Police probe DECI as BoT disowns schemes

Police are said to be investigating the Development Entrepreneurship for Community Initiative (Deci) for operating an illegal funds management scheme.

This comes as the central bank issued a statement on Wednesday warning the public not to invest their money in the company.

Enthusiastic investors kept thronging the company's Mabibo offices in Dar es Salaam this week to deposit their money despite warnings the scheme was illegal and risky.

Deci, run by the Jesus Christ Deliverance Church, is understood to be promising investors 300 per cent interests within a period of between three and 12 months.

Local bankers have said the company is running an illegal pyramid scheme and cautioned depositors against risky investments.

The Bank of Tanzania (BoT) and Capital Market and Securities Authority (CMSA) issued a joint statement Wednesday evening saying the scheme was illegal.

A police official speaking anonymously told The Citizen yesterday the company was now under investigations for the illegal scheme.

The probe team comprises officers from the Criminal Investigations Department, Prevention and Combating of Corruption Bureau (PCCB) and state intelligence, he said.

It emerged this week that a Kenyan company with a similar name to the revolving fund scheme that has wooed thousands of investors in Tanzania collapsed last December with Ksh600 million (over Sh10 billion) of investors� savings.

The Kenyan government is also said to be currently investigating the defunct company, which is called the Development Entrepreneurship for Community Initiative (Deci) Kenya Limited.

It is not yet clear whether the two are sister companies. Deci Tanzania officials have not confirmed any links with the Kenyan scheme.

Thousands of defiant Tanzanian investors have reportedly deposited billions of shillings into the company as bankers express concern it could collapse with investors' deposits.

Deci's 37 branches countrywide have become a popular spot for low-income earners and local business owners.

At its Mabibo headquarters in Dar es Salaam, the company is said to be receiving deposits from an estimated 3,000 people per day.

Deci officials last week told The Citizen that they had paid back Sh35 billion in profits and registered more than 500,000 members since last year when their activities picked up.

While the police yesterday remained tight-lipped on the said probe a source who spoke to The Citizen said some investigators had asked CMSA to confirm whether or not Deci was operating an illegal business.

In the joint statement, BoT governor Prof Benno Ndulu and CMSA chief executive officer Fratern Mboya said the company was not registered to operate the scheme.

They denied ever issuing Deci a licence to run a funds scheme and said the firm was involved in an illegal pyramid scheme that collapsed once in the country and in Kenya.

"It should be noted that, the promotion and participation in any pyramid schemes is an offence in terms of the provisions of the Penal Code,� part of the statement read.

The statement confirmed there is a "thorough investigation" to establish the scope and nature of the company�s operations in the country.

The central bank warned investors to discontinue any dealings of a revolving fund scheme nature with the company.

For its part, the CMSA, a government agency, said it was not aware of how Deci Tanzania was investing the money from its thousands of depositors.

Deci officials dismissed the criticism and claims the firm is running an illegal scheme as "unfounded and witch hunting," but did not explain how the firm made huge profits to pay depositors such attractive interests.

"We are not doing any business here, what we do is just revolve the funds, and that is why we call this programme 'tushikamane' revolving fund, we are just providing services and God watches over everything that we do," the firm's chairman, Reverend Jackson Mutalesi, said.

But media reports on the collapse of a similar firm in Kenya heightened suspicions on the sincerity of the scheme.

There are striking similarities between the Deci Tanzania Limited and the Kenyan company. The two have a similar name and both were started and run by religious organisations.

According to reports in the Kenyan media, Deci Kenya Limited operations went under when the Kenyan government launched a crackdown on suspected pyramid schemes.

A number of religious leaders later admitted to having misled their followers into joining the pyramid scheme.

Deci officials refused to talk to The Citizen yesterday when asked about the police probe. The firm's executive director, Mr Ole Loiting'ye curtly said he had nothing to say before disconnecting his phone.

But at the company's headquarters in Dar es Salaam investors seemed unmoved by the recent media reports. Some people jam the offices from as early 3am to late hours.