MMM ‘Ponzi scheme’ is spreading
While controversial ‘donation platform’ MMM is under investigation by the Hawks in South Africa, the alleged Ponzi scheme has spread to Nigeria.
The scheme has reportedly collapsed in Zimbabwe after terminating its services – leaving ‘thousands’ of participants out of pocket.
The Reserve Bank of Zimbabwe has warned people that the scheme was fraudulent, while mobile payment platform EcoCash has also distanced itself from MMM.
MMM describes the its presence in Nigeria, as ‘fast growing’ in its latest community newscast, while continuing to promote its presence in South Africa, despite having collapsed here earlier in the year.
The original MMM (Mavrodi Mondial Moneybox) collapsed in the late 1990s, having lost investors millions of dollars. Masterminded by former Russian politician – and convicted fraudster – Sergey Mavrodi, it started up again and first reached South Africa in 2015.
The Central Bank of Nigeria (CBN) has warned against MMM. The bank’s communications director, Isaac Okoroafor, said: “There is a new Ponzi scheme called ‘MMM’ that is spreading like wildfire.
“These people always come with very interesting propositions. These are fraudsters who are just out there to collect people’s money and run away as soon as they hit their target.
MMM is currently under investigation by the Hawks, with the National Consumer Commission listing it as a potential pyramid scheme.
The Consumer Protection Act describes any scheme that offers returns 20% above the repo rate (6.25%) as a “multiplication scheme” – otherwise known as a Ponzi scheme.
An MMM newscast shows South African members of the scheme continuing to recruit new members.
According to the newscast host, members are teaching people about the ‘ideology of MMM’and are encouraging new and old participants to ‘provide help using Bitcoin rather than other banks.
“Thre reason for this is that PH’s done with Bitcoins, come out faster than those done with other banks,” the host said.
South African banks have responded to questions about MMM.
More on MMM
SARB warning on MMM and other dodgy schemes
Beware of MMM – before it’s too late: Consumer Commission
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