President of the Ghana Association of Bankers, Alhassan Andani has asked the public to be careful with the kind of schemes and institutions they invest their hard earned money in to avoid being scammed.
The banking expert cautioned that any investment package that is too good to be true or even takes more than five minutes to understand should be viewed carefully as such schemes are fraud.
“If it takes you more than 5 minutes to understand an investment, then it’s fraud. Take it from me. If it’s too good to be true, then it’s too good to be true,” Mr. Andani stated at the first of a series of economic dialogue by the Media General Group.
Mr. Andani who is also the Managing Director Chief Executive and Executive Director of Stanbic Bank Ghana Limited, gave the warning while speaking on the Ponzi schemes which have assumed an alarming rate in the country in recent times and caused loss of thousands of cedis to the unsuspecting public.
Themed “Investment in the Face of Ponzi Schemes: How Do we Clean the Mess?”, the dialogue came on the back of the recent collapse of some supposed investment schemes which turned out to be Ponzi schemes.
A Ponzi scheme is a form of fraud in which the unsuspecting public is tricked to invest in a non-existent investment scheme, with the promise of offering them ridiculous percentage as their investment returns.
About 10 of such Ponzi schemes have operated and either collapsed or owners ran away with huge sums of money being the investment of the unsuspecting public.
In order to build the scheme, the fraudsters pay earlier investors using funds from new investors, which entice more people to join.
The Bank of Ghana has consistently warned the public against investing and depositing their monies with such firms they suspect to be operating Ponzi schemes but most of them turn a blind eye to it.
Mr. Andani thus cautioned the general public to be vigilant in dealing with some of these ‘false’ institutions.
“I have what we call the five-minute rule in investment, and that, if anybody explains any kind of investment to you in five minutes, and you do not understand it, it is fraudulent.
“If you are not convinced in five minutes, if the person takes more than five minutes to convince you, take it from me, it is fraudulent,” Alhassan Andani warned.
He debunked reports that the inability of banks to give high interest on deposits, has resulted in customers choosing other financial products.
Grace Asare| 3news.com|Ghana