As the economic recession continues to bite harder, Nigerians are
looking for ways to make more money and survive which is why
many are now looking up to MMM (Mavrodi Mondial Moneybox)
for survival.
The “Wonder Bank” scheme which promises 30 per cent Return
on Investment (ROI) after 30 days is really trending and more
and more people are investing their money daily.
All you hear is “MMM pays” and trust Nigerians to latch on to
anything that will give them free money especially in these hard
times. Just yesterday, reports surfaced that the federal
government of Nigeria is taking moves to shut down MMM
operations in Nigeria.
The Central Bank of Nigeria (CBN) has warned Nigerians against
patronizing the MMM scheme but all these warnings have fallen
on deaf ears.
Before you decide to join the ‘MMM gang’ and invest your money
in the scheme, here are things you need to know:
1. How it started and morphed into a Ponzi scheme
It was set up in 1989 by three Russians Sergei Mavrodi, his
brother Vyacheslav Mavrodi, and Olga Melnikova. The name
MMM was taken from the first letters of the three founders’
surnames. Initially, the company imported computers and office
equipment. MMM was accused of tax evasion in January 1992
which led to the collapse of MMM-bank, making it difficult for the
company to obtaining financing support for its operations.
MMM global was a Russian company that perpetrated one of the
world’s largest Ponzi schemes of all time, in the 1990s. A Ponzi
scheme is a fraudulent investing scam which promises investors a
large profit at little to no risk. The scheme generates returns for
older investors by acquiring new investors. In 1994, MMM
morphed into a successful Ponzi scheme.
2. 50 investors committed suicide in 1994 after it crashed
The police closed the offices of MMM for tax evasion on July 22,
1994. The company tried to continue the scheme but the business
shut. In the aftermath at least 50 investors who lost all of their
money committed suicide.
3. The CEO is a convicted fraudster
Seigei Marvrodi is a convicted fraudster who had run similar
fraud schemes in Russia. He was arrested in August 1994 for tax
evasion. In 2007, a Russian court found him guilty of defrauding
10,000 investors out of 110 million rubles (4.3 million US dollars).
He was sentenced to four and a half years in prison.
4. The current MMM Bitcoin version emerged in around 2011
Following Mavrodi’s release from prison, he launched another
pyramid scheme called MMM-2011 in January 2011. He asked
investors to buy so-called Mavro currency units. However, in May
2012, he froze the operation and announced that there would be
no more payouts.
5. It began operations in South Africa in 2015
With the same business model as MMM-2011, it started operations
in South Africa, promising a 30 per cent per month return
through a social financial network. A number of South African
banks are shutting down accounts they believe could be linked to
MMM. In May, Capitec bank reportedly closed 2000 bank accounts
linked to the MMM scheme.
6. MMM platform in Zimbabwe crashed
In September, reports surfaced that the scheme had crashed in
Zimbabwe and thousands of people lost their investment. It was
later reported that it did not crash but the reward was slashed
from 100 per cent to 20 per cent.
7. It has been banned in China
The Chinese government banned MMM in January 2016 on the
grounds that it is a pyramid scheme, (Ponzi scheme). According to
the government, it is not registered in the country (and it cannot
be registered as it is a fraudulent scheme).
8. Launched in 2016 in Nigeria
MMM launched a website targeting the Nigerian audience in July
2016. Since its launch, a good massive percentage of Nigerians
have invested in the scheme and more people are still joining.
9. There comes a time when it will crash
Businesses that fall under Ponzi scheme often run until it fails to
achieve the returns expected. Once investment slows down, the
scheme shuts down. Most of the time, the promoter vanishes into
thin air carting away all the investment money.
Many Nigerians will continue to defend the scheme and accuse
the government of a hidden agenda to stop their means of
income. However, people should be wise while investing in
business ventures that are too good to be true.
MMM gang would always say “MMM pays”, “MMM-Making More
Money”. It is paying at the moment but for how long?
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