The Central Bank of Sri Lanka (CBSL) has received 30 complaints in the past four months about the prohibited pyramid scams that are mushrooming day like a financial tsunami.
Regarding the public complaints received, the CBSL, the Criminal Investigation Department and the Sri Lanka Police will conduct formal investigations and strictly enforce the law and punish those involved.
There are a number of financial crimes and illegal schemes, including investing money in pyramid schemes.
The Central Bank says that it is an offence, punishable under the Banking Act No. 30 of 1988, on engaging in pyramid type financial scams. In addition, participation in pyramid schemes is a major offense under the Banking Act. Besides under the Penal Code, fraud through such a thing is an offence.
Money laundering is an offense under the Prevention of Money Laundering Act. Those involved are also guilty of concealing true information under the Financial Transactions Reporting Act.
The Central Bank emphasizes that those participating in prohibited pyramid schemes also commit a number of errors and incidental errors including non-payment of debts, theft, preparation of false documents, check fraud.
Initiating, promoting, propagating, financing, managing, directing and other offenses and crimes punishable under Section 83 (c) of Act No. 30 of 1988.
If a person commits such an offense without knowing it, the punishment has been introduced to 3 years imprisonment or a fine up to ten lakh rupees or both imprisonment and fine.
The Central Bank also says that those engaged in pyramid schemes knowing that someone else will suffer loss or damage will be punished with imprisonment between 3 and 5 years with hard labour and a fine equal to Rs.2 mn or twice the amount received from the participants, whichever is greater.
Suppression of prohibited pyramid schemes cannot be done by the CBSL alone. For that Central Bank, Banking and Financial Institutions, Sri Lanka Police, Attorney General’s Department, Political Authority. Government officials, religious leaders and religious shrines, judicial system, media and the entire country should work together to save the country from this trap.
Pyramid fraudsters are tempted to deceive people and extort money through souvenirs, health equipment, medicines, herbal beauty products, solar power systems, electronic devices, foreign trips, hotel packages, and many other ways.
A police officer of a higher rank than the rank of Inspector shall, when there is evidence to the satisfaction of the satisfaction of the persons and businesses carrying out such fraudulent transactions, contravene section 83 (c) (1) of the Banking Act, established in terms of 154 (c) of the Constitution of the Western Province in Colombo.
The Central Bank also emphasizes that it can go to a High Court and request a unilateral injunction to suspend those businesses.
Also, according to the Code of Criminal Procedure Act No. 15 of 1979, if punishable by imprisonment for a period of three years or more but less than seven years, he can be imprisoned without a warrant.
Police can inform court that a non-bailable, non-conciliatory offence has been committed.
Insisting that no one should deposit money except in institutions regulated by the CBSL, the Central Bank accepts deposits and facilitates notification to the nearest police station, the Central Bank of Sri Lanka, the Criminal Investigation Department and the Attorney General’s Department.
It is said to have been given. In particular, the Director of the Resolution and Empowerment Department of the Central Bank of Sri Lanka can be informed about this through letters, e-mails and telephones.
The department also emphasizes that it will never reveal the information to anyone.