Cape Town-S.A Alleged Ponzi scheme exonerated

Alleged pyramid scheme DiPESA has been exonerated by the National Consumer Commission (NCC) after an investigation showed that the business was “legitimate”.

In September 2015 the NCC launched a preliminary investigation into nine suspected pyramid schemes to establish whether they were in contravention of the provisions of the Consumer Protection Act (CPA) and its regulations.

The schemes and investment initiatives still under investigation are WorldVentures, Kipi, also known as Mydeposit241, Make Believe, NMT Investments, Instant Wealth Club, MMM South Africa, Sikhese (Pty) Ltd as well as Wealth Creation Club.

NCC spokesperson Trevor Hattingh told Fin24 that DiPESA showed no characteristics of operating a pyramid scheme, as defined by the Consumer Protection Act.

“On completion of our assessment into the business practices and operating model of DiPESA, the NCC found that the company did not require any further assessment or scrutiny,” he said.

Hattingh said that the NCC would not update the media or public on the outcomes of its assessment on the other suspected schemes “simply to safeguard the integrity of the processes on the part of the Saps (South African Police Service).

“We have been working with the Commercial Crimes unit of Saps on this matter from the onset, and have now handed over all information and assessments to them to deal with the matter further,” he said.

DiPESA CEO Henk Van Zyl told Fin24 that his company had created a sustainable opportunity for low investment business ownership with a high residual income return, based on a four level network matrix, through the selling of airtime and electricity.

“Each Independent Business Owner (IBO) receives residual income from airtime used by members in all four levels. IBOs are DiPESA’s sales force and are compensated not only for sales personally generated but also for the sales of the other IBOs that they introduced, creating a downline of IBO vendors and a hierarchy of multiple levels of compensation,” he explained.

NCC commissioner Ebrahim Mohamed said in an exoneration letter to DiPESA CEO Henk Van Zyl that the company “appeared to be running a legitimate business”.

“The NCC investigators have finalised the investigation into your business practices and they have informed me that the evidence provided, as well as their observations, DiPESA appears to be running a legitimate business with tangible assets/products and services provided to its customers,” Mohamed said.

Van Zyl said that “unjustified media reports” had disrupted the company’s business operations and led to “great financial losses”.

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Source: Fin 24