The Bank of Botswana has exposed some businesses conducting illegal deposit taking activities and such businesses have been determined to be pyramid schemes. Two such businesses identified by the Bank are Global Dream Network and Dynamic Cycle Network. According to the central bank, Pyramid schemes and other illegal deposit taking activities are unlawful in Botswana; the nature of these operations constitute illegal deposit taking from the public, hence contravene Section 3(1) of the Banking Act (CAP. 46:04) (Act).
This provision of the Act restricts transacting banking business and/or advertising for or soliciting deposits of money solely to licensed banks. It is also a criminal offence, punishable by law, for any person to promote the aforementioned illegal activities in Botswana, as that constitutes unfair trading practice. Section 5(1) of the Act empowers the Bank to investigate a person or entity suspected to be conducting unlicensed banking business and/or illegal deposit taking activities. If the investigations confirm the contravention, subject to other intervening measures, the activities shall be suspended forthwith. The Bank has accordingly directed the promoters of Global Dream Network and Dynamic Cycle Network, which operated from Plot 36222, Block 8, Gaborone, to cease and desist from transacting the illegal business schemes.
In accordance with Section 3(4) of the Act, any person involved in illegal deposit taking or operating a pyramid scheme contravenes the banking laws and, if found guilty, is liable to a fine of P2 500 for each day on which the offence occurs and to imprisonment for five years. Furthermore, in accordance with Section 5(6) of the Act, failure to comply with the Bank’s order to cease and desist from such operations render the owners/promoters liable to a fine of P2 000 on each day on which the contravention occurs and to imprisonment for three years.