Alarm bells ring over MMM scheme that has taken Nigeria by storm . . . COLLAPSE IMMINENT, say financial experts
Posted by News Express | 30 September 2016 | 3,585 times
Alarm bells are ringing over the ponzi-like get-rich-quick scheme known as MMM, which has in the past few months taken Nigeria by storm. News Express learnt that Nigerians, lured by the desire to make quick money in the face of economic recession, are trooping into the business the business in droves – some even borrowing millions of naira and investing in the scheme.
However, MMM will not last, according to concerned financial experts. One of them told News Express: “We have done the mathematics in our office and I can tell you that it will soon collapse. The scheme is not sustainable; there is no product being offered, no business into which the contributed money is being invested and no guarantee that the people will continue to register.”
The source noted that the MMM scheme has already in countries where it was tried previously, adding that Nigeria will not be an exception.
The latest example is Zimbabwe, where MMM has left thousands in financial ruin.
Already, the Securities and Exchange Commission (SEC) has issued a public alert against the investment scheme which also operates in Nigeria under the name ‘MMM Federal Republic of Nigeria’.
“The Mavrodi Mondial Moneybox (MMM) Global Zimbabwe is a scheme that advertises itself as a mutual aid fund with a promised monthly investment returns of 30 per cent,” said Taiwo Kola-Ogunlade, Google’s Communications and Public Affairs Manager for Anglophone West Africa on Friday.
“Under the scheme, members contribute money to assist others. However, it is a network that relies on growing numbers of new members to pay off the old.
“It is linked to a fraudulent history that goes as far back as 1989.”
According to SEC, MMM Federal Republic of Nigeria has embarked on an aggressive online media campaign to lure the investing public to participate in the scheme with a monthly investment return of 30 per cent.
The Commission explained that the operation of the investment scheme has no tangible business model hence it is a ‘ponzi scheme’ where returns are paid from other people’s invested sum.