“You can never be too careful when it comes to protecting your hard-earned savings. Get advice from an accredited and registered financial services provider before you invest your money,” spokesman Hlengani Mathebula said in a statement.
It was issued following the launch of a national campaign to raise awareness of illegal deposit-taking schemes, also known as pyramid or Ponzi schemes.
Accredited financial services providers were regulated and supervised by either the SARB, the Financial Services Board, or the National Credit Regulator.
“Do not just rely on advice from promoters or friends who may have benefited from their investment.”
The campaign encourages people to be careful when choosing investments.
“In pyramid and Ponzi schemes, for everyone who makes money, others will inevitably lose their money,” he said.
There were economic consequences to illegal deposit-taking schemes.
“In some cases people have raised loans with commercial banks and micro-lenders to invest in these schemes. The money is then lost when those schemes collapse but still they have to keep up the repayments to the lending banks for loans taken.”
He said pyramid schemes absorbed people’s savings, which would otherwise be invested in the country’s financial system.
“The value of people’s investments in these schemes varies enormously and can run into millions of rands.”