WILLEMSTAD – Fundashon pa Konsumidó is warning consumers in Curaçao to be cautious of investment opportunities and business models that primarily reward participants for recruiting new members rather than selling legitimate products or services.
The consumer protection organization said it has recently received an increasing number of inquiries from the public about suspected pyramid schemes.
According to the foundation, pyramid schemes typically require new participants to make an initial financial investment. A portion of those funds is then used to pay returns to earlier participants instead of being generated through the sale of genuine products or legitimate services.
The organization warned that such schemes can only continue operating as long as new members keep joining. Because the model depends on an ever-growing number of participants, pyramid schemes inevitably collapse, leaving most participants with financial losses.
Fundashon pa Konsumidó noted that these schemes are often promoted as attractive investment opportunities promising substantial profits in a short period of time with little effort.
Consumers are urged to exercise extra caution when the emphasis is placed primarily on recruiting new members while little or no explanation is provided about the actual source of the income.
The foundation identified several warning signs that may indicate a pyramid scheme, including mandatory upfront investments, promises of rapid financial independence, pressure to make immediate decisions, and a lack of transparency about how participants are paid.
Anyone who suspects that a pyramid scheme is operating in Curaçao or Sint Maarten is encouraged to report it to the Central Bank of Curaçao and Sint Maarten (CBCS).
The consumer organization also advises individuals already participating in such schemes to stop investing additional money, refrain from recruiting others, preserve contracts, payment receipts, invoices and all communications with the organization, and formally terminate their participation whenever possible.