A Rwandan businessman has been detained over allegations of engaging in crypto currency scam, the Rwanda Investigation Bureau (RIB) said on Saturday, leaving some 6000 people crying foul after being extorted of their money in multi-level marketing business now closed in Kigali.
Rwanda Investigation Bureau has arrested Jean Bosco Nsengiyumva, the manager of Supermarketings Global Ltd over investment scam activities, specifically crypto currency scam, it said in a statement.
“The company strategies are misleading and confusing, attempting to make people believe that they can invest little money and earn exceedingly but end up losing and realize that they are dealing with swindlers,” RIB Spokesperson, Modeste Mbabazi said.
According to RIB, Supermarketings Global Ltd company encouraged its members to pay a fee starting from $30 for an opportunity to sign up other members then earn commissions ranging between 2.5 percent and 10 percent.
The firm had extorted 5 million Rwandan francs from around 6,000 members in Rwanda, in the last one month of the illegal business, it said.
Supermarketings Global Ltd business model is comparable to multi-level marketing (MLM) which is considered risky since it is similar pyramid schemes, it added.
Under Rwandan laws on illegal operations of currency sale or exchange, any person who, by any means, illegally sells or exchanges, national or foreign currency, commits an offence.
RIB appealed to the public to be vigilant and to report any suspicious currency sale or exchange businesses that promise quick return on investment.
The arrest came hardly a day after the National Bank of Rwanda warned the public against pyramid schemes and network marketing in the country.
The National Bank of Rwanda will not safeguard any person who invests in pyramid schemes or any other related activities, it said in a Thursday notice to the public.
The notice said the National Bank of Rwanda has been alerted of the existence of “investment scam activities operating in Rwanda through locally registered businesses or from abroad through online platforms.”
The central bank said the scams take the form of active pyramid schemes, pyramid scheme, multiple level marketing or crypto currency issuance through fake initial coin offerings.
Some of the examples of such schemes which have come to the bank’s attention cited include Supermarketings Global Ltd, whose leader was arrested on Friday, 3 Friends System (3FS) Group Ltd, Onecoin or Kwakoo (OnyxCoin) among others.