Ba­sotho rally be­hind Ponzi scheme

Lesotho Times - - News - ’Marafaele Mohloboli

Ba­sotho have vowed to con­tinue “in­vest­ing” in MMM Global — a pyra­mid scheme which has taken Le­sotho by storm but has since been con­demned by the Cen­tral Bank of Le­sotho (CBL) and Con­sumer Pro­tec­tion as­so­ci­a­tion (CPA).

MMM Global prom­ises its mem­bers un­re­al­is­tic re­turns of up­wards of 30 per­cent and bears an un­canny re­sem­blance to MKM, which promised in­vestors un­sus­tain­able re­turns un­til it went bust in 2007, leav­ing about 400 000 Ba­sotho high and dry.

how­ever, the de­pos­i­tors ar­gue that MMM Global calls them donors and not in­vestors so the CBL can­not reg­u­late the scheme be­cause there are no re­turns or prof­its from do­na­tions.

they also ar­gue the CBL can­not con­trol the scheme and call it il­le­gal es­pe­cially with­out a cen­tral point where trans­ac­tions are con­ducted. MMM op­er­ates on­line, mak­ing it dif­fi­cult to track trans­ac­tions. One reg­is­ters on its web­site and is al­lo­cated a per­sonal of­fice code which they use to log in.

In­vestors are then paired with one an­other and en­abled to trans­fer money to each other. suc­cess­ful trans­ac­tions be­tween the anony­mous in­vestors are fol­lowed by no­ti­fi­ca­tions say­ing the in­vest­ments would grow by 30 per­cent monthly.

MMM Global was founded by sergey Mavrodi — a Rus­sian con­victed and jailed for four-and-a-half years for de­fraud­ing 10 000 in­vestors through a sim­i­lar Ponzi scheme in his home coun­try.

But af­ter the CBL warn­ing, Ba­sotho re­acted an­grily through so­cial me­dia and ral­lied be­hind MMM Global, which now has more than eight face­book pages of over one mil­lion fol­low­ers.

tlady Blankbelly Loliwe sera, was one of the many Ba­sotho, who vowed to sup­port the scheme and wrote on face­book: “What is a bank? A bank is an in­sti­tu­tion that takes all money from so­ci­ety and keeps it be­hind glass doors. When you want your money, you have to go through tough ques­tions. They bor­row you your money so that you go and hunt more that is still left in so­ci­ety and bring it back to them, but MMM is the so­lu­tion. MMM takes money out of the banks and it ro­tates within so­ci­ety. We start to see houses built, we start to see kids go to school, we start see­ing cars, we start to see busi­nesses grow, not just bank build­ings!

an­other face­book user, tsi­etsi Mathang, who also feels strongly about MMM Global, posted: “The MMM saga; Well, it’s a threat! Le­sotho’s eco­nomic his­tory has re­ally never seen ei­ther a boom or a slump. Ba­sotho have al­ways been mod­ern-day slaves since the start of or­ga­nized civil so­ci­ety in the early 1900s.

“We (our lead­ers) have never re­ally been able to draw a line be­tween the as­pect of pol­i­tics and econ­omy. This led to a vi­cious cy­cle of eco­nomic seg­re­ga­tion whereby those elected into power ma­nip­u­late the sys­tem to their ben­e­fit.

“This would mean our econ­omy vir­tu­ally had no pri­vate sec­tor and the rest of the cash­flow be­longed to the ‘pub­lic sec­tor’. MMM comes through, ‘the real pub­lic sec­tor’, and ta­bles turn. Now that we are a threat, this is our chance to hit them and hit hard. With that said, the fact that our econ­omy’s de­vel­op­ment has been ‘pur­posely’ pro­hib­ited from reach­ing a boom, then maybe it’s time we hit a slump. De­stroy what was once built against us and re­build it into a new Le­sotho. Le­sotho is turn­ing 50 this year and it should be a turn­ing point for her. I mean, the mother­land should be over her mid-life cri­sis by now!”

on the other hand, call­ers to dif­fer­ent ra­dio pro­grammes al­leged bank em­ploy­ees were pos­si­ble share­hold­ers in such pyra­mid schemes as they al­ways al­lowed them to take off and later dis­own them af­ter they have had their shares back.

But the CBL is still warn­ing Ba­sotho about such schemes, and noted in a state­ment: “Cur­rently, the pub­lic is specif­i­cally warned against ac­tiv­i­ties of MMM Global, MMM south africa, KIPI, World Ven­tures and other sim­i­lar schemes.”

the bank has also called the schemes “very old forms of fraud”, “and yet mod­ern tech­nol­ogy has sig­nif­i­cantly in­creased their po­ten­tial for harm­ing those who may be lured to in­vest. the in­ter­net, in par­tic­u­lar, of­fers pyra­mid pro­mot­ers a multi-lane high­way to rapidly at­tract cus­tomers from all over the world.

the pub­lic is warned that th­ese schemes re­main il­le­gal in Le­sotho,” adds the CBL state­ment.

MMM Global founder Sergey Mavrodi.

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