When Tshepang Katso* got the Whatsapp invite from a friend to join an “Ecoplexus investment group”, she was told that it would be like “downloading money from the internet.” It was not until this week, when the Ecoplexus scam collapsed, that the 29-year-old unemployed accounting graduate realised that she had been the victim of a ponzi scheme.

According to Interpol’s Online Scams report, Africa loses over $500 million of its GDP per annum to online scams such as email scams, romance fraud, social media scams, malware attacks, and so on.

“It looked like such an easy way to make money because initially I joined for free and made easy returns. I then kept going up the different levels trying to get even bigger returns through the daily withdrawals. In the end, I invested over P3,000 (~$223), money I had borrowed, before the whole thing collapsed,” Katso told TechCabal in an interview.

The Ecoplexus scam purported to invest victims’ funds in products of Ecoplexus, a real US company which specialises in the development, design, construction, and financing of renewable energy projects in the US and key international markets. 

The modus operandi was of a typical ponzi scheme, which refers to a scam in which “a con artist offers investments that promise very high returns with little or no risk to their victims. The returns are said to originate from a business or a secret idea run by the con artist.”

The Ecoplexus scheme required the victim to enter the initial stage, called PV0, in which no investment was required, but a daily income of P2 (~$0.15) was guaranteed. Withdrawals at that level capped at P150 (~$11). This was said to be a trial stage and the victim had to upgrade to another level within 10 days. In addition to the daily income, victims also earned returns of P2 for each successful registration of the first 20 people they referred.

The next stage, known as PV1, required an initial investment of P230 (~$17) with a daily income of P7, capped at 365 days. In theory, victims were looking at profits of over P2,550 (~$190) in one year, a whooping 1,100% return on investment, if they held onto that level for a year.

The returns got even wilder as victims moved up the scam’s “levels”. At the highest level, known as PV5, an initial investment of P26,000 (~$1,935) would yield P1,100 (~82) daily, also capped at 365 days. Assuming the victim made daily withdrawals, they were made to believe that they could make P401,500 (~$30,000), a 1,544% return on investment, in just a year.

Apart from the daily returns, victims were also promised numerous incentives including referral rewards for recruiting more victims, upgrade rewards for moving up a level, daily commissions for completing tasks, and lucky wheel rewards which promised up to P9,999 (~$744) in raffle-like draws.

“For the well informed person, it seems ridiculous that people fell for a scam that promised such unrealistic returns. But you have to understand that the majority of victims are not only limited in their knowledge of internet scams, but they are also desperate for any easy money that they think they can make,” said Richard Harriman, a consumer protection advocate who runs a 204,000-member awareness group called Consumer Watchdog Botswana.

Indeed, most victims of the scheme, even those who managed to make some withdrawals early on, seemed to not have any idea of what exactly they were investing in.

“All I know is that I had a link where I just had to click “working” every day in order to get my daily withdrawal. I also had to share referral links to other people. I honestly don’t know what product or service the company Ecoplexus is involved in,” said another victim who spoke to TechCabal under condition of anonymity.

The links in question led to a dupe of the real Ecoplexus website. While the real address of Ecoplexus is www.ecoplexus.com, the scheme’s referral link was h5.ecoplexus-es.com.

As word of this get-rich-quick scheme spread like wildfire on social media platforms such as Facebook and Whatsapp, groups were flooded with referral links asking members to join. 

As more people joined and boosted about their withdrawals, cracks in the Ecoplexus scheme started to show. In late April, some customers began to experience delays with their withdrawals. Amidst inquiries, the victims were directed to contact “Regional Managers”, the supposed representatives of Ecoplexus in the country.

Reasons given by the regional managers for the withdrawal issues were varied but most of them seemed to point the fault at the victims’ bank accounts, held at First National Bank Botswana (FNBB). Some victims contacted the bank to inquire about the status of the funds. As the complaints mounted, the bank put out a statement denying any knowledge of such funds.

“It has come to our attention that there are ongoing allegations on social media regarding FNBB’s involvement with a certain entity named ECOPLEXUS. These allegations claim that FNBB is withholding funds for some individuals who are supposedly investors in ECOPLEXUS. FNBB would like to confirm that these allegations are not true and we advise the public to exercise caution when approached to deposit money to any FNBB accounts under the pretext that they are owned by ECOPLEXUS,” the bank’s statement read.

According to Harriman, there is strong reason to believe that the total amount scammed from the victims who were unable to withdraw their funds runs into tens of millions of pula. The Ecoplexus scam website, meanwhile, is no longer functional.

“There are people who invested tens of thousands of pula into the scheme as they wanted to up their amount of daily withdrawals. Those are the people who have been hit the hardest and it’s sad to see people’s money they work hard for going down the drain over something that could be avoided with the most rudimentary education,” said Harriman.

However, some victims are optimistic about getting their money back and have involved law enforcement officials in their quest for justice.

“I have heard from some groups that some of our money has been found in FNBB accounts belonging to Ecoplexus and its associates. We are hoping that by engaging the police, FNBB can freeze the accounts and redistribute the money to us,” said one victim in a Facebook post.

The country’s consumer protection agency, the Consumer Authority, is also making efforts to assist victims of the scheme.

“It should be noted that the Authority can only investigate the civil part of the scheme, while Botswana Police Service will investigate the criminal elements of the scheme. During the Authority’s preliminary investigations, it was observed that there are criminal elements dominating in the scheme. The Authority has therefore registered a case with the Serious Crime Squad for criminal investigations,” Gladys Ramadi, the authority’s spokesperson, told Mmegi, a local publication, in an emailed response.

According to Dr June Jeremiah, a cybersecurity professional and advocate, it is very unlikely that victims will get their money back.

“This is unfortunately not the first online ponzi scheme in Botswana and it is definitely not the last. Like with previous ones, victims never get their money back because these scammers are experienced in their way of doing things. You will see that most of the time, they move the scammed funds so quickly that by the time victims become aware, those alleged accounts have long been wiped dry,” explained Dr Jeremiah.

According to Harriman, there are so many similar scams currently running that trying to get rid of all them at once is like trying to kill the proverbial Lernaean Hydra, a Greek mythology serpent which grew two heads when one was cut.

“You have the likes of Berry Trading, RedCoin, and many others which promise unrealistic returns under the same modus operandi as Ecoplexus. Despite seeing how these scams have ended in the past, people still rush to join because they believe if they are just early enough, they will make returns before everything comes crashing down,” he adds.

To reduce the proliferation of scams in the country, Harriman believes beyond just consumer education, there must be proactive effort by law enforcement officials to bring the perpetrators to justice.

“They are [the scammers], after all, breaking the provisions of the Consumer Protection Act. Catching the bad actors is easier when the scam is still in its early days but the problem is, at this point, the victims are getting gains and have no reason to call law enforcement. It is only late into the scam when things crumble and it’s too late that people think of engaging the police,” he said.

Dr Jeremiah on the other hand believes that in addition to consumer education and law enforcement, victims sharing their stories would also go a long way in educating potential victims of the scams.

“Some people lose so much money in these scams that they are afraid of sharing their experiences with other people out of fear of being shamed and ridiculed. But if more people shared these, we would be much more aware amongst our communities in case other future scams try the same modus operandi,” he adds.

In the Ecoplexus case, social media played a vital role in fostering the virality of the scam by giving perpetrators and oblivious victims an avenue to add even more victims to the scam. With Botswana having over one million social media users who spend a significant amount of time on the platforms, social media can be both a catalyst and a deterrent to the scams by acting as a medium for consumer education.

However, even when armed with knowledge about what exactly ponzi schemes are and how they can be prevented, some people have a belief that if they get in early, they can “game” the system by making profits and exiting before everything crumbles.

Katso is one of those people. Although she feels terrible about the amount of money she lost in the Ecoplexus scam, she believes that she has learnt a lot— not to eschew them completely, but to ensure that she plans her entrance into the next one more carefully.

“I mean it’s clear that there is money to be made if you just enter at the right time. I learnt my lesson in Ecoplexus and hopefully when something similar comes up, I’ll be more ready to cash out as early as possible,” she adds. “I graduated in 2017 and I still haven’t found a job. What else can I do but go for these opportunities to make easy money?”

With an unemployment rate of almost 25%, it seems like fighting the proliferation of online ponzi schemes in Botswana will be hard as long as desperation is the main motivation to partake in scams like Ecoplexus.

*Not real name

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