The Bank of Namibia, after having conducted an investigation into the business activities of Mufhiwa Building Projects, has ruled that the business activities thereof constitute and resemble the characteristics of a pyramid scheme. According to the Bank, members and participants in Mufhiwa Building Projects are encouraged to recruit new members, upon a payment of a joining fee of N$200.00, with the promise that such members receive payments to have their home loans settled, or to purchase new houses, or to renovate their existing houses. This joining fee is used to pay existing members and the directors or owners of the scheme, therefore, as soon as the recruitment of new members stops all the members and participants in the scheme will not receive any payment and will lose their joining fee. The Bank therefore cautions the public not to participate in Mufhiwa Building Projects as doing so contravenes section 55A of the Banking Act.