Regulatory Alerts2020-05-21
Ponzi Schemes and Scam Activities During and Post COVID-19
The Capital Markets Authority (CMA) of Uganda has issued a public warning detailing how to identify and avoid fraudulent investment schemes and Ponzi operations that exploit economic distress caused by the COVID-19 pandemic. The advisory outlines specific red flags, such as unlicensed operators, excessively aggressive marketing, unrealistic return promises, and pressure tactics, while advising investors to verify sponsor licenses, use traceable payment channels, and consult licensed advisors before committing funds. Additionally, the CMA instructs existing securities and collective investment scheme investors to seek professional guidance and properly execute buy or sell orders to mitigate pandemic-induced market volatility.
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