By April M. Montes, PIA 1, Pangasinan
DAGUPAN CITY – The Department of Trade and Industry (DTI) warns the public anew from being hoodwinked into patronizing the “online paluwagan” because it is another form of investment scam that aims to divest their hard-earned money.
Guillermo Avelino Jr., senior trade and industry development specialist of DTI-Pangasinan, advised the public to be wise in dealing with a get-rich-quick money scheme as they might end up empty-handed in the future.
“The scam enticed would-be victims that their money will grow high in a short time. Don’t easily get fooled if it is too good to be true,” Avelino said during the Pantongtongan Tayo radio program of Philippine Information Agency-Pangasinan.
Pinoy Scam Detector website describes the online paluwagan as following the structure of the Ponzi scheme or pyramid whereas you have to recruit a down line and complete the board to have an exit cash, technically, you have to recruit people who will fund your pay-out, which is the most basic part of pyramiding scam.
“You will notice that you are recruiting other people to get your cash and you will just keep on doing the cycle until there are no more people to join and those who are last to be part of it shall face the loss of money,” it said.
Avelino said the Consumer Act of the Philippines prohibits pyramiding schemes, which are defined as “sales devices whereby a participant makes an investment for the right to recruit others, with profits from the scheme being derived primarily from recruitment rather than from the sale of consumer products, services or credits.”
He stressed that the DTI continues with its advocacy campaigns against investment scams to protect people from falling prey to these unscrupulous activities as only a thin line separates a legitimate multi-level marketing system from an illegal pyramiding scheme.#