In yet another high-profile crypto scam, thousands of Ugandans have been fleeced of their investments numbering into billions by the Global Cryptocurrency Limited company.
Over 100 people have filed complaints with the police accusing the company of fleecing them billions of shillings.
The one-year pyramid scam has resulted in thousands of Ugandans, including a UPDF colonel, senior army officer, and bank employees, losing huge investments.
Investors were asked to deposit between 100, 000 ($27) to 10 million Ugandan Shillings ($2, 700) with an interest return of 40% after 30 working days.
Global Cryptocurrency Limited was passing off as a forex trading company and as an oil company that makes 100% profits while giving back 40% to investors.
The company employees were asked to recruit family members, relatives, and village mates in addition to themselves also investing small amounts. Every recruit would further recruit someone else and the process would continue.
All recruits were asked to register before they could get their 30-day returns.
According to one of the victims of the scam, the company required recruits to register using either their ID, driving permit, work ID or Passport. After that they would be given either a StanBic or Centenary Bank account to deposit the money where the interest would be paid out.
One pastor recruit is said to have invested over 70 million Uganda Shillings ($1, 900) and convinced other church members to invest a total of 270 million ($7, 300).
Centenary Bank employees are also claimed to have joined the initiative with managers, tellers, and supervisors being some of the scam victims.
The company was able to pass off as genuine since investors would pay directly to the bank and get a bank slip that would be presented to the company offices. This process created confidence making the company look genuine.
The company account is claimed to have had not less than 10 billion Ugandan shillings ($2.7m) which disappeared following the arrest of one of the company directors.
This is one of the latest in crypto scams that have been experienced in Uganda despite the unpopular warning put out by the Ministry of Finance, Uganda, to be wary of such scams. A similar scam, the DunamisCoin scam, saw millions in investment lost in the town of Masaka, Uganda.
Another cryptocurrency scam is also reported to have led a Makerere University student to commit suicide after losing $5, 000.
Earlier this year, Velox 10 Global, also similarly defrauded Kenyans in millions of Kenya shillings after the company closed operations in the country.
Following these incidences, SiBAN, a self regulatory authority in Nigeria, has set up a crypto scam alert service that allows the public to report of suspected scams and learn how to avoid becoming victims.
The Blockchain Association of Uganda is also putting out material and videos to help educate Ugandans on how to spot genuine and fake cryptocurrency investment opportunities in the wake of these recent scams.
To enable Ugandans better understand cryptocurrencies, we will continue to educate & inform the public. This video helps differentiate between cryptocurrencies, ponzi and pyramid schemes.@mofpedU @BOU_Official @SydneyAsubo @4IRUganda @newvisionwirehttps://t.co/g4I2IVm8gI
— Blockchain Association UG (@blockchainug) December 8, 2019