Have you lost money? What to do next

Have you lost money? What to do next (Photo: iStock)

Losing a significant amount of money, whether through an investment gone wrong, a sophisticated scam, or an unforeseen business collapse, is more than just a financial setback. It’s a deeply unsettling event that can shake one’s confidence and sense of security to the core. We won’t even discuss high blood pressure and ulcers; that’s a story for another day.

From shared stories, you’ll quickly realise that, unfortunately, most of us are not immune to schemes that prey on our hope and trust. Take, for instance, reports that emerged early this year regarding a cryptocurrency investment platform called CBEX. It lured investors in Kenya and other African countries with promises of exceptionally high monthly returns, often claiming to use advanced AI for trading signals.

Many individuals invested substantial sums only for the platform to cease processing withdrawals, leaving countless people facing significant losses. Such schemes, with unrealistic returns, pressure to invest immediately, and a lack of clear regulatory oversight by bodies like Kenya’s Capital Markets Authority (CMA), should be a red flag. 

However, the prospect of quick wealth can be very enticing. This recent example, like many others, highlights the importance of due diligence.

If you find yourself in the aftermath of such a loss, the initial moments can feel overwhelming. The first step, albeit difficult, is to face the reality and take immediate control of what you can. Start by ceasing all further engagement. If the loss is due to a scam or a questionable investment, do not make any further payments or communication. Do not think about sending more money in an attempt to “unlock” previous investments, which is a common tactic used by scammers.

Instead, report the incident. Document everything and report the scam or fraudulent activity to the relevant authorities. This could be the Directorate of Criminal Investigations (DCI), the Banking Fraud Investigations Unit (BFIU) if a bank was involved, or the CMA for unregulated investment schemes. Sadly, recovery of funds is usually rare, but it shouldn’t stop you from reporting, as that can prevent others from falling victim.

Now that it’s clear you’ve been conned, try and assess the full financial impact. This is a painful but necessary step. Calculate the exact amount you lost, including any debts incurred as a result of loans taken to invest, and your current financial standing in terms of assets, remaining savings, income, and personal expenses.