by Mutinda Mwanzia
Co-operatives Minister Joseph Nyagah has sounded the alert over re-emergence of pyramid schemes.
Mr Nyagah said his ministry would not allow the registration of micro-finance societies, which did not meet the requirements.
He said Kenyans should learn from experiences in which many people lost their money through such schemes.
"I want to caution the public to be wary of such get-rich-quick schemes. They are a rip-off," said Nyagah.
Speaking to The Standard in Nairobi, Nyagah said on Thursday the emerging players behind the schemes were targeting coffee and tea farmers.
"They have been luring the farmers with promises of loans after they deposit some fixed amounts of money with the schemes," he said.
Nyagah said findings of a task force he appointed early this year to investigate pyramid schemes were an eye-opener to the Government and many Kenyans.
Fraudulent schemes
The task force, chaired by former Kitui West MP Francis Nyenze, indicated a former minister, a former MP, and a former diplomat were among the masterminds of the pyramid scams.
Thousands of Kenyans lost about Sh34 billion in the fraudulent schemes. Financial losses suffered by investors saw some commit suicide.
The minister said the findings of the task force had shown there were serious legal gaps within the financial laws that allowed the schemes to operate as co-perative societies, companies and non-governmental organisations.
Nyagah said the enactment of an Anti-Pyramid Schemes Act would cushion Kenyans against such fraud.
He said the Bill would introduce measures to rein in operators of pyramid schemes.
