wallets as the transaction narration when depositing funds for their acquisition of bitcoins.

Another entity was reported for possible unregulated trading of cryptocurrencies following an attempted remittance transaction for the acquisition of digital goods in Australia.

It was established that over 20 suspicious deposits totalling approximately $8,300 were made into the reported entity’s bank account within two months.

The owner of the second reported entity was also brought to the attention of the FIU for promoting a potential illegal multi-level marketing scheme, a type of pyramid selling scheme.

Buksh says the scheme had been designed to appear as a business model that provides educational programmes on financial trading and market analysis, and customers pay a monthly subscription fee of $99.

He adds that subscribers can receive commission from the illegal pyramid selling scheme if they get other individuals to subscribe to the scheme’s programmes.

Another illegal pyramid selling scheme was reported, which promised easy and high returns for subscriptions as low as $2.

Buksh says these scams involving cryptocurrency trading and pyramid schemes need further scrutiny. For pyramid schemes, the focus is mainly on increasing the number of subscribed users/members/customers rather than the quality and/or usefulness of products/services offered.

Under the Fijian Competition and Consumer Commission Act 2010, it is an offence for a person to be a promoter or operator of a pyramid selling scheme.

Members of the public may also report any fraudulent or suspicious transactions to the FIU on 322 3333 or email: info@fijifiu.gov.fj.