The Bank of Namibia (BoN) has laid down the law once again by calling the seemingly popular Elamant company a pyramid scheme and therefore deemed its business as an illegal financial operation.
Advising the public to be cautious of where they put their hard-earned money, a bank statement noted that its investigation determined Elamant’s activities contravene Namibia’s Banking Institutions Act of 1998.
The statement by BoN’s director of communications and financial sector development Emma Haiyambo noted that Elamant, which was established in 2017 and appears to operate virtually out of Singapore, contravenes Namibia’s laws because it “promotes a referral system, which encourages existing members to continuously recruit new members in order to earn a promised monthly income,” reads the statement.
A pyramid scheme typically promises massive returns, provided more people are recruited to the scheme. While a pyramid scheme is often compared to a multilevel marketing (MLM) scheme, an MLM is actually different, as it involves selling products of some sort. Pyramid schemes, on the other hand, sell nothing but empty promises.
Haiyambo noted that the main source of income for Elamant is derived from the payment of new member joining fees and monthly subscriptions from existing members.
“The business model is, thus, not sustainable and will likely result in the public losing money,” Haiyambo cautioned.
In the same statement, Haiyambo noted that BoN still considers Crowd1 Network Limited as illegal and she directed that promoters and participants of this scheme immediately cease their activities. Commenting on BoN’s Elamant announcement yesterday, some social media users called for more investigations into similar schemes, while others voiced their support for the questionable so-called ’investment’ vehicles.