Title: Warnings Against Pyramid Schemes Masquerading as Luholiswane in Swaziland: Exercise Caution Amidst Economic Hardships

Authorities Issue Stern Warnings

The Central Bank of Swaziland (CBE), Financial Services Regulatory Authority (FSRA), and Royal Swaziland Police Services (REPS) have issued stern warnings against the proliferation of pyramid schemes disguised as group savings schemes or ’luholiswane’ through social media platforms.

Distinguishing Pyramid Schemes from Legal Group Savings Schemes

Authorities have noticed a disturbing trend of pyramid schemes, which include “WhatsApp Gifting,” lacking the principles associated with legal group savings schemes as defined in the Consumer Credit Act of 2016. Instead, these schemes mirror pyramid schemes, which remain prohibited in Swaziland.

Dangers of Pyramid Schemes

The public is advised not to engage in pyramid schemes in any capacity (as promoters, members, or recruiters) as it goes against the law and may result in legal consequences.

Economic Hardships Increase Vulnerability

Swazilanders are currently facing economic hardships due to the COVID-19 pandemic, making them more susceptible to quick-money schemes. However, authorities emphasize that the business model of pyramid schemes is inherently unsustainable and can leave participants trapped in debt, ultimately leading to the collapse of the scheme.

Protecting Yourself from Pyramid Schemes

To avoid falling victim to pyramid schemes, the public is urged to:

• Double-check the authenticity of financial services providers
• Only participate in licensed entities
• Report any suspected pyramid schemes to the Royal Swaziland Police Services at 999 or 9999 ( guaranteeing confidentiality)
• Contact the Central Bank of Swaziland at 2408 2000 or the FSRA at 2406 8000 for enquiries regarding licensed financial entities

Be Aware and Exercise Due Diligence

As a reminder, ‘if it seems too good to be true, it probably is.’ So, let’s all stay vigilant and exercise due diligence. - Baleka!