Windhoek-The Bank of Namibia’s reiterated stance that the services provided by the online-based MyLifeChange 247 (MLC247) are illegal and unsustainable has been met by some resistance by members of the public making use of it.
While some members of the outlawed service, which has been described as a pyramid scheme, have questioned its sustainability, most feel that they should be allowed to gamble with their money as they see fit even though the service has been periodically unavailable in December and early January.
The MLC 247 site was again unavailable yesterday, leaving a number of members questioning what has happened to their money and if they will ever see the massive returns promised.
The BoN said that in line with its mandate to protect the public from potential fraudulent financial schemes, the Bank of Namibia (BoN) last year issued two public statements warning members of the public to refrain from participating in the business activities of MyLifeChange 247.
This followed an assessment made by the central bank, which determined that the business model of MyLifeChange 247 contravened sections 5 and 55A of the Banking Institutions Act No. 2 of 1998.
“The Act empowers the Bank to take necessary actions against any person who conducts banking business illegally, participates in pyramid schemes or promotes such schemes.
“The Bank may refer any person to the prosecuting authority who, despite warning, continues to participate in or promote illegal financial schemes. In this regard, any person convicted of an offence in terms of the Act by a court of law shall be liable to a fine not exceeding N$ 1,000,000 or to imprisonment for a period not exceeding ten years or to both such fine and such imprisonment,” BoN’s Deputy Director for Corporate Communications Kazembire Zemburuka warned.
The Bank reiterated its position that the promotion of activities related to MyLifeChange 247 were in contravention of the relevant law.
“The Bank has communicated to stakeholders that the business model of MyLifeChange 247 primarily does not comply with relevant provisions of the applicable law, and is thus illegal. Further it is unsustainable and irregular, ultimately exposing the participants to the likelihood of losing their funds,” Zemburuka warned.
He added that the business model of MyLifeChange 247 was not sustainable and noted that the business promised a significantly high return of up to 75 percent within a short period.
“Such rate is unrealistically high in comparison to the rates offered by legitimate lending institutions. It should be understood that the principal feature of the business is a financial scheme based on a referral system, which involves attracting and encouraging members to invest and recruit more members with the possibilities of making commission.
“Apart from the above-mentioned referral system, the business seems not to have any other sources of income and does not sell any product. Therefore, in the event that members of the public stop participating in the scheme for whatever reason, the business is destined to collapse,” Zemburuka explained.
Local members of MLC 247 New Era spoke to feel that using the service is the same as gambling.
Speaking on condition of anonymity for fear of prosecution, one member said: “With business you just have to take a risk. It is basically the same as gambling and gambling has not been outlawed”.
Another member of the scheme is convinced that the service can work if all members are committed and honest.
“I did not go there without thinking. However I have since realise that the sustainability aspect was not properly thought through because the high returns promised are unsustainable,” he said, also preferring anonymity.
Another member, who had already received a payout from the scheme, said: “For me, it shouldn’t be illegal because it is not money that you borrow or steal. I feel the scheme should continue because members apply at own risk, just like gambling”.