Logo of Phnom Penh Post newspaper Phnom Penh Post - CCF probes alleged pyramid schemes in Kingdom

CCF probes alleged pyramid schemes in Kingdom

Content image - Phnom Penh Post
CCF and Australian experts meet with possible victims to discuss investigations into an alleged pyramid scheme, at the CCF headquarters on November 28. CCF

CCF probes alleged pyramid schemes in Kingdom

The General Directorate of Consumer Protection, Competition and Fraud Repression (CCF) has opened an investigation into crimes related to an alleged pyramid scheme after receiving complaints from a number of victims.

Officials from the Australian Department of Consumer Protection are helping with the probe, having met with complainants regarding the pyramid scheme alleged to be operating in Cambodia, in order to gather information from witnesses and further investigate their case. It was not immediately clear if the scheme involves any Australian victims or businesses.

CCF director-general Phan Oun did not provide details, citing an ongoing investigation.

“We are looking into the company and gathering more information to determine whether its operation falls under the definition of a pyramid scheme, but we haven’t made any conclusions yet,” he told The Post on November 30, without naming the firm in question or specifying how many victims were involved.

He called on the public to be cautious about investment to avoid being tricked by those operating pyramid schemes, and encouraged people to report any suspected cases to the authorities for legal action.

Pyramid schemes are a business model that primarily requires recruiting more members into the scheme in exchange for payments or benefits, rather than providing an investment or selling products to end consumers to make a profit.

This method mainly relies on expanding the number of people enlisted in the scheme. The salesperson recruits a reseller who then goes on to select other resellers, with all of them purchasing inventory from the scheme operator, which usually ends up going unsold unless it is to other resellers. Those with the lowest recruitment score will receive the lowest commission rate and those with the highest score will receive the top commission rate.

This business model is considered fraudulent by many experts and is illegal in many countries, though some businesses similar to pyramid schemes called multi-level marketing businesses still manage to operate in a gray area, though they are often the targets of scrutiny by regulators and law enforcement.

Oun said that under Cambodia’s law on consumer protection, Article 20 clearly defines the meaning and the punishment for pyramid schemes, which are banned in the Kingdom. He warned that people who violate the law and operate or participate in such schemes could face two to five years imprisonment and fines of four to ten million riel.


  • Cambodia maintains 'Kun Khmer' stance despite Thailand’s boycott threat

    Cambodia has taken the position that it will use the term "Kun Khmer" to refer to the sport of kickboxing at the upcoming Southeast Asian (SEA) Games, and has removed the term Muay from all references to the sport. Despite strong reactions from the Thai

  • Chinese group tours return to Cambodia starting Feb 6

    Cambodia is among 20 countries selected by Beijing for a pilot programme allowing travel agencies to provide international group tours as well as flight and hotel packages to Chinese citizens, following a three-year ban. As the days tick down until the programme kicks off on February 6,

  • Capital-Poipet express rail project making headway

    The preliminary results of a feasibility study to upgrade the Phnom Penh-Poipet railway into Cambodia’s first express railway indicate that the project would cost more than $4 billion and would take around four years to complete. The study was carried out by China Road and

  • Thai boxers to join SEA Games’ Kun Khmer event

    The Cambodian SEA Games Organising Committee (CAMSOC) – together with the Kun Khmer International Federation (KKIF) and Khmer Boxing Federation – have achieved a “great success” by including Kun Khmer in the upcoming biennial multi-sports event on its home soil for the first time, said a senior

  • Bullets to bracelets: Siem Reap man makes waste from war wearable

    Jewellery is often made from valuable gemstones like emeralds or diamonds and precious metals like gold or silver, or valueless things like animal horns. But a man in Siem Reap has approached the manufacture of delicate pieces from a different angle. His unique form of

  • 61% of 2022 imports came from just 3 markets

    The three largest exporters to Cambodia – mainland China, Vietnam and Thailand – accounted for 60.94 per cent of the Kingdom’s total merchandise imports last year, at $18.245 billion, which was up 11.99 per cent over 2021, according to the General Department of Customs and Excise. Cambodia’s total imports