Entering the module
One sentence: fraud does not succeed because the fraudster is clever, but because we are human — we hurry, we trust, we don't want to miss out; that is why protection is a habit, not intelligence.
Chapters:
- What fraud looks like from the inside
- Ponzi and pyramid schemes: the scheme that always collapses
- "Guaranteed high returns": the red flags
- Fraud on social media: fake advisers, fake faces
- Crypto fraud and "investment platforms"
- Loans, "buy now, pay later" and quick loans
- Bank fraud: codes, the "safe account", phishing
- How to check and where to report
- The law and the joke: what the Criminal Code thinks
- Your rights as a consumer and where to look for advice
- The regulators: who protects what → The iron principle of the module
🎓 Academic basis. Fraud relies on a few well-described psychological levers: authority, scarcity/urgency, social proof, reciprocity, liking, consistency (Cialdini, Influence, 1984) ✔. They are not a "weakness" of foolish people — they work on everyone who is tired, worried or in a hurry. That is why this module teaches a brake, not suspicion.
For the youngest · ages 6–7
🐣 The youngest: Sometimes someone promises lots of things, quickly and easily. Then you stop and ask a grown-up you trust. Secret words, like a password, stay at home. Asking is clever and brave. Grown-ups are happy when you ask them.
Play together (5 minutes): Play "Stop and ask". You are a talking robot and say different sentences: "Let's draw!", "Tell me the secret word and you'll get 10 sweets!". When the child hears something strange, they say "Stop!" and come to ask you. Celebrate every "Stop!".
A question for the evening: "Who can you tell when something seems strange to you?"
A game from the catalogue: KP-17 "What is only mine" — https://pecuvo.eu/igri/katalog/#kp-17 (in Bulgarian)
Chapter 1 · What fraud looks like from the inside
👧 Child If someone you don't know writes to you that you have won a prize and asks you to tell them your password — stop. Show a grown-up. It's like the "secret word" game: no stranger knows it.
🧑 Teenager Most frauds have the same steps:
- Contact — a message, a call, an advert, an "accidental" mistake.
- Trust — a beautiful story, photos, "proof", reviews.
- Pressure — "today only", "3 places left", "the others are already earning".
- The request — money, codes, data.
- Silence — "don't tell anyone", "it's complicated to explain".
The earlier you notice step 3 or step 5, the easier it is to get out.
🧔 Adult Three states in which we fall for it more easily [P] (⚠ the authors' summary, without a separate source):
- we are in a hurry — under pressure we think more superficially;
- we want to belong — "everyone in the group is making money";
- we have a problem — debt, loss, loneliness; the fraudster offers a "way out".
A practice that works [P]: the 24-hour rule for any financial decision that a stranger has led you to. One night costs nothing and can save everything.
Myth → truth
- Myth: "Only the naive and the uneducated get scammed."
- Truth: people with education and experience get scammed. Fraudsters attack the moment, not the intellect.
Who profits? The fraudster — from speed. You — from the pause.
→ Continue at the source
- Robert Cialdini, Influence: The Psychology of Persuasion (1984) ✔ — through the Guide.
- Europol — "Online fraud schemes" — https://www.europol.europa.eu/crime-areas/online-fraud-schemes ✔ (opened 21.10.2026)
Chapter 2 · Ponzi and pyramid schemes: the scheme that always collapses
👧 Child Imagine a game in which everyone has to bring six more friends to get a prize. Soon there will be no more friends. The game ends, and the ones at the bottom get nothing.
🧑 Teenager There are two well-known forms:
- A Ponzi scheme — the money of new investors is paid out to old ones as "profit". There is no real business behind it. It is named after Charles Ponzi, who in Boston in 1919–1920 promised high profits in a short time through "international reply coupons" ✔ (the scheme collapsed in 1920).
- A pyramid scheme — you earn not from a product but from recruiting new members, each of whom pays to get in.
Both collapse when the new money stops.
🧔 Adult The mathematics of a pyramid is simple. If everyone recruits 6 new members:
- level 1: 6 · level 2: 36 · level 3: 216 · … · level 10: 6¹⁰ = 60,466,176 people;
- level 13: 6¹³ = 13,060,694,016 — more than the population of the Earth.
That is why most people in any pyramid cannot get their money back — structurally, there are not enough new members. This is arithmetic, not opinion (✔ calculated; see also Module 7, Chapter 9).
In the EU, "establishing, operating or promoting a pyramid promotional scheme where a consumer gives consideration for the opportunity to receive compensation that is derived primarily from the introduction of other consumers into the scheme rather than from the sale or consumption of products" is one of the commercial practices that are unfair in all circumstances (Unfair Commercial Practices Directive 2005/29/EC, Annex I, point 14) ✔ (official text, publications.europa.eu, CELEX 32005L0029, opened 21.10.2026 — the quotation is word for word).
The biggest known example: Bernard Madoff, arrested in December 2008 and sentenced in 2009 to 150 years in prison for a Ponzi scheme with paper "profits" of tens of billions of dollars ✔ (arrested 11.12.2008, sentenced 29.06.2009). Madoff was a respected financier — the fraud was not visible from outside.
Example: Bulgaria — In the 1990s, "quick-profit companies" (the so-called financial pyramids) operated in Bulgaria too and left investors without their money (see also the crisis of 1996–97 in Module 2) ⚠ (according to newspapers of the time, e.g. Kapital, 1995; no official primary source was found). Names, sums and dates are added only from primary sources (court rulings, the Bulgarian National Bank (BNB, БНБ), the Ministry of Finance) — here, the conclusion: "everybody's doing it" is the most dangerous signal.
Check in your country — Has your country had its own pyramid schemes? The reports of the central bank, the financial supervisor and the courts are the reliable sources — not forums.
Myth → truth
- Myth: "I'll get in early and get out before the collapse."
- Truth: nobody on the inside knows when the end is. The first ones profit because the next ones lose. If you earn from recruiting people, you are not an investor but a recruiter — and you carry legal responsibility (Chapter 9).
Who profits? The founder and the early participants. Everyone else pays for them.
→ Continue at the source
- U.S. SEC, Investor.gov — "Ponzi Scheme" and "Pyramid Scheme": https://www.investor.gov/protect-your-investments/fraud/types-fraud/ponzi-scheme ✔
- EU — Directive 2005/29/EC (unfair commercial practices), Annex I, point 14: https://eur-lex.europa.eu/eli/dir/2005/29/oj ✔
- Bulgaria: the chronology of 1996–97 — BNB, annual reports (✔ see Module 2).
Chapter 3 · "Guaranteed high returns": the red flags
👧 Child If someone says "give me €10 and tomorrow I'll give you back €100", ask: "Where will you get it from?" If they don't know or get annoyed — don't give.
🧑 Teenager Here are the flags that supervisors describe [F] (✔ the SEC and the Bulgarian Financial Supervision Commission say it in different words):
- guaranteed high returns with no risk — in reality, high returns always mean high risk;
- steady "profit" with no ups and downs — real investments go up and down;
- a seller without a licence;
- pressure to decide quickly;
- seminars with free food and gifts (✔ this is how the SEC describes the ways people are drawn in);
- it is unclear what the product actually is — "an algorithm", "a secret strategy".
🧔 Adult The basic rule we already met in Module 3: "High returns and no risk = you are the product." Practical questions before any investment [P]:
- Who is the licensed provider? (the register of your national financial supervisor)
- Where does the income come from? Is it real activity, or other people's money?
- Can I get out and take my money? When, on what terms?
- What is on paper? A contract, a prospectus, a key information document (KID, under the EU PRIIPs Regulation).
- Can everything be lost? If the answer is "no" — red flag.
Myth → truth
- Myth: "Some people know a secret for making profits."
- Truth: if a secret led to high guaranteed returns, they would not sell it to strangers.
Who profits? The seller — from the fee and the commission. You profit when you ask where the income comes from.
→ Continue at the source
- Your national financial supervisor — registers and warnings. Example: Bulgaria — Financial Supervision Commission (FSC, КФН): https://www.fsc.bg ✔
- EU — Regulation (EU) No 1286/2014 (PRIIPs, key information document) ✔.
Chapter 4 · Fraud on social media: fake advisers, fake faces
👧 Child On the internet, someone can have a lovely picture that isn't theirs. If a stranger asks you for a present, money or a secret — tell a grown-up.
🧑 Teenager The most common moves:
- an "influencer" with "signals" — wants you to pay for "membership" in a group with winning trades;
- a fake profile of a famous person who "recommends" a platform;
- "love and investment" — someone you have chatted with for weeks starts talking about a "safe investment";
- artificial intelligence makes faces and voices — a video of a celebrity or the voice of someone close to you may be fake ✔ (ESAs — joint factsheet on online fraud in the age of AI, 15.12.2025, opened 21.10.2026).
🧔 Adult The European Securities and Markets Authority (ESMA) urges social media companies to stop advertising unregistered financial services — a common door to fraud with imitation news, names of famous people and fake "experts" ✔ (https://www.esma.europa.eu/press-news/esma-news/esma-urges-social-media-companies-tackle-unauthorised-financial-ads). Protection [P]:
- reverse image search and a check of the profile (when it was created, how "alive" it is);
- do not move to a "private channel" (Telegram, WhatsApp) at a stranger's invitation;
- do not pay a "fee" to withdraw your "profit" — that is the second fraud on top of the first;
- check the licence (Chapter 8).
Myth → truth
- Myth: "I saw a video of a famous person recommending it — so it's true."
- Truth: voices and faces can be faked. Check in the person's official channel, not in the advert.
Who profits? Whoever places the advert and runs the "private channel". The platforms earn from the adverts; they do not always check them in time.
→ Continue at the source
- ESMA, EBA, EIOPA — warnings to consumers (incl. the joint ones of 06.10.2025 and 15.12.2025): https://www.esma.europa.eu/investor-corner/warning-and-publications-investors ✔ (opened 21.10.2026); the factsheet on fraud and AI: https://www.esma.europa.eu/node/224630 ✔
- Europol — "Online fraud schemes": https://www.europol.europa.eu/crime-areas/online-fraud-schemes ✔ (opened 21.10.2026).
Chapter 5 · Crypto fraud and "investment platforms"
👧 Child Some websites say: "buy digital coins, they'll be worth a lot". They are not like the coins in your piggy bank. Ask a grown-up before you give anything.
🧑 Teenager In the crypto world, frauds repeat themselves:
- fake platforms — an app with "profits" and a "balance", but you cannot withdraw any money;
- rug pull — the creators of a new token pull out all the buyers' money;
- fake "pre-sales" of tokens;
- phishing — a fake wallet page that steals the keys.
This topic is covered in detail in Module 5. Here, remember: if something is only a "promise" and a "price", with no right, company or profit behind it, it is not an investment — it is gambling.
🧔 Adult The regulatory framework [F]:
- The MiCA Regulation (Regulation (EU) 2023/1114) requires authorisation for crypto service providers. ESMA keeps a register of the licensed ones (✔ see Module 5).
- Firms that operated under national law before 30.12.2024 could continue until 1.07.2026 at the latest, or until they were authorised or refused; their customers did not have MiCA protection during this transitional period (✔ ESMA/EBA, 06.10.2025).
- The joint warning by the ESAs (EBA, EIOPA, ESMA) of 06.10.2025: the protection of crypto holders is limited or absent — it depends on the asset; compensation schemes may not apply (✔).
Example: Bulgaria — The transition ended on 1.07.2026 — notice of the Financial Supervision Commission (FSC) ✔ (see Module 5).
Check in your country — Which authority licenses crypto-asset service providers where you live, and when did the transitional period end? Look up any provider in the ESMA register before you transfer money.
The practical question: is the provider licensed in the ESMA register? Not "does it sound convincing?".
Myth → truth
- Myth: "The platform shows profits, so it works."
- Truth: the numbers on the screen are just numbers. The real test is: can you withdraw money to your bank?
Who profits? The operator of the fake platform — from "withdrawal fees". You profit only from checking before you pay in.
→ Continue at the source
- ESMA — ESAs warning of 06.10.2025: https://esma.europa.eu/press-news/esma-news/eu-supervisory-authorities-warn-consumers-risks-and-limited-protection-certain ✔
- EUR-Lex — MiCA: https://eur-lex.europa.eu/eli/reg/2023/1114/oj ✔
Chapter 6 · Loans, "buy now, pay later" and quick loans
👧 Child "Take it now, pay later" sounds sweet, but "later" comes. Before you take something, ask: "How much will it all cost in the end?"
🧑 Teenager "Buy now, pay later" (BNPL) splits the price into instalments. What is hidden is that many small instalments easily pile up in the budget. Quick loans show the instalment, not the price of the whole loan (the APR — Module 7).
🧔 Adult Red flags with credit [P]:
- "no checks" and "approval in minutes" — often at a high price;
- a "processing" fee paid in advance — a legal company does not ask for money before it lends; an upfront fee is a classic sign of fraud ✔;
- the APR is hidden — by law, consumer credit comes with mandatory standard European information before the contract (Directive 2008/48/EC; from 20.11.2026 — Directive (EU) 2023/2225) ✔;
- a loan from a stranger on social media.
What to do: ask for the APR and the total amount, compare with at least one other offer (Module 7), check the lender's licence or registration.
Example: Bulgaria — Non-bank lenders are not licensed but entered in the register of financial institutions kept by the Bulgarian National Bank (BNB) — check the entry ✔ (the register under Article 3a of the Credit Institutions Act: https://www.bnb.bg/RegistersAndServices/RSFIRegister/index.htm, opened 21.10.2026).
Check in your country — Who authorises or registers non-bank lenders where you live (the central bank, the financial supervisor or the consumer protection authority)? Look the lender up in that register before you sign.
Myth → truth
- Myth: "A small instalment is a small cost."
- Truth: a small instalment can go on for many years; what matters is the total at the end.
Who profits? The lender — from interest and fees. You — when you compare the APR.
→ Continue at the source
- Directive 2008/48/EC — consumer credit (APR, standard form) ✔ · from 20.11.2026 — Directive (EU) 2023/2225: https://eur-lex.europa.eu/eli/dir/2023/2225/oj
- Bulgaria: BNB — register of financial institutions — https://www.bnb.bg ✔
Chapter 7 · Bank fraud: codes, the "safe account", phishing
👧 Child The PIN of a card is a secret word. You don't tell it to anyone — not even to a "bank employee" on the phone.
🧑 Teenager Three well-known lies:
- Phishing — a message or email "from the bank" with a link to a fake page;
- A fake employee — calls "from the bank" or "from the police": "there is a suspicious transaction";
- The "safe account" — they persuade you to transfer your money to a "protected" account to keep it safe from "hackers".
The truth: a real bank will never ask you for your PIN or a code from a text message, or ask you to move money to a "safe account".
🧔 Adult Rules [P]:
- Hang up and call back yourself on the number on the back of the card or on the official website.
- Never share codes from text messages, your PIN or full card details.
- Do not install remote-access apps on your phone at the request of an "employee".
- Limits in the app — set sensible daily limits.
- If you have transferred money: immediately call the bank and report it (Chapter 8). Time is decisive.
Myth → truth
- Myth: "The fraudster knows my name and my account — so they must be from the bank."
- Truth: data has often leaked from elsewhere. Knowing a name is not proof.
Who profits? The fraudster — from speed. You — from hanging up.
→ Continue at the source
- Your bank — on its official website — and your country's banking association or central bank. Example: Bulgaria — Association of Banks in Bulgaria — security advice — https://abanksb.bg ✔; BNB — warnings about fraudulent calls and messages in the bank's name (e.g. of 18.04.2024): https://bnb.bg/AboutUs/PressOffice/POPressReleases/POPRDate/PR_20240418_BG (in Bulgarian) ✔ (opened 21.10.2026).
Chapter 8 · How to check and where to report
👧 Child When something worries you, tell a grown-up you trust: a parent, a teacher, an uncle. This is not "telling tales" — it is protection.
🧑 Teenager Checking in three steps:
- Who is it? A company — in the companies register. A licence — in the register of the financial supervisor.
- What do they promise? Write the promises down.
- What happens if I leave? Ask in writing.
🧔 Adult Where to check and where to report — the kinds of institution that exist in every EU country [P]: | What | Where | |---|---| | Licensed financial firms and warnings | the national financial supervisor (and the central bank for banks) | | Licensed crypto service providers in the EU | ESMA — register (MiCA) | | Non-bank lenders | the register kept by the central bank or the supervisor | | Commercial registration of a company | the national companies register | | Fraud with a transfer/card | the bank immediately, then the police | | Cybercrime | the police — the cybercrime unit | | Consumer disputes | the consumer protection authority |
Example: Bulgaria — the addresses were checked on 19.10.2026 ✔:
What Where Licensed financial firms and warnings Financial Supervision Commission (FSC) — https://www.fsc.bg Licensed crypto service providers in the EU ESMA — register (MiCA) Non-bank lenders BNB — register of financial institutions Commercial registration of a company Commercial Register — Registry Agency Fraud with a transfer/card the bank immediately, then the police Cybercrime Ministry of Interior — General Directorate Combating Organised Crime, Cybercrime Department — reports at https://www.cybercrime.bg ✔ (according to the Ministry's page, opened 21.10.2026) Consumer disputes Consumer Protection Commission (CPC, КЗП) — https://kzp.bg ✔ Check in your country — Write down now, before you need them: the emergency number of your bank, the police cybercrime reporting page, the website of your financial supervisor and of your consumer protection authority. Europol's page on online fraud links to the national reporting points.
Gather evidence: screenshots, account numbers, dates, the correspondence. Do not delete the conversations.
If you have lost money — don't be ashamed. Shame is the fraudster's main ally: it stops people from reporting.
Myth → truth
- Myth: "There's no point in reporting — the money won't come back."
- Truth: a report sometimes stops the scheme, protects others and is a condition for compensation. Speed matters.
Who profits? Whoever reports quickly.
→ Continue at the source
- ESMA: https://www.esma.europa.eu ✔ · Europol — "Online fraud schemes": https://www.europol.europa.eu/crime-areas/online-fraud-schemes ✔
- Bulgaria: FSC: https://www.fsc.bg · BNB: https://www.bnb.bg · Commercial Register: https://portal.registryagency.bg ✔
Chapter 9 · The law and the joke: what the Criminal Code thinks
👧 Child There are rules that say you must not lie about money. Whoever does it is held responsible.
🧑 Teenager Fraud is a crime. Criminal law is national — every country defines fraud in its own criminal code, but the core is similar everywhere: someone deliberately deceives another person, or keeps them deceived, in order to gain property, and causes them a loss (*) (a general principle). At EU level, consumer law adds one more rule: running or promoting a pyramid scheme is an unfair commercial practice in all circumstances (Directive 2005/29/EC, Annex I, point 14) ✔ (Chapter 2).
Example: Bulgaria — The Bulgarian Criminal Code describes fraud like this: with the aim of obtaining a property benefit for yourself or for another, you arouse or maintain a mistaken belief in someone and thereby cause them or another person property damage (Criminal Code, Article 209(1)) ✔ (text on lex.bg, opened 21.10.2026). The penalty is heavier, for example, when the fraud is committed by two or more people who agreed in advance, or the damage is large (Criminal Code, Article 210) ✔.
Check in your country — Look up how your criminal code defines fraud, and where you report it: the police (often a special unit for cybercrime and economic crime) or the prosecutor's office. If you were drawn in through an investment offer, also tell your financial supervisor.
🧔 Adult Three practical conclusions [F]:
- You are not "just a participant". If you draw others into a scheme that is a fraud, you may be held responsible together with the organisers.
- Civil liability (getting the money back) is separate from criminal liability.
- Limitation periods and evidence. The earlier you report, the better.
This is not legal advice. For a specific case — a lawyer.
That is why the module's motto is a joke with a serious core: "How to Get Rich Quick" + the Criminal Code is the only "set" that warns you in time.
Myth → truth
- Myth: "If everyone does it, it's not a crime."
- Truth: the law does not vote by majority. Fraud is still fraud.
Who profits? Whoever is on the right side of the law and knows where it lies.
→ Continue at the source
- EU — Directive 2005/29/EC, Annex I, point 14: https://eur-lex.europa.eu/eli/dir/2005/29/oj ✔
- Bulgaria: Criminal Code (Articles 209–210) — https://lex.bg/laws/ldoc/1589654529 (in Bulgarian) ✔ (opened 21.10.2026); Prosecutor's Office of the Republic of Bulgaria — information on fraud — https://prb.bg ✔
Chapter 10 · Your rights as a consumer and where to look for advice
Levels: B — "I have the right to ask and to say no" · I — the deadlines and the complaint · A — the out-of-court routes and the adviser who does not sell.
👧 Child If you buy something and it doesn't work, you have the right to say: "This isn't right." Go with a grown-up and the receipt. Asking is not rude.
🧑 Teenager Four rights that apply across the EU:
- 14 days to withdraw from an online purchase (at a distance) — without saying why ✔. It does not apply to everything (for example food or made-to-measure orders).
- 2 years of seller's liability for goods that turn out to be faulty ✔.
- 14 days to withdraw from a consumer credit agreement, including "buy now, pay later" ✔ (Module 7).
- A payment you did not make — tell the bank immediately, at the latest within 13 months ✔.
🧔 Adult The route of a complaint — in this order [P]:
- In writing to the company or the bank. Describe the problem, attach the documents (Module 9, Chapter 9), ask for a specific solution and keep a copy. The bank must answer a complaint about a payment service within 15 business days ✔. Out-of-court bodies usually do not accept a dispute unless you have first tried to settle it with the trader ✔.
- Out of court — free of charge: - the national alternative dispute resolution (ADR) body for payment disputes — for disputes with banks and payment institutions; every bank must name it ✔; - the consumer protection authority and the national ADR bodies — for goods and services ✔; - the financial supervisor or the financial ombudsman — for insurers, investment firms and pension funds ✔; - the European Consumer Centre — when the seller is in another EU country ✔.
- The court — when the amount is worth it; the limitation period is running (Module 9, Chapter 9).
Note: the old European online dispute resolution (ODR) platform was closed on 20.07.2025 ✔. If a website still refers to it, the website is out of date.
Example: Bulgaria — For payment disputes there is the Conciliation Committee for Payment Disputes at the Consumer Protection Commission (CPC). The procedure is in writing, without fees, and the decision is not binding ✔. For goods and services — the CPC and its conciliation committees: https://kzp.bg ✔; for insurers, investment intermediaries and pension funds — the Financial Supervision Commission (FSC): https://www.fsc.bg ✔. The Bulgarian articles (text on lex.bg, opened 21.10.2026): Consumer Protection Act, Article 50 — 14 days to withdraw from a distance contract; Consumer Credit Act, Article 29 — 14 days to withdraw from a consumer credit; Payment Services and Payment Systems Act, Article 174 — answer to a complaint within 15 business days, then the Conciliation Committee for Payment Disputes at the CPC (Article 175) ✔. ⚠ The deadlines for the conciliation committees' decisions have not been checked (they are set in secondary rules that were not opened).
Check in your country — Which ADR body handles payment disputes, and which ones handle goods and services? The European Commission keeps a list by country (link below). Where is your European Consumer Centre?
Where to look for advice — and how to recognise whose interest it serves (Module 9, Chapter 6): | Who | Is it free? | Whose interest | |---|---|---| | Consumer protection authority, European Consumer Centre, ADR bodies | yes | the public interest | | Consumer organisations | usually yes | consumers' | | The bank, the insurer, the broker on commission | "free" | selling a product | | A paid adviser by the hour, a lawyer | no | yours — if they take no commission |
Rule [P]: ask "How are you paid for this advice?". An honest adviser answers straight away.
Myth → truth
- Myth: "Complaining is a waste of time — they're stronger."
- Truth: a written complaint is the first step towards the free out-of-court routes. Without it, those routes are closed.
Who profits? Companies, when customers don't know the deadlines. Deadlines expire quietly.
→ Continue at the source
- Your Europe — your rights when shopping and returning goods: https://europa.eu/youreurope/citizens/consumers/shopping/returns/index_en.htm ✔
- European Commission — the network of European Consumer Centres: https://commission.europa.eu/live-work-travel-eu/consumer-rights-and-complaints/resolve-your-consumer-complaint/european-consumer-centres-network-ecc-net_en ✔
- European Commission — out-of-court dispute resolution bodies (e.g. the Bulgarian Conciliation Committee for Payment Disputes): https://consumer-redress.ec.europa.eu/dispute-resolution-bodies/bulgaria-pomiritelna-komisiya-za-platezhni-sporove-km-komisiya-za-zashchita-na-potrebitelite_en ✔
- Bulgaria: CPC: https://kzp.bg ✔ · FSC: https://www.fsc.bg ✔
Sources
- ✔ Directive 2011/83/EU (consumer rights) — 14 days to withdraw from a distance contract (according to Your Europe).
- ✔ Directive (EU) 2019/771, Article 10 — 2 years.
- ✔ Directive (EU) 2023/2225, Article 26 — 14 calendar days to withdraw from a credit agreement.
- ✔ Directive (EU) 2015/2366, Article 71 (13 months) and Article 101 (answer within 15 business days).
- ✔ Conciliation Committee for Payment Disputes (Bulgaria) — in writing, without fees, the decision is not binding; requires a prior attempt with the trader (the European Commission's page on out-of-court dispute resolution bodies).
- ✔ The ODR platform — closed on 20.07.2025 (Regulation (EU) 2024/3228; according to legal overviews and a page of ECC Malta).
- ✔ The Bulgarian articles (text on lex.bg, opened 21.10.2026): see the box "Example: Bulgaria" above. ⚠ The deadlines for the conciliation committees' decisions have not been checked.
Chapter 11 · The regulators: who protects what
Level: B · I · A EU/OECD-INFE framework 2022 · competences no., topic 4.1 "regulation and consumer protection": 403–430 ✔ (according to the text of the framework; the topic "rights and responsibilities", 4.2, is 431–443).
👧 Child When you play a game with rules, there is a referee who watches that it is fair. With money there are "referees" too — institutions that make sure banks, insurers and shops keep to the rules.
🧑 Teenager Different institutions protect different things. In almost every EU country you will find:
- banks and payments — the central bank (and, for large euro-area banks, the European Central Bank) ✔;
- the non-bank financial sector — insurance, investment firms and funds, pensions — a financial supervisor (in some countries the same body as the central bank) ✔;
- consumer rights when buying goods and services — a consumer protection authority ✔;
- personal data — a data protection authority ✔;
- taxes and social security — a tax authority and a social security institute ✔;
- competition between companies — a competition authority ✔.
🧔 Adult Who to turn to — by type of problem [P]:
| The problem is with… | Who to turn to | What you can get |
|---|---|---|
| an account, a card, a transfer, a bank loan | first the bank itself (a written complaint), then the national ADR body for payment disputes and the central bank as supervisor | an answer from the bank within 15 business days ✔ (Directive (EU) 2015/2366, Article 101); an out-of-court decision |
| a non-bank lender | the register of the central bank or the supervisor | a check whether it is registered |
| insurance, an insurance intermediary | the financial supervisor; its register | a check of the licence; a report |
| an investment service, a fund, a pension company | the financial supervisor; its registers | a check of the licence; a report |
| a trader, an online shop, a service contract | the consumer protection authority | a complaint; out-of-court dispute resolution |
| leaked personal data | the data protection authority | a complaint under the GDPR |
| taxes, tax returns | the tax authority | guidance, appeal |
Example: Bulgaria — The institutions ✔: banks and payments — Bulgarian National Bank (BNB); the non-bank financial sector — Financial Supervision Commission (FSC), "a single body for regulation and supervision of the non-bank financial sector" (according to FSC documents); consumer rights — Consumer Protection Commission (CPC,
kzp.bg); personal data — Commission for Personal Data Protection (CPDP,cpdp.bg); taxes and contributions — National Revenue Agency (NRA,nra.bg) and National Social Security Institute (NSSI,noi.bg); competition — Commission on Protection of Competition (cpc.bg).
The problem is with… Who to turn to What you can get an account, a card, a transfer, a bank loan first the bank itself (a written complaint), then the Conciliation Committee for Payment Disputes at the CPC ✔ (for payments) and the BNB as supervisor, which also investigates on a complaint or report ✔ (Payment Services and Payment Systems Act, Article 167) an answer from the bank within 15 business days ✔; an out-of-court decision — without fees, not binding ✔ a non-bank lender registration is with the BNB (register of financial institutions) ✔ a check whether it is registered insurance, an insurance intermediary FSC; register of insurers and intermediaries (fsc.bg) ✔ a check of the licence; a report an investment service, a fund, a pension company FSC; registers (fsc.bg) ✔ a check of the licence; a report a trader, an online shop, a service contract CPC ( kzp.bg) ✔a complaint; out-of-court dispute resolution through the conciliation committees ✔ leaked personal data CPDP ( cpdp.bg) ✔a complaint under the GDPR taxes, tax returns NRA ( nra.bg)guidance, appeal Check in your country — Make your own version of the table: for each row, write the name and website of the authority in your country. Your bank's terms must name the ADR body for payment disputes; the European Commission's Your Europe portal lists the national contact points.
At European level: monetary policy and the supervision of large banks in the euro area — the European Central Bank (ECB); the common rules — the European Banking Authority (EBA), the European Securities and Markets Authority (ESMA) and the European Insurance and Occupational Pensions Authority (EIOPA). They issue joint warnings to consumers (for example on crypto-assets, 06.10.2025 ✔). The old European online dispute resolution (ODR) platform was closed on 20.07.2025 ✔ (European Commission — Consumer Redress, opened 21.10.2026).
Myth → truth
- Myth: "If a company has a nice website and a licence, it is safe."
- Truth: a licence means that the company has been admitted and is supervised; it does not guarantee a profit and does not replace your own checks (Module 17, Chapter 3).
Who profits? Whoever knows who to turn to — saves time. Institutions act on complaints; the clearer the report and the better documented, the faster it is dealt with.
→ Continue at the source
- ESMA/EBA/EIOPA — joint warning, 06.10.2025: https://esma.europa.eu/press-news/esma-news/eu-supervisory-authorities-warn-consumers-risks-and-limited-protection-certain ✔.
- Bulgaria: FSC — https://www.fsc.bg (registers and warnings) ✔ (opened for the registers); BNB — https://www.bnb.bg ✔; CPC — https://kzp.bg ✔ (corrected:
cpc.bgis the address of the Commission on Protection of Competition, not of the CPC); CPDP — https://cpdp.bg ✔; NRA — https://nra.bg ✔; Commission on Protection of Competition — https://www.cpc.bg ✔.
Your step in Pecuvo: in your wallet notes, keep a "Who is who" list — for every service you use, who supervises it and where the register is.
The iron principle of the module
High returns without risk, pressure to decide quickly and "don't tell anyone" — these are the signatures of fraud. Stop, wait 24 hours, check the register, tell someone you trust.
- 👧 Child: the secret word is not told; we ask a grown-up.
- 🧑 Teenager: "where does the income come from?" and "can I get out?"
- 🧔 Adult:
- a 24-hour pause for any decision a stranger has led you to;
- the register before the transfer;
- the codes stay with you;
- report immediately.
Your step in Pecuvo: (1) In your wallet notes, make a "Checklist" with the five questions from Chapter 3. (2) Add a "Quarantine" space — amounts that are "on a 24-hour pause"; if after 24 hours it still asks to be paid, go through the checklist. (3) Save your bank's phone numbers and the addresses of your financial supervisor, your central bank and ESMA in an "Emergency" space.
Check yourself (3 questions per level)
- 👧 1. What do you do if a stranger asks for a password? 2. Why do we tell a grown-up? 3. What is a "secret word"?
- 🧑 1. What is the difference between a Ponzi scheme and a pyramid scheme? 2. What are the five steps of fraud? 3. What is a "safe account", and why is it a lie?
- 🧔 1. Why does 6¹³ show that a pyramid cannot pay everyone back? 2. Which five questions do you ask before you invest? 3. Where do you check the licence of a crypto provider and of a financial firm?
Sources (summary)
- ✔ ESAs warning 06.10.2025; ✔ MiCA (Regulation (EU) 2023/1114); ✔ Directive 2005/29/EC, Annex I, point 14 (official text, publications.europa.eu, CELEX 32005L0029, 21.10.2026); ✔ the arithmetic of the pyramid (6¹⁰ = 60,466,176; 6¹³ = 13,060,694,016); ✔ SEC — signs of a Ponzi scheme (guaranteed high returns, unlicensed seller, steady "returns", seminars).
- Checked on 19.10.2026 (the ✔/⚠ status is given on each line above): Cialdini (1984); Ponzi (1919–1920); Madoff (2008–2009); Bulgarian Criminal Code, Article 209; Directive 2008/48/EC; Regulation (EU) No 1286/2014; registers of the FSC, BNB, ESMA; Bulgarian Ministry of Interior, CPC, Europol.
- (*) The general definition of fraud in national criminal law (Chapter 9) — a general principle, not checked country by country.