The National Stokvel Association has urged South Africans to be weary of short term investment schemes promising high returns.
It says the latest WhatsApp Stokvel doing the rounds on social media is nothing more than a pyramid scheme.
The scam invites people to invest as little as R200.
“What is playing out is a pyramid scheme as people are invited to join. In a genuine stokvel people don’t just join, they form a stokvel so they know the rules of the stokvel from the inception. A pyramid scheme is a setup where people are promised high returns on their investment at a very short period of time. So a pyramid scheme invites people to put money to benefit a few people. Stokvels have been there for many years, we have over 11 million people who participate in stokvels so there is a proven record of success in this concept. The new stokvels are confusing the multitudes of people and doesn’t fulfill its purpose,” says National Stokvel Association of South Africa’s Andrew Lukhele.
The Financial Sector Conduct Authority couldn’t comment on the Whatsapp money-making scheme as it has yet to determine who has jurisdiction over the matter.
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