Can You Really Get Rich Right Now?: Ponzi Schemes
“Double your investment/capital in 45 minutes”
“Invest 30k and get 90k in 3 hours”
This is what a Ponzi scheme ad looks like. Believe it or not, these are real ads in Nigeria. Any sane person is supposed to be able to see these types of ads and instantly know that the intentions are fraudulent.
Wikipedia defines it as:
“A Ponzi scheme (aka Ponzi game) is a form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors. The scheme leads victims to believe that profits are coming from legitimate business activity (e.g. product sales and/or successful investments), and they remain unaware that other investors are the source of funds. A Ponzi scheme can maintain the illusion of a sustainable business as long as new investors contribute new funds, and as long as most of the investors do not demand full repayment and still believe in the non-existent assets they are purported to own.”
Ponzi schemes are really easy to point out; the return on investment is usually too good to be true because they are usually on the high side. The returns are always guaranteed that is next to no risks involved. They usually have funny names; from 2016 to 2017, I think there were up to fifty different Ponzi schemes in Nigeria at the same time. Not a single one of them lasted more than two months. The longest-lasting was MMM (Mavrodi Mundial Moneybox) which I think was global.
For a country that has a Ponzi scheme outlawed, Nigerians are heavily involved in it.
“Is Ponzi scheme a crime in Nigeria?
Unarguably, Ponzi schemes operate without the license and authorization of the CBN and are thus, illegal. Ponzi schemes have also been recognized by the Nigerian Court as illegitimate and fraudulent thus in the case of Mekwunye v. Lotus Capital Ltd”
Ponzi schemes, especially MMM, ruined so many Nigerians financially but people still sign for new Ponzi schemes to this day. Last year, amidst the global pandemic, some gullible and unsuspecting, or perhaps, careless, greedy and ignorant Nigerians lost their money to some similar schemes.
It’s almost as if people don’t learn. I asked some of my friends that fell victim last year, why they invested in Ponzi schemes again, even with all their knowledge. One said he was hoping to be among the first people on the scheme. Another person said it was a good gamble and they would do it all over again.
Personally, I think one of the ways to curb this Ponzi scheme epidemic is by hosting a nationwide financial literacy campaign for the ignorant ones. A team of financial gurus going from town to town telling people how money works, what is obtainable and what isn’t.
As for the greedy, I don’t think there’s a cure for greed yet.
HOW TO GET RICH QUICKLY?
Simply put, in the words of Naval Ravikant, “There are no get rich quick schemes. That's just someone else getting rich off you”.
Final word: I think someone should run ads with this Naval’s quote. Social media ads, billboard ads, the whole nine yards.
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Nice
Thanks
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https://twitter.com/thegamsam/status/1378277064051195907
There’s always another ponzi man the ones we see on the news are small time even if the money is big! There’s bigger Ponzi S at play in the stock market,spac market, crypto and currency markets! These Ponzi exist in such large amounts because we live a Ponzi like credit system so it’s just mimicking the rules of the wider system
It’s the system eating itself sadly it’s always the small guy that gets hurt!
Very true. The whole institution of the financial system is just one big ponzi.
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The fish rots from the head down
Nice read. It's pretty sad seeing people fall into these kind of obvious scams, especially in the most disadvantaged country economically speaking.
It almost makes me wonder if the Cryptocurrency industry has this kind of 'market' growing off of it like a tumor. We've seen this happen quite a few times especially in the DeFi space in the form of rugpulls. CUB.Finance is obviously a trusted project by a great team behind it, but many other DeFi projects aren't backed by anything. Compound that by the fact most people are enticed by none other than the promise of becoming rich, and BAM! Everything is primed for a rugpull.
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Well, the ponzoid structure can be applied anywhere. Even in crypto.
That is why it is always important to DYOR, but despite that, one can't be too sure.
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Ponzu schemes are very rampant in Nigeria like you said.
I myself have fallen victim more than twice and what totally saved me was the blockchain. Through leofinance I now have a little understanding of how money works for you not the other way round .
Nice write up. Yes you are right Greed has no cure yet.
Sorry about that man. True, greed is on of the major driving force feeding ponzi schemes
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Yes it is
I hope everyone wake up too see it
I hope so too