On August 30th, the Securities and Exchange Commission issued this statement about a fake online investment scheme called MMM. The statement said:

The attention of the Securities and Exchange Commission, Nigeria (“SEC”) has been drawn to the activities of an online investment scheme tagged ‘MMM Federal Republic of Nigeria (nigeria.mmm.net). The platform has embarked on an aggressive online media campaign to lure the investing public to participate in what it called “mutual aid financial network” with a monthly investment return of 30%

The Commission hereby notifies the investing public that the operation of this investment scheme has no tangible business model hence it’s a PONZI SCHEME where returns are paid from other people’s invested sum. Also, its operation is not registered by the Commission.

The general public is hereby advised to distance themselves from this online scheme. Please note that anyone that subscribe to this illegal activity does so at his/her own risk.

The MMM investment scheme has a long and fraudulent history. Its name is derived from the last names of its founders: brothers Sergey and Vyacheslav Mavrodi, and Olga Melnikova, all of Russian descent. Those who participate in MMM call themselves ‘Mavrodians’.

Sergey Mavrodi is the Russian equivalent of Bernie Madoff, and nothing regarding his criminal past is hidden.

MMM began as an office equipment company in Moscow in 1989, before moving into the financial sector, promising investors returns of up to 1,000%. That scheme collapsed, and many investors lost their money.

Sergey Mavrodi declared MMM bankrupt and also set up another Ponzi scheme, Stock Generation Limited, with his sister-in-law in 1997. It was a virtual stock market in which you buy shares, much like the original MMM. This article by WIRED magazine details SG’s collapse.

He sought immunity from prosecution as a member of the Russian legislature, but was eventually caught in 2003 and imprisoned for 4 years.

The current incarnation of MMM began in 2011, and combines the community approach of peer to peer lending with the referral bonus system of multi-level marketing, while promising returns identical to a Ponzi scheme.

This version has already swept through countries like South Africa and Zimbabwe, and made landfall in Nigeria, but not before fleecing Russians a second time in 2012, less than a generation after the original pyramid went bust.

As recently as April this year, MMM Global, another Mavrodi pyramid scheme which promised a return of 100% a month, went bust as well.

Despite its fraudulent history and operation, the reason for the consistent appeal of MMM is clear. Sergey Mavrodi casts himself as a Robin Hood type who has come to save the people from financial slavery, by destroying the unfair financial system made up banks and corporations that keep people in invisible chains. He asks everyone to join him in ‘changing the world’.

With many people going through different levels of financial stress, especially in a recession economy, this message has even more resonance. People feel that the system is inherently rigged against them. They have lost jobs and earning power, while at the same time reading about forex millionaires and lavish government spending.

MMM in Nigeria appears to pay, at least for now, because a pyramid scheme functions for as long as the people who make up the pyramid put in much more than those who want to take out of it. When that stops happening, it collapses.

M.M.M is very legit..
Join it..
It passes all tests

Cc: @cchukudebelu @TunjiAndrews

— Graham (@graham_TeleNoza) September 11, 2016

Some people know these risks, but do not mind taking them, thinking that they will can avoid the crash of the pyramid. Many of them will be wrong.