Nigerians have been warned against investing their money in MMM Global, a Russian Ponzi Scheme company that opened shop in Nigeria just months after it collapsed in South Africa.
According to a report by Pageone.ng, the establishment defrauded more than 40 million people of at least USD10 billion in Russia before being shutdown and declared bankrupt.
Less than three months after the company collapsed in South Africa, MMM Global, a Russian Ponzi Scheme company has opened shop in Nigeria with the domain name- nigeria-mmm.net
According to Wikipedia, MMM was established in 1989 by Sergei Mavrodi, his brother Vyacheslav Mavrodi, and Olga Melnikova. The name of the company was taken from the first letters of the three founders’ surnames.
Initially, the company imported computers and office equipment. In January 1992, tax police accused MMM of tax evasion, leading to the collapse of MMM-bank, and causing the company to have difficulty obtaining financing to support its operations. Faced with difficulties in funding its foreign trade, the company switched to the financial sector. It offered American stocks to Russian investors, but met with little success. Later, MMM-Invest was created for the purpose of collecting vouchers during privatisation. This effort was similarly unsuccessful.
MMM created its successful Ponzi scheme in 1994. The company started attracting money from private investors, promising annual returns of up to one thousand percent. It is unclear whether a Ponzi scheme was Mavrodi’s initial intention, inasmuch as such extravagant returns might have been possible during the Russian hyperinflation in such commerce as import-export.
Many Nigerians are not conversant with the fact that the company is fraudulent establishment that defrauded more than 40 million people of at least USD10 billion before being shutdown and declaring bankruptcy in Russia,” reports
As reported by Fin24, MMM Global in its usual manner operated a platform where its members are encouraged to donate money to others by rewarding them with the bitcoin-linked virtual currency – Mavros – in return, and can apparently get 30% return on their rand investment by doing so.
However, it is a known knowledge that a scheme is a Ponzi scheme when expected return is 20% higher than the repo rate. To the amazement of any reasonable person, many South Africans still fall prey despite the fact that the repo rate in SA is 7%.
MMM Global only gave South Africans the bad news with a post on its website saying “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 be able to pay 100% per month.”
How can a company that has been defrauding people since 1989 claim its scheme is an experiment in 2016?
I met a former colleague who has fall prey to the fraud. He was revealing in the phantom promise that his NGN100,000 will yield him additional 30% in return. I immediately alerted him that he has fallen for a Ponzi Scheme and that everything will soon blow up in his face.
To further delude their victims, MMM Global has been using propaganda and lies. My colleague narrated the origin of the company to me. Even a smart person will get carried away. The height of the idiocy was when he told me that MMM was closed down in Russia because the company became richer than the Russian government and all the banks put together.
A day before it collapsed in South Africa, BehindMLM, a website that reports news on Ponzi Schemes and Multi-level Marketing, MLM warned the public saying:
“The financial apocalypse is upon us, MMM Global has collapsed,”
“MMM Global’s Ponzi clones offering a lower percentage haven’t ‘proved’ themselves any more than MMM Global did,”
“MMM Global cannot sustain paying out more than is invested. And as long as affiliate investment is the only source of revenue entering the scheme, any MMM Global scheme will ultimately collapse.
“They’ll continue to pay ROIs (return on investments) until withdrawals exceed the rate of new investment, and then run out of money all the same. One only needs to look at the collapse of MMM China for evidence of what’s to come”.
“Unfortunately for most MMM Global investors, the collapse is the end of the line. Those unlucky enough to live in countries where MMM Global runs secondary scams (like South Africa), were informed their accounts would be transferred over.”
However, I am not surprised that Nigerians will fall prey to MMM Global. Ponzi Schemes are recurring decimals in the social history of Nigeria. From fraudulent investment clubs, to wealth solutions and other MLMs across the country.
In the midst of the banking boom, many Nigerian lost billions of Naira (NGN) to Ponzi Schemes who promised millions of the population superfluous interest rates close to 150% within 30 days.
A writer once accused many Nigerians of ‘momentary amnesia’, but in the midst of an economic crises, record inflation and ‘technical recession’, the lack of access to information by victims of such schemes seals their fate.
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