vendors, have lost thousands of dollars to fraudulent
online pyramid scheme MMM Global Zimbabwe after it
collapsed recently.
The social financial network, which relied on an
accelerating number of new members to pay off the old,
abruptly terminated
its services last week leaving
participants stranded.
This comes as Econet’s mobile financial service
platform, EcoCash yesterday distanced itself from the
pyramid scheme. Participants claimed they were using
EcoCash for their transactions.
Zimbabweans have in the past months been joining the
online investment scheme in droves in a bid “to get rich
quickly”. The Reserve Bank of Zimbabwe warned
people that the scheme was fraudulent and there was
no legal recourse in the event they lost their money.
The central bank said MMM, which advertises its
operations through a website and recruiting agents,
was not a registered or regulated entity. EcoCash
yesterday said: “We have noted that some of these
pyramid schemes are allegedly advertising in a manner
that suggests that the Ecocash facility is a medium for
prospective members to deposit their money. This is
not correct.
“We advise our valued customers and all stakeholders
that Ecocash is a licensed mobile payment platform
that enables customers to make financial transactions
such as sending money, buying prepaid airtime as well
as paying for goods and services within the confines of
the law of Zimbabwe. EcoCash promotes safe and legal
transactions but will not be held liable for any losses
arising from the use of EcoCash to engage in illegal
activities such as Ponzi schemes.”
The scheme advertises itself as a mutual aid fund
under which recruited members contribute money to
assist others and are promised investment returns of
30 percent per month. Some of the people left counting
their losses told The Herald that they received emails
that the scheme had been suspended until September
15.
“All along things were moving in the right direction and
we now have nowhere to claim our investments,” said
Mr Tinashe Muza of Harare.
“When we started putting our funds in the scheme one
could get assistance within seven days but things later
changed to 14 days and when we were shut out the
waiting period was 21 days. What it simply means is
that the number of people in need of help has
outnumbered the number of people joining. Right now
we have nowhere to get our money which we invested.”
MMM stands for Mavrodi Mondial Moneybox and takes
its name from its founder, Sergei Panteleevich Mavrodi
of Russia. He founded MMM in 1989 and the scheme
was declared bankrupt three years later leading to the
disappearance of Mavrodi until his arrest in 2003.
Another victim, Mrs Rosemary Mawonde said: “We
never thought the scheme would end this way as we
believed that by using EcoCash to do the transactions,
things were in order. I am surprised that EcoCash is
also distancing itself from the scheme and it is clear
that I will never recover the $300 that I invested.”
While some people who were skeptical about the
scheme started with small amounts, it is believed some
poured in thousands of dollars anticipating higher
returns. The RBZ said the schemes were fraudulent as
existing investors were ‘paid money not from genuine
market investment of their funds, but from
contributions made by new investors, until a point
when the scheme can no longer attract new investors,”
“The participants are made aware that they make their
money by recruiting new members who in turn must
recruit more members,” warned the Central Bank.
RadioNigeria
Finiancialwatch
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