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Monday, August 24, 2009 - 7.30 GMT |
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CB warns public
of pyramid schemes |
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The
Central
Bank of
Sri
Lanka
has
again
warned
the
public
to
refrain
from
participating
in
prohibited
pyramid
schemes.
This
warning
comes in
the make
of
regulations
into
several
major
frauds
perpetrated
on
investors
by
persons
and
companies
that
operated
"pyramid"
and
similar
investment
schemes.
Those
who
operate
pyramid
schemes
offer
interest
rates to
investors
that are
much
higher
than
recently
notes in
bounds,
and
other
financial
institutions
regulated
by the
CBSL.
According
to the
Central
Bank,
these
schemes
call
upon
participants
to pay
money to
purchase
products
or
services
when the
participants
sign up
to join.
The
public
is
advised
that
pyramid
schemes
are
illegal
under
section
83 of
the
Banking
Act and
such
transactions
are
offenses
liable
under
the
exchange
control
act and
the
prevention
of money
laundering
act.
Therefore,
any
person
found
guilty
of
participating
in such
schemes
will be
subjected
to a
term of
imprisonment
not
exceeding
three
years, a
fine of
rupees
one
million
or both.
The
offender
shall
face
imprisonment
for a
term
between
three to
five
years, a
fine of
Rs.2
million
or
double
the
amount
of
currency
used in
the
prohibited
scheme
in the
value of
the
Lankan
currency.
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