The financial regulator of Mauritius has issued a fresh warning to investors, highlighting concerns over two alleged crypto Ponzi schemes operating in the country. The Financial Services Commission, Mauritius’ chief financial regulator, issued the investor alert over schemes being advertised on social media.
In particular, the regulator flagged two digital assets, “Cloud Token Mauritius” and “Cloud Token Indian Ocean and Africa” in the note urging investors to beware of the risks of losing money in these schemes.
The public is informed that Cloud Token Mauritius and Cloud Token Indian Ocean and Africa and/or any other individuals or representatives operating under these names are not and have not, at any point in time, been licensed and regulated by the FSC.
The Financial Services Commission linked the digital assets to an app called “Cloud Token,” saying there were signs this was a Ponzi scheme similar to multi-level marketing scams.
According to the regulator, “Multi-level marketing (MLM) programs are usually promoted through Internet advertising, company websites, social media, presentations, group meetings, conference calls, and brochures. In an MLM program, an individual typically gets paid for products or services that he/she and the distributors in his/her ‘downline’…”
It added, “However, some MLM programs operate as pyramid schemes – a type of fraud in which participants profit almost exclusively by recruiting other people to participate in the program. In a pyramid scheme, money from new participants is used to pay recruiting commissions in a variety of ways to earlier participants. They can be similar to classic Ponzi schemes, where money from new investors is used to pay fake “profits” to earlier investors.”
The alerts are the latest warning shot from the regulator, tasked with protecting the integrity of financial services in the country.
With a growing number of complaints about losses in crypto Ponzi schemes, both in Mauritius and elsewhere, regulators worldwide are working flat out to identify and shut down scam cryptocurrency operations.
The Financial Services Commission has urged investors to take care when investing in cryptocurrency, and to refer to its website to check operators were licensed before making any significant investment.
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