Vice President of policy think tank, IMANI Centre for Policy and Education, Kofi Bentil has cautioned Ghanaians to make constructive research about financial institutions and ask probing questions before making investment decisions.

According to him, government is not under any obligation to refund money to people who lose money to financial institutions due to their lack of diligence.

"There is a responsibility that comes with investing...There is a fundamental requirement that you check where you're putting your money or who you're giving your money to," he noted. He added that "no government owes you anything if you put your money in an illegal investment and you lose it and soon we'll see people who are involved in these things being prosecuted for real".

Mr. Bentil further warned that "if the returns you're getting are more than the treasury bill rate, it is not the right investment, this is as simple as anything. Check where the treasury bill rate is. The treasury bill rate is the most secure rate and it is the highest you can find".

He was speaking at the Media General's Economic Dialogue on Thursday, October 18, organised under the theme “Investment in the Face of Ponzi Schemes: How Do we Clean the Mess?”.

Ponzi schemes appear to have gained roots in Ghana’s financial sector, regarding the alarming rate at which 'ignorant' investors are being misled by illegal financial assistants.

Ponzi scheme is a form of fraud in which the unsuspecting public is tricked to invest in a fake scheme with the promise of offering them ridiculous percentage as their investment returns. In order to build the scheme, the fraudsters pay earlier investors using funds from new investors, which entice more people to join.

Over the years, such schemes in Ghana have promised an investment rate of not less than 50 per cent. A case in point is the DKM Micro-finance that promised investors a 60% return within a period of two months.