It is funny how Kenyan tend to forget so fast! Their appetite to join pyramid schemes that propose to increase their income with positive integers is insatiable. There have been numerous Ponzi schemes that have been introduced before by fellow Kenyans taking Deci, introduced by Mary Odinga, as a good example. All these pyramid schemes have evaporated to thin air without any traces of pursuit. The new scheme that is syphoning off Kenyans money is MMM Kenya. Their narrative is so sweet not to be lured into it. But before getting into the narrative, Let us know the fine details about this scheme!
The founder of MMM (Mavrodi Mundial Moneybox) franchise is Sergey Mavrodi, a Russian con-artist, fraudster, and swindler. The scheme is speculated to have started in Russia before its collapse in 1997 with a fine share of investor’s money of not less than $4 Million. Mavrodi (the founder) had been accused of swindling Russian investors off their money and sentenced to a four and a half years imprisonment. In 2011 after his release, he re-ran the MMM Ponzi in Africa.
Some African countries such as South Africa, Zimbabwe, and Nigeria, had the Scheme launched, defrauded their citizens, and bubbled out. Fresh targets became Kenya, Ghana and other countries where the light of cryptocurrency seems to shine brightly. Gullible Kenyans are enticed into joining the Ponzi network of financial helpers, where you invest some of your money, advance help to a financially needy peer, and you earn points which would be converted into digital currency for possible withdrawal.
Return on Investments
To make the narrative sweeter, it was stated that there was no central account into which funds were being held, awaiting release to needy members, and returns to financial helpers. It was a system where each participant held their money in their accounts, waiting for an instantaneous transfer to a needy peer. Meaning that MMM Kenya was acting as a regulator of the entire process.
But here was the deal,
You were supposed to make an initial subscription of $10, which equates to about Ksh. 1000. In addition, you were expected to possibly encourage more investor joining to earn bonuses plus a 30 percent increase in your investment. Let’s do the Math here if you invested ksh. 1000, after one week, you would have Ksh. 1300 in your account which you could advance to another needy participant. For the second week, you could have close to about Ksh. 1690 and the cycle continues. We just did a rough cast with Ksh. 1000, what if you invested Ksh. 100,000? You could pocket more than Ksh. 70,000 in two weeks!
So when the news, spread about this money making project, Kenyans plunged in with an aim to get rich overnight. With the assurance from the Ponzi boss that MMM was in no way a bank, a pyramid scheme, or anything else related to that but a community of people willing to offer financial help to others. But like any other MMM in Africa, when the number of those seeking help surpassed, those joining as new members, then the scheme would collapse. In fact, that is what happened in Nigeria.
A similar case with a different twist happened in Zimbabwe where the value of investor’s money was reduced by 80 percent! With over 60,000 victims, their investments were slashed close to Zero. If someone invested Ksh. 10,000 initially, their investment was reduced to Ksh. 2,000! Which further, could not be withdrawn as a whole but only 1%, which equates to Ksh. 20 if my Math is right! If you withdraw your Ksh. 20, your wallet account remains Zero, even though you had an investment of Ksh. 10,000, which you advanced to “someone” online!
With the death of Mavrodi the founder, it is just a moment flip of a coin, before all Kenya’s investors into the MMM Kenya scheme realize it was only a SCAM!