Uganda’s Ministry of Finance calls for caution in investing in hidden assets and financial pyramids. This is related to the growing wave of fraud revealed in the crypto business. The government intends to update the Penal Code to contain this wave of fraud.
Investors in Uganda fear the financial pyramids
The local media reported that Uganda’s Finance Minister David Bahati, after speaking to parliament, asked the government to react to this pathological situation and to publish a public warning to investors in the country. It is intended to warn them of the risk of investing in the unregulated crypto market and the related financial pyramids. The Minister of Finance has also called on the government to ban investment in such financial pyramids on the Ugandan cryptocurrencies market as soon as possible.
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The problem that has arisen in Uganda is that the companies involved in the financial pyramids register as legitimate financial organisms and after some time change course of business and offer fraudulent services to defraud investors. They promise them high returns, operate over a long period of time and pay the oldest investors with the money that newcomers have invested in this business.
The problem is not easy to solve, because the obstacle in the fight against this fraud is the fact that many former and current members of the Ugandan government and other influential public figures are involved in the financial pyramids. One example is the company run by the son of Uganda’s ex-premier Ruhakan Rugund, who ran this financial pyramid. Hon Mwine Mpaka, a member of the Ugandan parliament, stated that the government is involved in this corruption and instead of helping to combat it, it protects the fraudsters who are in its ranks. This situation does not make it easy to deal with the problem quickly.
The Ugandan government is fighting fraudsters
The Speaker of Parliament, Rebecca Kadaga, has demanded that the finance minister explain how the government is doing in the fight against the cryptocurrencies financial pyramids. Bahati said it had already appealed to the Ministry of Justice and Constitutional Affairs to speed up work on new legislation that would be more restrictive for the authors of such fraudulent investment programmes. The current anti-money laundering law is to be amended to include the issue of virtual assets in the form of cryptocurrencies. Following these legislative changes, companies investing in crypted assets will be subject to control by the Financial Intelligence Authority, which will closely supervise the implementation of this change.
The Central Bank in Uganda and the Ministry of Finance will ensure that citizens are educated so that they fully know what crypted assets are and what risks are associated with investing in them. They also need to know exactly what the Ponzi schemes and investments in financial pyramids are. Without full public information, it will not be possible to combat the scale of fraud in the crypto market.
The Minister of Finance also said that the national group of experts watching over the fourth industrial revolution will continue to work with the government on this issue. The group has been active for a year, initially analysing blockchain and crypto projects, but also analysing artificial intelligence, the Internet of Things, robotics and nano- and biotechnology. It also examines global trends and acts as an advisor to the parliament on the optimal use of these technologies in the country.