Nyagah warns of pyramid schemes

By Standard Reporter

Co-operatives Development and Marketing Minister Joseph Nyagah has warned Kenyans to be wary of investment schemes promising more than 10 per cent in returns ahead of the General Elections.

The minister warned the mushrooming of pyramid schemes by individuals out to make quick money to finance election campaigns could exploit ignorant Kenyans by promising huge returns.

"It is not normal to make abnormal profits like say 50 per cent unless one is engaged in illegal activities such as sale of drugs," said the minister. Nyaga was speaking at the Co-operative Insurance Society, the investment arm of the Co-operative Insurance Group second Annual General Meeting in Nairobi.

The task force set up to investigate pyramid schemes by former minister, Francis Nyenze in 2009 revealed that part of Sh34 billion lost was used to fund the 2007 election campaigns.

Nyagah also disclosed the ministry is streamlining the matatu Saccos into the mainstream co-operatives movement to ensure efficiency within the public transport system.

He said members of matatu Saccos will work and behave like other co-operative societies in strict adherence to the rules.

CIC Insurance Group Limited chairman, Japheth Magomere, assured Mavuno policyholders that their policies are still effective and investments secure until maturity.