TRYNESS TEMBO, Lusaka
THE Securities and Exchange Commission (SEC) has called on the public to be wary when dealing with companies offering collective investment scheme (CIS) as some are unauthorised.
CIS is an investment scheme wherein several individuals come together to pool their money to invest in a particular asset and sharing the returns arising from that venture as per the agreement reached between them prior to pooling in the money.
SEC acting chief executive officer Mutumboi Mundia said the warning follows the advert LCB Moguls Zambia Limited issued on its Facebook page calling on the public to participate in its CIS, which is illegal as it is not regulated by the commission.
“SEC hereby notifies the public that LCB Moguls Zambia Limited had issued on its Facebook page, an advertisement inviting the public to become participants in CIS that it was operating.
“However, the commission wishes to advise the public that the said CIS being advertised by LCB is not authorised by SEC and is, therefore, illegal in accordance with the law,” Ms Mundia said in a statement availed to the Daily Mail yesterday .
She also advised members of the public who have made any payments in the company with respect to acquiring an interest in the said unauthorised CIS to contact the commission before July 14, 2017.
Ms Mundia said unauthorised CIS are not subject to the commission’s supervision or regulation and it cannot protect investors who invest in such ventures due to the number of risks associated with such investments.