RBI Warns General Public to remain away from Pyramid Schemes

Admin   |   03 January, 2015   |   846   |   3980

MUMBAI: The Reserve Bank of India (RBI) on Thursday cautioned investors against multi-level marketing firms that promise high returns and run on hefty member susbscription fees, warning such offers could result in direct financial losses.

"MLM/chain marketing/pyramid structure schemes promise easy or quick money upon enrolment of members. The Reserve Bank has advised that members of public should not to be tempted by promises of high returns offered by entities running multi-level marketing/chain marketing/pyramid structure schemes," it said in a statement.

There has been a spurt in the number of such schemes in recent past even as various regulators are taking actions such entities.