By Frank Kamuntu
Police on Monday 11th December 2023 provided an update on the investigations into the Capital Chicken scam that left Ugandans counting losses when the directors went missing with over shs 5 billion in investment.
Addressing journalists at police headquarters in Naguru on Monday, Police Spokesperson Mr. Fred Enanga issued a stern caution to the public regarding the proliferation of illegal pyramid or ponzi schemes operating within the country.
Enanga highlighted that the ongoing investigation, led by the Director of Criminal Investigations, indicates that the Directors of Capital Chicken allegedly defrauded victims of approximately Shs 5 billion.
“As you are all aware, the Directorate of CID continues to investigate circumstances under which several victims were defrauded to the tune of Ugx 5 billion, by Capital Chicken Limited. The victims were offered profits as returns, through an online investment contract, at an attractive interest rate of 40 – 60%,” Enanga said, adding that the company now faces charges of operating a business of fund management without a license, operating without an investment advisor’s license, and obtaining money by False Pretense.
Enanga further highlighted that currently, other Ponzi Companies in the market are also under investigation by the CID in coordination with the Capital Markets Authority. These include; Veta Plan, Mall Fund, Great Wealth Youth Platform Africa, Cashmulla, Pio Crypto, Premium Clusters, Contract Kapital, and Pacs Capital Limited among others.
Cash Mula, which has also caught the attention of unsuspecting Ugandans, asks users to deposit funds and are incentivized to invite others, creating a classic pyramid structure. However, users face the predicament of being unable to withdraw their funds, indicative of fraudulent practices.
“For instance, under Cashmulla, a user deposits Uganda shillings 17,000, and is encouraged to invite other users and earn a commission from users under them, which is a classic pyramid scheme tactic. The user cannot recover or withdraw their money,” Mr. Enanga explained.
“These schemes follow a pattern: they lure individuals with enticing promises, gather members, and subsequently freeze accounts, defrauding unsuspecting participants,” he added.
“We wish to caution the public that this is another get-rich-quick pyramid scheme, with the potential of defrauding Ugandans. Year after year, different pyramid schemes, change their company names during entry, then offer attractive packages or rewards after gaining numbers, they freeze the accounts and defraud the unsuspecting members of the public.”
Mr. Enanga emphasized the importance of enrolling in regulated investment opportunities endorsed by authorities like the Capital Markets Authority or other relevant regulators such as the Bank of Uganda.
“We urge the public to always carry out sufficient due diligence and only enroll in investment opportunities regulated by the Capital Markets Authority, or any other relevant regulator. In addition, they should seek investment advice from licensed investment advisors, before making an investment decision and avoid being victims of investment fraud,” he said.
