National Bank warns consumers about pyramid fraud



The consumer must judge the consumer.

23. Aug. 2018 at 13:38 TASR

BRATISLAVA. Consumers must be careful when they attract investments with incredibly high returns.

If they want to know more about the investment opportunity and the company is willing to provide the information only if they pay a contribution, an initial investment or a recommendation to its acquaintances, it can be a pyramid fraud.

The National Bank of Slovakia (NBS) warns against such practices.


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Big profit is suspicious

People must be careful if the investment offer promises too much.



Read also: The non-bank owner promised an annual return of 48%. They have condemned her for fraud

"Be careful and consider whether the promised profit can be real, look on the internet, what revenue you can achieve in the competition, and whether the valuation is unrealistic, and pay attention to the promised guaranteed return," he advises the regulator.

It is good if the consumer always checks whether the entity is under the supervision of the NBS and whether he has a license to do business in that area. This can be done on the website of the National Bank, which also publishes alerts.

"A warning signal can be the head office of a company that offers its services exclusively via the internet, with its registered office in the tax haven or outside the European Union, check that consumers in the forums do not complain to this company, or that consumers do not to lose money longer, "he suggests to the NBS.

How Pyramid Games work

Pyramid schemes work according to the principle that the money that the man invests must be paid mainly to those who have placed the money earlier and are waiting for the investment that is valued.

"A large part serves to make a profit, so it works until there is money to pay or there are no new investors to find and the pyramid clamps," explains the National Bank.

If a consumer has fallen victim to such a pyramid, he has several options to help. It is necessary to contact the police or the public prosecutor directly and also to inform the NBS itself. "The National Bank cooperates with law enforcement agencies, even though the NBS does not have the right to recover money, but it can issue warnings to help other consumers", added the NBS.

What to pay attention to?



Read also: Year 2002: Tens of thousands of people lost savings in non-banknotes

The regulator recommends that consumers never conclude a contract for a financial product or financial service, such as a loan, insurance, investment, savings product, savings, or through an entity that is authorized to do so.

In addition, they have to consider whether they are prepared to take the risk of losing all the money that is deposited when they invest through an unknown company.

People also need plenty of time to think. "The serious consumer business is not rushing", warned the NBS and said that such investments are not covered by the Investment Fund. For example, if the company ceases to exist, it is unlikely that someone will ever get their money.

"To pay more attention to products and services that are not controlled by the NBS, such as virtual currencies, crowdfunding, P2P loans," the NBS added.


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National Bank warns consumers about pyramid fraud



The consumer must judge the consumer.

23. Aug. 2018 at 13:38 TASR

BRATISLAVA. Consumers must be careful when they attract investments with incredibly high returns.

If they want to know more about the investment opportunity and the company is willing to provide the information only if they pay a contribution, an initial investment or a recommendation to its acquaintances, it can be a pyramid fraud.

The National Bank of Slovakia (NBS) warns against such practices.


Article continues under video ads

Big profit is suspicious

People must be careful if the investment offer promises too much.



Read also: The non-bank owner promised an annual return of 48%. They have condemned her for fraud

"Be careful and consider whether the promised profit can be real, look on the internet, what revenue you can achieve in the competition, and whether the valuation is unrealistic, and pay attention to the promised guaranteed return," he advises the regulator.

It is good if the consumer always checks whether the entity is under the supervision of the NBS and whether he has a license to do business in that area. This can be done on the website of the National Bank, which also publishes alerts.

"A warning signal can be the head office of a company that offers its services exclusively via the internet, with its headquarters in a tax haven or outside the European Union. Check whether consumers in the forums do not complain about this company, whether or not consumers are in financial situation have lost resources ", he suggests to the NBS.

How Pyramid Games work

Pyramid schemes work according to the principle that the money that the man invests must be paid mainly to those who have placed the money earlier and are waiting for the investment that is valued.

"A large part serves to make a profit, so it works until there is money to pay or there are no new investors to find and the pyramid clamps," explains the National Bank.

If a consumer has fallen victim to such a pyramid, he has several options to help. It is necessary to contact the police or the public prosecutor directly and also to inform the NBS itself. "The National Bank cooperates with law enforcement agencies, even though the NBS does not have the right to recover money, but it can issue warnings to help other consumers", added the NBS.

What to pay attention to?



Read also: Year 2002: Tens of thousands of people lost savings in non-banknotes

The regulator recommends that consumers never conclude a contract for a financial product or financial service, such as a loan, insurance, investment, savings product, savings, or through an entity that is authorized to do so.

In addition, they have to consider whether they are prepared to take the risk of losing all the money that is deposited when they invest through an unknown company.

People also need plenty of time to think. "The serious consumer business is not rushing", warned the NBS and said that such investments are not covered by the Investment Fund. For example, if the company ceases to exist, it is unlikely that someone will ever get their money.

"To pay more attention to products and services that are not controlled by the NBS, such as virtual currencies, crowdfunding, P2P loans," the NBS added.


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