Tanzania’s Central Bank Responds to Online Lending Fraud Incident
The Bank of Tanzania is addressing a surge in online fraud, particularly related to the Leo Beneath London case, leading to several arrests. The central bank issued a statement clarifying their non-involvement with LBL. New regulations are being introduced for digital lending and microfinance operators to prevent fraudulent practices, with the feedback sought from the public before implementation.
The Bank of Tanzania (BoT) recently distanced itself from an online fraud case tied to Leo Beneath London (LBL), which is suspected of running a Ponzi scheme under the guise of a movie promotion agency. Authorities arrested 17 individuals during a nationwide crackdown, with suspects apprehended in Dar es Salaam, Morogoro, and Mbeya. LBL allegedly solicited deposits for an online program promising earnings from viewing movie clips and recruiting new members, indicative of a pyramid scheme.
The case involving LBL highlights the pressing need for stricter regulations in Tanzania’s microfinance sector. The Bank of Tanzania is taking steps to enhance regulations surrounding digital lending and other financial services to mitigate risks of fraud and misconduct. The newly proposed regulations aim to establish more stringent operational guidelines, licensing requirements, and protections for consumers.
Original Source: www.zawya.com
