The Australian Competition & Consumer Commission (ACCC) has delivered an online training session to colleagues at Cambodia’s Directorate-General of Consumer Protection, Competition and Fraud Repression (CCF). The partnership aims to combat pyramid schemes in the Kingdom after several high-profile scams have impacted consumer confidence.
The initiative is part of the Mekong-Australia Partnership, which is helping our Mekong neighbors strengthen their economic resilience and recover from COVID-19.
A spokesperson for the Australian Embassy in Phnom Penh told Cambodia Investment Review that the training aimed to provide investigators from CCF with practical knowledge and skills to identify and investigate pyramid schemes.
“This will help CCF to deter or penalize perpetrators of these types of schemes and prevent Cambodian consumers from falling victim and losing their money. The training will also help CCF to develop implementing ‘prakas’ [laws] relating to pyramid schemes and multilevel marketing schemes under Cambodia’s Consumer Law 2019,” the embassy said.
The Law on Consumer Protection, enacted in 2019, established for the first-time consumer rights and new rules governing competition, with significant implications for intellectual property rights.
The stated goals of the law are to protect consumers, ensure trading is fairly competitive, and promote trust between consumers and businesses. It applies to anyone engaged in business – whether for profit or not – including selling goods, services, or property to consumers in Cambodia.
There have been several high-profile pyramid schemes over the last few years that impacted investor confidence in genuine investment operations promising ultra-high returns of usually between 10% – 20% per month on the initial investment.
Last week local media reported that authorities arrested two suspects claiming to be the distribution agent of the ‘Unicity Make Life Better Company’ in Kampong Speu Province.
The agents persuaded locals to believe the health products were able to cure long term aliments by citing practical examples of someone who has been ill for years and had recovered after using their company’s health supplements for a short time.
After gaining trust, they tried to attract customers to use the product for profit and have the opportunity to earn money from the promotion of the company’s products. By changing from ordinary users to primary distributors, some were promised they could even become area managers by using cash to buy investment packages.
The two agents, along with four other party members, recommended the purchase of a $25,000 package, promising a monthly dividend of $ 3,000 and receiving Gold card from the company for work in the future, and when they retire, receive a monthly stipend of $1,500 to $3,500, along with the opportunity to travel abroad, travel to Europe and Asia.
The Cambodia-Australia Consumer Protection Partnership was established last year with Australia has agreed to station a consumer protection technical official in the Kingdom following a request by the Ministry of Commerce.
The request was made at a meeting this week between Minister of Commerce Pan Sorasak and Ambassador of Australia to Cambodia Pablo Kang.
An Australian embassy statement at the time read: “Through this partnership, the Australian Competition and Consumer Commission (ACCC) will provide support to Cambodia on the implementation of its recently passed consumer protection law. This builds on the ACCC’s enduring engagement in Southeast Asia on competition law issues.”
