Fresh insights emerged yesterday on why the Federal Government cannot stop the promoters of the Mavrodi Mundial Moneybox (MMM), which suspended the accounts of about 3.3 million Nigerian participants recently.
Investigations by Saturday Telegraph revealed that despite many warnings by government agencies, including the Central Bank of Nigeria (CBN), Security and Exchange Commission (SEC) among others, the Federal Government, instead of using moral suasion to dissuade people from doing it, ought to have used the Chinese model through the Facebook to shut down their site in Nigeria!
It was also gathered that since “there was no centralised account,” the “Nigerian Law is against “wonder banks” and Ponzi schemes, it will be difficult to track the money and know the entire amount involved.
“They can only be traced if there is a centralized account where people make lodgements into.” Investigation also revealed that: “Nigeria’s porous laws were fully exploited by the scheme, hence it contravened the CBN act which regulates:
“Deposit Money Banks,” that is, all registered banks that are accepting ‘deposits’ from the general public, but not transactions between individuals.”
A financial expert, who confided in this newspaper, stated that the anti-money laundry laws also stipulated some thresholds, which MMM ensured that “investment’’ did not exceed N2 million (below the AML reporting threshold) and this would also be split into fragments such that a transaction of N2 million can be paired with 10 people.” The source noted that:
“MMM operates as an online based social network, where people pay money to those ‘’paired’’ with them. It is called HELP. Lodgements made into people’s bank accounts cannot be recalled by the depositors, except with a court order.
Since people are paired with strangers and they willingly pay into the accounts they were given, it would not be possible for them to recall their funds.
“The mathematical algorithm behind the MMM is so complex that it is expected to endure for a very long time, as long as people continue to pledge help. The reward system is hinged on greed, 30 per cent flat in 30 days.
“A lot of bankers did it.It is also possible that they could have advised “customers” to do it because of the interest reward. Introducers too also get 10 per cent of the invested funds. “Many Muslim northerners that have apathy towards interest did not do it.
Igbos and Yorubas are fully enmeshed in it.” Similarly, the Nigeria Deposit Insurance Corporation (NDIC) has said the virtual and anonymous operating style of MMM makes tracking the accounts involved very tasking.
The Managing Director/ Chief Executive Officer , NDIC, Alhaji Umaru Ibrahim, stated this yesterday at the ongoing workshop organised by the Nigeria Deposit Insurance Corporation (INDIC) for Business Editors and Finance Correspondents in Kaduna State. According to him, MMM has no office, no fixed address and do not operate an account.
He explained that the accounts created by MMM are “dummy” accounts that are difficult to track. As the NDIC boss put it: “It is MMM today, it could be YYY tomorrow.”
Noting that the CBN and the NDIC was disturbed that about 3million Nigeri-ans had joined the scheme as at October 2016, Alhaji Ibrahim emphasised that all hands should be on deck to prevent people from patronising the scheme, which according to him resulted in participants losing between in $50million and $1.5billion in Russia, the country where it originated from.
According to him, other emerging ponzi schemes include, Givers’ Forum, Ultimate Cycler, Geo Helpworldwide, I-Charity and Zar Fund. Meanwhile, more reports are emerging of the panic that has gripped many Nigerians following the announcement by the operators of MMM that the scheme has been suspended until January next year.
A member of the NYSC serving with a national daily, was recently caught in the organisation’s restroom weeping his eyes out.
When concerned staff inquired what was amiss, he said that he invested the money his parents sent to him for his sister’s wedding coming up in a few weeks in MMM.
He said he had hoped that he would have reaped a 30 per cent interest on the money without his sister’s knowledge, but with the suspension of the scheme, the money was trapped and he did not know what to tell his parents.