Joseph Osuji
Nigeria, one of the biggest countries in the globe with a population of over 188 million people living in it, is seen as the giant of Africa and in terms of its economy and human capacity.
With the fall
in global oil price, the country which depends majorly on its crude exportation
as a means of revenue generation has been hit with what economic analyst would
liken to the economic recession that hit Greece few years back.
According to
the National Bureau of Statistics, another 1.5 million Nigerians became
unemployed in the first quarter of 2016, and with unemployed rate tripling in
the last few months and youth unemployment also rising to 42.24 percent, the
country has witnessed a surge of about 15.2 million youth unemployment with a
slow in productivity as recorded by in the GDP.
With such
indices showing the level of poverty and unemployment in the country, Nigerians
are now looking for palliative measure that can help generate income to cushion
the effects of the present recession. With various online money making platforms
coming into existence, many Nigerians are now quick to jump into offer as long
as it promised bountiful reward without necessarily investigating the history
or antecedence of such organization.
One of such
online money making platform is the ponzi scheme known as MMM.
The question
now is what is MMM, is it legally backed by the financial laws of your country,
why has it gained much ground in the country, who are those behind the scheme
and what is the government saying about the scheme?
According to
Wikipedia, Ponzi scheme is an illegal investment scheme where the person or
organization running it pays returns to existing investors from capital paid
into it by new investors, rather than profit actually earned by the company
itself.
MMM on the
other hand according to the organizers of the scheme, is seen as a community
where people help each other, providing a practical policy to connect millions
of participants worldwide who need help and those who are ready to provide help
for free. The scheme which is based on participant’s honesty and kindness, and promises
investor 30% returns of their initial investment and with users receiving 10
percent from what the company refers to as all donations of the participants
you invite or for posting positive testimonials.
The scheme,
which started in Russia by Sergey Mayrodi, a Russian, in 1989, who was later convicted
for financial scheming and sentenced with a jail term of four and a half years
in April 2007, has gained much recognition in countries. The scheme which is
based on participant’s honesty and kindness with no legal backings has gained
tremendous ground in few countries like Russia, China, South Africa, Zimbabwe and
currently Nigeria where a large population of participants have signed up with
some pledging as much as a million naira in the scheme.
But recently,
there was a strong warning by the Director of Federal Financial Monitoring
Service (FFMS) in Russia warning China of a collapse of the scheme in the
country and on December 25 investors in the MMM China woke up to discover that
their accounts have been frozen and a statement on the site read thus: “investment
cycles and interest payments would be calculated differently in the future, and
all previous requests for withdrawals had been canceled” this lead to so many
people losing their money to the scheme.
Few weeks
later, the scheme came up with this statement to address the closure of the
Republic of Bitcon, the brain child behind the MMM saying;
"Dear
participants!
We regret to
inform you that we have to close down the Republic of Bitcoin. It was an
experiment, and, unfortunately, it failed. We turned out not to able to pay
100% per month. We can easily pay 30% per month (and we proved it in practice
in many countries), but 100% is too much even for us.
That’s why
the RB will be closed down.
All the
participants’ RB-Mavro are transferred to the MMM-structure of the countries
which the participants come from. If there is no MMM-structure working in this
country, it will be created within two weeks from the date of this
announcement.
All RB-Mavro
will be demonstrated as "old" Mavro in PO. Any operations with them
are impossible. Gradually, as your country will be developing, they will be
paid back. 10% of the total input of the system will be spent on repaying “old”
Mavro. This practice has already been tested in many countries and proved that
it works. It usually takes a half a year to pay back old" Mavro.
This news is
not very pleasant but there is nothing that can be done about it. It is not the
end of the world. We just have to wait a bit.
We hope for
understanding, Administration"
MMM has
opened in more countries as promised, also members of the Republic of bitcoin
are moved to their various countries MMM-structure while they wait for the
repaying of their "old" Mavro as promised by MMM. According to MMM
this could take up to 6 months.
With such breach
of trust for a scheme that depends solely on honestly and trust of its
participants, one would wonder if what happened to MMM China and the failed experimented
Republic of Bitcoin would not one day happen in MMM Nigeria where caution have
been thrown away by its participant even after the Nigerian financial
regulatory body, the Central bank of Nigeria (CBN) strong warnings on
activities of wonder banks and the Securities and Exchange Commission (SEC)
recent statement on the antecedence of the Ponzi scheme MMM:
“The
attention of the Securities and Exchange Commission, Nigeria (“SEC”) has been
drawn to the activities of an online investment scheme tagged ‘MMM Federal
Republic of Nigeria (nigeria.mmm.net). The platform has embarked on an
aggressive online media campaign to lure the investing public to participate in
what it called “mutual aid financial network” with a monthly investment return
of 30%”
“The
Commission hereby notifies the investing public that the operation of this
investment scheme has no tangible business model hence it’s a PONZI SCHEME
where returns are paid from other people’s invested sum. Also, its operation is
not registered by the Commission”.
“The general
public is hereby advised to distance themselves from this online scheme. Please
note that anyone that subscribe to this illegal activity does so at his/her own
risk” Ponzi schemes one still wonders why people are still trooping to sign up
with such scheme.
With these
warnings and recent happenings in China and Zimbabwe where the scheme has
failed, one still wonders why millions of Nigerians still troop to sign up with
the scheme.
The answer,
which is not farfetched, is as a result of participant of the scheme promoting MMM
through their numerous testimonies how the scheme has enriched their life and
helped to turn their fortunes around positively through testimonies on almost
all social media platform and even going as far as creating communities in
various geographical areas on Facebook with names like MMM Ikeja, MMM Nigeria
Community. While some are actively interested in the scheme, some investors due
to recent stories about the scheme have started pulling out their money. An
investor who spoke to Insidemainland on phone said “in this period of
recession, I cannot wait for my money to have stories or issues, because with
the way the scheme is going and what I have been hearing, I don’t think it will
last for a long time.”
For those
already signed up for MMM scheme and those who are been convinced to sign up
with the ponzi scheme, the question should be, would I be willing to part with
my money in this present economic crisis with a scheme with no legal backing,
that depends on solely of participants trust and honesty?
What if Nigerians
wake up and the site is no longer there as we have seen in many wonder banks
going into oblivion without a trace. These questions I think should be able to
guide participants of MMM scheme who have so much invested in it.
Investors of MMM
should take a clue to what happened in China and Zimbabwe recently so as to
avoid facing a much painful recession of their hard earned money to schemes
that are not legally backed by laws governing financial institutions in their
countries.
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