Government Intervention
Since it’s became popular earlier this year, government has tried to dissuade Nigerians from participating in the scheme. They have issued numerous warning telling Nigerians that the scheme is a scam that will crash in future.
Director of Corporate Communications, CBN, Mr. Isaac Okoroafor, says MMM is a Ponzi scheme. “At times like this when the economy has suffered some decline, Nigerians should be very careful with those they deal with. Any institution that is not licensed by the CBN to accept deposits should not be given money to keep under any guise. We can vouch for the banking system. The deposit money banks are the only licensed institutions to take deposits. If you need to deposit money in any form, go to any of the deposit money banks and put your money, you can buy fixed income instruments or invest in stocks,” he said.
Okoroafor said the CBN could not guarantee the unregistered institutions, insisting that when depositors lose money to them, the bank would not be able to help them.
According to the Security Exchange Commision (SEC), the venture had no tangible business model, describing MMM as a Ponzi scheme, where returns would be paid from other peoples’ invested funds.
“Ponzi scheme is a fraudulent investing scam promising high rates of return with little risk to investors. The scheme generates returns for older investors by acquiring new investors and will later crash,” the Commission’s site reads.
So the question is, why is the government not doing anything about it if it is considered dangerous?
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