The Central Bank said that it is not responsible for the public investing in unregulated plantations schemes which are mushrooming in the country today promising unrealistic reruns on deposits.
“We have noticed a growing number of pyramid schemes in the plantation sector offering very a high return on investments. If funds are collected through unregulated schemes, the Central Bank will do its maximum to bring those behind the scheme to task,” Central Bank Governor Dr. Nanadalal Weerasinghe said.
The Governor was responding to a query as to what penalties are enforced on bogus plantations schemes.
“The Central Bank will not hesitate to take the maximum steps against illegal schemes fleecing the public,” the Governor said.
On an advisory note, he said, those investing in such schemes must ask the companies taking the money as to how they could give such a return within the specified time. The banking and financial sector regulator said that investment schemes such as teak, mango and wallapatta are neither regulated nor monitored by the Central Bank and thus the Bank is not accountable for the money invested in such schemes.
“There is no point regretting after dumping one’s hard earned money in schemes that offer unrealistic returns. One should check whether the scheme that he or she intends to invest is legal or not and ask the investment planner how he could guarantee the return,” Dr. Weerasinghe said.
It is said that fools rush in where angels fear to tread. That’s how many act when times are bad ending up losing even what they had. A bird in the hand is better than two in the bush. The Central Bank cut its Overnight Policy Rate by 25 bps to 7.75 percent last week. A question posed by analysts is, would those depending on interest income be compelled to go after schemes that offer higher returns when they get peanuts for their bank deposits.
