Call for more consumer protection measures amid rise in white-collar crimes

Economists in Rwanda have recommended the increase of consumer protection to detect fraudulent companies that are being involved in white collar crimes. The recommendation follows the announcement by Rwanda Investigation Bureau that white collar crimes or fraud crimes are on the rise and named 10 companies that have so far been identified to be behind the crimes. White-collar crimes refer to financially motivated, nonviolent or non-directly violent crimes committed by individuals, businesses and government professionals. They include wage theft, fraud, bribery, insider trading, labour racketeering, embezzlement, cybercrime, copyright infringement, money laundering, identity theft, forgery and others. The crimes also include Ponzi schemes, a form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors. According to RIB, most of the companies are registered in RDB but their operations ‘are totally different from the businesses they registered.’ Straton Habyarimana, an economist, told The New Times that Rwanda Inspectorate, Competition and Consumer Protection Authority (RICA) was recently created and it needs more capacity to protect consumers against fraudulent investors. However, he added that although Rwanda Development Board (RDB) is only concerned with registering companies, it should, in partnership with RICA, enforcement organs among other institutions, set up a joint taskforce to monitor and inspect what registered companies are doing on the market on a regular basis. “If the registered companies divert into other activities including fraud, it is not the mistake of RDB. RICA should primarily be responsible to protect consumers against such crimes. RICA should be inspecting to see if companies are doing what they registered and impose heavy fines or close them,” he said. However, he said considering that RICA is still young without enough capacity, there should be a law that can help strengthen its capacity to inspect all registered companies. “Companies are registered every day and there should be a strong mechanism of enforcement to protect consumers. RDB should also have an inspection department to ensure consumers’ protection and that they are not victims of emerging crimes in Rwanda. Even if it is there, it seems that there is still a big gap,” Habyarimana noted, adding that, “companies should not only be requested to pay taxes.” He cited other crimes committed by companies including copyright infringement. “There are laws and measures of easing business but if we are experiencing that registered companies are committing crimes against consumers, there should be a law that protects them,” he added. Teddy Kaberuka, another economist, reiterated to The New Times that registering a company is the first step which should be followed by strong measures to protect consumers from unfair products. “For instance, if you register a transport company in RDB, the next step is to get a license from RURA, if it is a food company, you have to be licensed by the food and drug authority. All these institutions should play a role in consumer protection,” he said. He said that some companies are registered in RDB but they are not licensed or checked by any other institution before starting operations. “These are involved in such crimes. For instance, why do you give money to someone else to import a car for you and even pledge huge profits when they didn’t invest their own money? Those people should invest their own money, bring cars, pay them and take away your car. Otherwise you are giving them a capital to buy such a car which is risky,” he argued. All that glitters is not gold, consumers told Kaberuka urged the public to be vigilant when they meet investors luring them by promising magic profits. “If someone asks you Rwf1 million and pledges to pay Rwf200, 000 profit a week, how do you think they will get profit from your money and you also get such magic profit?,” he advised. He further said that investigative agencies like Rwanda Inspectorate, Competition and Consumer Protection Authority (RICA), regulatory bodies, Rwanda Development Board (RDB) need to set up a strong monitoring and inspection system to detect white collar crimes. “RDB can have a desk in charge of monitoring companies and RICA needs more capacity to boost consumer protection. Pyramid schemes came some 10 years ago. Now others are being committed online. So the way to deal with such crimes needs to get a boost,” he said urging consumers to deal with investors, technologies generating money that are licensed by Rwanda. Some of the companies in white collar crimes named by RIB include Cavallon Ltd, BITSEC, and Gold Planning Artificial Intelligence, Binance, Tom Transfers, Kigali Analytics Trade with Diana Penda Africa, P & A Group represented by a person known as Shema and others.

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Call for more consumer protection measures amid rise in white-collar crimes