The Commerce Commission is probing a suspected pyramid scheme active across multiple New Zealand communities while urging consumers to beware of money-making schemes that seem “too good to be true.”
The Hawke’s Bay-based scheme operates through multiple social media groups, promoting a business opportunity tied to the LiveGood health supplements platform.
Marketing takes place on Facebook, Instagram, and TikTok; once joined, participants are added to groups like Freedom Lifestyle Revolution, The Official Diamond Rush, and other New Zealand-based Facebook groups connected to the scheme.
“While the investigation is in its early stages, we believe we have a duty to publicise this potentially illegal scheme so Kiwis are aware of the risk of becoming involved,” Commerce Commission Deputy Chair Anne Callinan said.
“It is important that any potential harm is limited,” she added.
The Commission points out that the scheme’s low joining fees have led many participants to hold multiple memberships.
“It is crucial people do their due diligence before becoming involved in schemes of this nature – if something seems too good to be true, there’s a good chance it is,” Callinan said.
The Commission urges anyone with additional information or concerns about the scheme to get in touch or submit a report.
ComCom has also fielded concerns about a separate Wellington-based scheme.
“While our interim view is this is not a pyramid scheme, the Commission is reiterating a warning issued by the Financial Markets Authority in relation to it.”
This internationally originating scheme was first known as TXEX but operates under various other names, including UICEX, CR GLOBAL, Signal Trader, BG Wealth Sharing Group, and DSJ EX.
The scheme urges participants to invest in cryptocurrency trading platforms, promising substantial returns on their investments.
“Schemes present themselves in different forms, with different investment requirements and methods of promotion. These schemes entice people by promising high returns quickly and an opportunity to create ongoing wealth, which is typical of these scams,” Callinan explained.