Scam Alert: Beware of the investment company MMM?

The Securities and Exchange Commission, Nigeria (SEC) recently rejected the activities of an investment scheme tagged MMM Federal Republic of Nigeria (nigeria-mmm.net). MMM has been widely regarded as a Ponzi scheme. The company claims to give 30 percent interest to their members each month and 10 percent upon referral of any new member. SEC warned that the company is not registered by the commission, and that business with them is high risk.
What you need to know about MMM’s Ponzi Scheme
MMM stands for Mavrodi Mondai Movement. The scheme was founded by Sergei Mavrodi in 1989 and was converted into a ponzi scheme. In 1994 the company went bankrupt and Mavrodi went into hiding until 2003. In 2007, a Russian court arraigned Sergei Mavrodi for defrauding 110,000 investors of 110 million rubies. He was sentenced to four and half years in a penal colony.
A Ponzi scheme is an illegal investment scheme where the person or organization running it pays returns to existing investors from capital paid into it by new investors, rather than profit actually earned by the company itself. The return to the initial investor is usually paid out of money paid in by new entrants.
Ventures Africa had a chat with one of MMM’s consultants simply identified as Daniel, he disclosed that the scheme already has 584, 627 members in Nigeria and that the numbers are increasing daily.
South Africa and China have banned MMM from their countries and warned citizens against it. The absurd thing is that when you join MMM, you do not pay your investment into a company account. Rather, you pay into a fellow members account, thereby making the probability of recouping your money, low.
Bernard Madoff, who organized the largest Ponzi scheme to date, conned about $65 billion from investors from all facets and was sentenced to 150 years imprisonment in 2009. In 1996, about 2000 people died due to losses made from a ponzi scheme in Albania.
Despite the warning by SEC, some Nigerians have continued to show their unrelenting willingness to invest in the scheme citing the ease that comes with it. However, everyone is seriously advised to beware of the scheme

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