Fraud and Security Consultant, Richard Kumadoe has outlined certain factors to consider when investing into any scheme in order to avoid fraudulent or Ponzi schemes.
His advice comes at the back of the warning by the Securities and Exchange Commission (SEC) to the general public to desist from investing with investment firm, Chy Century Heng Yue Group Limited and its partner, Sairui E-commerce Ghana Limited.
In an interview with Samuel Eshun on the Happy Morning Show, he identified that certain characteristics of a Ponzi scheme include an abnormally high returns on investments, anonymous third parties, the need for more investors, and the terribly attractive nature of the investments.
“Ponzi scheme is any scheme that is fraudulent and packaged nicely to appeal to the eyes of the people. They promise high returns on investments. So anytime you want to invest in anything and the rate of return is high you need to slow down. If you don’t know who is behind the scheme, you slow down. These are known as third parties. When the saturation point is getting closer, and payment is becoming a bit of a problem you need to slow down but one of the things that happen with all these Ponzi schemes or the pyramid scheme is that the risk is high, it is so fast and so packaged that not many people see through it”, he shared.
Richard Kumadoe furthered that before people involve themselves in any kind of investment scheme, they must consult “due diligence officers” to ensure that the scheme is clean. He noted that Ponzi schemes have a particular pattern and even though one may be naïve or not exposed to the technicalities, due diligence can always be done to avoid “handing your family property over to a man whose grandparents you don’t know”.
The Securities and Exchange Commission (SEC) has warned the general and investing public to beware of investment firm, Chy Century Heng Yue Group Limited and its partner, Sairui E-commerce Ghana Limited that has been undertaking electronic investments transactions.
According to the capital market regulator, it has not licensed the firm to carry out any capital market activity including investing or trading for returns as mandated by Section 3 of the Securities Industry Act.
As such, Chy Century Heng Yue Group Limited, cannot operate as an investment firm.
By: Alberta Dorcas N D Armah