SEC - S17W3 - "Let's talk about ponzi Scheme.

INTRODUCTION:

We know Ponzi Scheme as Rob Peter to pay Paul. Ponzi Schemes is a fraudulent investment scheme in which early investors are paid with the money collected from new investors. The Organizers often promised higher returns on investment (ROI) with little or no risks. The fraudulants are good with words, they know how to convince people especially the unemployed to invest in a fake company or enterprise. Sometimes, they create an enticing story with a forged documents or paperwork to make it seem like the company is actually a legitimate one to invest in.

Question 1: Have you ever heard about ponzi schemes?

Yes, I have heard about Ponzi schemes in my country Nigeria.

Question 2: Have you been offered to invest on any of these schemes?

Yes, I have been offered to invest in more than 3 different ponzi schemes. At first, I was so naive that I didn't know they were Ponzi schemes. In the year 2015, I had a bitter experience with one ponzi schemes known as Mavrodi Mondial Moneybox ( MMM) which is a popular ponzi scheme in Nigeria as at then. They launched their highest website in Nigeria. They targeted a good number of unemployed people most especially the youths, the house wives, market women who are into cooperative societies, and others. They "initiated "people with an enticing and mouth watering offer of 30% returns (ROI) on investment including other bonuses.

This Ponzi Schemes officials carts away with lots of millions of Naira from Nigerian citizens. In fact, the Nigerian Deposit Insurance Cooperation (NDIC) said that an estimated three million Nigerians lost #18 billion in the MMM Ponzi Scheme.

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According to the report, the number of people that signed up by the late 2016 was 2.4 million Nigerians; whose hopes was that MMM will give them easy money. After a year of launching their biggest website in Nigeria, MMM announced the freezing of all members accounts. Reason was systems overload. People started to panic after their accounts were freezed, and the worst happened. A group number of people mostly the unemployed, who considered MMM as their only source of income committed suicide. The house wives who used their children's school fees and house rent to invest on MMM with the hope of getting a huge amount of returns also committed suicide. Many homes were broken because of this. Some workers who borrowed money from individuals, banks and cooperative organizations attempted suicide by jumping in the lagoon and rivers.

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Some were rescued while others didn't survive.

As one of the victims of MMM, I lost more than #1 Million Naira.

Question 4: Do you know how to detect ponzi schemes?

Yes, from my previous experiences with Ponzi Scheme, I know how to detect ponzi schemes now, and these are some ways one can detect a ponzi scheme.

1. Any promises on higher returns on investment ( ROI) with little or no risk.

2. Any company that is unregistered and unlicensed with the Securities and Exchange Commission (SEC).

3. Any company that are secretive to share the full details on how their investments operate.

4. When the investment company offers an overly consistent returns on investment even when all investments experiences fluctuations all the time but they kept generating high returns consistently regardless of the fluctuating market conditions is a ponzi scheme.

Question 5: Do you think Steemit is a ponzi scheme?

No, I don't think steemit is a ponzi scheme because as a new user on steemit, I haven't been asked to make an initial investment before I become a steemit user.And you are only awarded when you create a unique content.

CONCLUSION :

A ponzi scheme is an illegal investment. I advise that before investing in any investment scheme, one should ask for the company’s financial records to verify whether they are legit and also as an investor, you should always be skeptical of investments that sound too good to be true. Try to investigate by contacting the securities and exchange commission (SEC) of your country asking if they know about that investment company.

I hereby invite my good friends @alexanderpeace, @sbamsoneu and @mandate to join the contest. I will like to read their experiences and opinions on this.