Ponzi Scheme Network Busted in Karachi: What It Is and How to Protect Yourself

The National Cyber Crime Investigation Agency (NCCIA) recently raided Karachi’s DHA Phase 1 and Phase 6. Authorities arrested several foreign nationals running a massive Ponzi scheme. This fraudulent network affected thousands of people, causing heavy financial losses.

Ponzi Scheme Caught in Karachi: NCCIA Arrests Foreign Nationals in DHA

On Thursday, the National Cyber Crime Investigation Agency (NCCIA), working with intelligence and law enforcement agencies, arrested several foreign nationals in Karachi’s DHA area. Authorities said the suspects were allegedly running a well-organized Ponzi scheme affecting thousands of investors.

As per DAWN news, NCCIA recently raided the DHA Phase 1 and Phase 6 in Karachi. The foreign nationals who were operating a huge Ponzi scheme were arrested by authorities. Thousands of people were victims to this fraudulent network with huge losses.

What Is a Ponzi Scheme?

Ponzi scheme is a fraud in finance. It offers good returns to the initial investors with funds of the subsequent players rather than the actual returns. The scheme is based on the ongoing new investments.

The term comes from Charles Ponzi, who in the 1920s ran a similar scam involving fake international postal voucher investments. Modern Ponzi schemes often operate online.

NCCIA has already acted on these scams. In July, police conducted raids on a factory in Faisalabad detaining 149 suspects among them 48 Chinese citizens. In the first half of this year, the National Accountability Bureau (NAB) Lahore found various fraudulent schemes of thousands of investors in their hands.

How to Protect Yourself from a Ponzi Scheme

1. Verify investment sources – Confirm sources of investment – Investigation companies prior to investment.
2. Verify investment sources – One of the warning signs is unrealistic profits.
3. Question high returns – Unrealistic profits are a major warning sign.
4. Check registration – Invest only in licensed financial institutions.
5. Report suspicious offers – Call NCCIA or NAB, in case something looks suspicious.

The Karachi network is still under investigation by the authorities to pinpoint more suspects. The case shows that one must be cautious to invest in Pakistan. Before giving in to anything, you must always verify information and do not give in to offers of quick money because it can make you lose some money.