It is obvious that many Nigerians are
getting aware of this current Pyramid scheme trending in Nigeria called MMM
Nigeria which promises 30% Return on Investment(ROI) after 30 days.
I
called the business a Pyramid/Ponzi scheme, Yes I did. Why would drizzymadbet
call it a Pyramid/Ponzi Scheme ? First let’s examine what a Ponzi/Pyramid
scheme is one should be wary of MMM Nigeria
A Ponzi scheme (also a Ponzi game or a
Ponzi) is a fraudulent investment operation where the operator, an individual
or organization, pays returns to its investors from new capital paid to the
operators by new investors, rather than from profit earned through legitimate
sources. Operators of Ponzi schemes usually entice new investors by offering
higher returns than other investments, in the form of short-term returns that
are either abnormally high or unusually consistent.
Initially the promoter will pay out
high returns to attract more investors, and to lure current investors into putting
in additional money. Other investors begin to participate, leading to a cascade
effect. The “return” to the initial investors is paid out of the investments of
new entrants, and not out of profits. Often the high returns encourage
investors to leave their money in the scheme, with the result that the promoter
does not have to pay out very much to investors; he simply has to send them
statements showing how much they have earned. This maintains the deception that
the scheme is an investment with high returns.
Unraveling of a Ponzi scheme
When a Ponzi scheme is not stopped by
the authorities, it sooner or later falls apart for one of the following
reasons.
1. The promoter vanishes, taking all
the remaining investment money.
2. Since the scheme requires a
continual stream of investments to fund higher returns, once investment slows
down, the scheme collapses as the promoter starts having problems paying the
promised returns (the higher the returns, the greater the risk of the Ponzi
scheme collapsing). Such liquidity crises often trigger panics, as more people
start asking for their money, similar to a bank run.
3. External market forces, such as a
sharp decline in the economy (for example, the Madoff investment scandal during
the market downturn of 2008), cause many investors to withdraw part or all of
their funds.
Why do I drizzymadbet believe that MMM
Nigeria is a pyramid/Ponzi scheme?
Lets look at the following reasons.
1. The promise of a 30 % ROI is
outrageous and not in terms with standard rates of
investment (Example one
makes a profit of 30,000 naira for every 100,000 naira invested in the system
in 30 days , excluding additions that comes from referral, signing up and
testimonial bonuses) No legal financial company can offer you that investment
plan.
2. Such “Return on Investments” been
paid to older clients are money received from new clients and the circle
continues, the 30% is never made from company profits. That is why there is
aggressive ad campaign from the company(MMM Nigeria) paying massive additional
bonuses to recruiters that they call guiders to conduct seminars and deceive
gullible Nigerians into joining the scheme to keep the system alive.
3. The CEO of the company(MMM Nigeria)
Seigei Marvrodi is a convicted fraudster and had run similar fraud schemes in
Russia where he defrauded investors over a hundred billion dollars
Written by Drizzymadbet
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