Sherab Lhamo

Even as new pyramid schemes continue to proliferate, duping many Bhutanese, the Competition and Consumer Affairs Authority (CCAA) has investigated and banned 12 pyramid and Ponzi schemes in the country so far.

These schemes include high-profile names such as DXN, Enveer, Puth Group, OnPassive, Crowd-One, Megnessa, Oriens, Qnets & Enagic.

Recently, the CCAA banned four additional schemes—Ripple Investment Platform, Octafx Trade Investment Company, Forex Guru Binary Company, and Phone Pay Investment Company.

A CCAA official said that these pyramid schemes often disguise themselves as legitimate and attractive business opportunities. “Pyramid schemes are essentially elaborate scams,” the official said. “They focus on recruiting new members rather than selling actual products or services and promise high returns in a short time frame without any proof of revenue from legitimate sales.”

The schemes reveal the complex commission structure only shown when an individual registers or joins the scheme. “No genuine product or service is offered,” said the official.

Recent schemes like Octa FX, Phone Pay, Forex Guru, and Ripple are similar to previously banned schemes such as Puth Group, Tallwin, and QNET. These schemes are designed to lure members for investments with promises of quick returns but do not contribute any real value to the economy or create meaningful employment, according to the official.

The recent pyramid schemes such as Octa FX, Phone Pay, Forex Guru, and Ripple operate online through websites and messaging apps such as Telegram, WhatsApp, and Instagram, enticing individuals with attractive commissions and bonuses for recruiting new members.

Even Puth Group, an illegal pyramid scheme that became popular in the country, incentivised users to recruit new members in order to earn additional money.

The CCAA investigates and bans these schemes based on public inquiries, reports from agencies, and sometimes social media alerts about suspicious activities.

Once identified as pyramid schemes, CCAA instructs promoters to cease operations immediately, and the schemes are formally banned.

The CCAA official said that in Bhutan, legitimate businesses, including e-commerce platforms, operate transparently governed by regulations like the Trade and Industry Rules 2023, and e-commerce guidelines. In contrast, pyramid schemes operate covertly, outside the range of these regulations.

As per the Consumer Protection Act 2012, pyramid schemes are illegal in the country.

The CCAA official said that all pyramid and Ponzi schemes eventually collapse due to a lack of new recruits or government intervention. “When these schemes fail, most members lose their money while the promoters would have made money and some early members may have regained their initial investment,” the official said.

The official cautioned that more schemes, which are designed to appear increasingly legitimate and appealing, are likely to emerge.

The CCAA advises the public to exercise caution, refrain from joining such schemes, and seek guidance from relevant agencies if uncertain about the legitimacy of an investment opportunity.