This archive report was first published on 25 August 2020.
As the country continues to grapple with the economic impact of the Coronavirus pandemic, many Kenyans have turned to alternative ways of making a living, including forex trading and other financial schemes.
However, the Central Bank of Kenya has warned citizens of the dangers of these schemes, which promise quick returns but are often unlicensed and unregulated.
According to a statement issued by the CBK, some of these rogue entities include online pyramid schemes, unlicensed credit and savings schemes, and unlicensed online forex brokers and traders.
“Some have styled themselves as online global networking companies that seek to recruit members of the public to join and make cash deposits purportedly to buy shares in the company…other fraudulent unregulated entities styling themselves as online foreign exchange brokers and traders have also emerged,” the statement read.
The CBK has urged the public to only deal with licensed financial institutions and entities to protect themselves from being defrauded.
Regulated financial institutions are required to have a valid license issued by a financial sector regulator, and the list of licensed institutions can be found on the CBK’s website.
The CBK has also warned that action will be taken against all unlicensed entities that are offering fraudulent financial services.
Meanwhile, the DCI has arrested a man suspected of using WhatsApp to con unsuspecting members of the public, highlighting the need for vigilance in the face of these schemes.
