A friend called me to tell me about the hottest investment in town that promises 50 percent return on investment within 30 days . A little inquiry into this investment revealed that it was another ponzi scam, in which investors are lured into committing their fund, with the hope of being among the early benefiters of the system before it crash.
I pondered on why i have to be super gullible to commit my hard-earned cash into a fraudulent system, with the possibility of loosing my money too.
Understanding Ponzi scheme
Ponzi is an investment fraud in which clients are promised a large profit at little to no risk. this scheme can only survive for a short period of time by generating returns for older investors by recruiting new investors, who are promised a large and mouth watering return on investment within a short period of time at little to no risk.
By Mervyn K. Lewis; Abstract: A Ponzi scheme is one of the simplest, albeit effective, financial frauds to engineer, and new schemes keep coming
Between 2016-2017, Africa was hit by the tsunami of a major fraudulent ponzi scheme called MMM. MMM which described itself as a “mavrodi mundial moneybox” had members from over 100 countries, and promised it’s investors 30% monthly interest rates with alot of exciting add-on benefits. This entity described itself as a mutual aid fund, where ordinary people help each other by ”Getting Help” and providing help” . This ideology was used to recruit over 3 million people in Nigeria alone until it crashed in december 2019, and left alot of people in debt that that may never be able to pay back.
MMM caused an increase in suicidal rate in Africa, after a lot of people lost borrowed money and their properties into the fraudulent scheme.
It’s been in the news that MMM is back and now promising 50 percent return on investment. Mavrodi mundial moneybox scheme recruiters who refer to themselves as ”guiders” are massively recruiting gullible investors, and with the option of earning referral bonus for whoever wishes to refer and recruit more investors for the scheme.
One of their advertisement post read ” Great News, MMM is back and better”