JOHANNESBURG – You cannot lose what you freely give away. In the case of the self-proclaimed mutual financial aid scheme, MMM, members “donate” money to one another and so presumably must be content to not get anything in return.
If they are not comfortable with that notion, they contradict the very essence of a donation (a gift freely given) and therefore of the scheme itself.
Deon van Rensburg – who on behalf of MMM members is seeking a ruling from the High Court on whether or not MMM is a ponzi or pyramid scheme – explains that there are no returns earned in the MMM system.
Once you have registered with MMM, you need to first donate money to someone else, at a minimum amount of R100, before being rewarded with mavro.
Mavro is an internal currency that is given as a reward to donors. It increases in value and can later be converted into hard currency.
“MMM relies on existing members donating back into the system,” Van Rensburg explains, adding that the scheme depends on both growth in new members and money being put back into the system.
“It requires people to be honest and generous,” he says.
Having said that, once you have made a donation, there is no guarantee that you will receive assistance, Van Rensburg adds.
After registering on the system (which appears to be a computerised platform that functions off an algorithm) and committing a donation, you are provided with a bank account number into which you transfer the donation.
Once the person confirms receipt, your mavro become active and allow you to later request financial assistance by converting some or all of your mavro into hard currency.
Currently, the conversion rate of mavro to hard currency is 100% – i.e. 1 mavro = R1. Mavro increase at a rate of 30% per month, according to MMM’s website.
If the growth rate falls to 0% (because new members stop joining and existing members stop donating) then you will simply get what you put in, according to Van Rensburg.
“However, if the conversion rate decreases you will receive assistance for a lesser amount than what you have provided assistance for,” he notes.
Mavro is there to balance the inflow and outflow of money, and its growth rate can be adjusted to keep this balance in check, according to administrators of MMM South Africa’s Facebook page, who emphasise that “there are no promises or guarantees”.
Asked whether members could be unknowingly funding criminals through this anonymous system of donations exchange, Van Rensburg comments, “If I wanted to launder money I wouldn’t use MMM, because there are no guarantees.”
MMM members should have no problem with giving away their money to help others and receiving nothing in return.
That is, after all, the definition of a donation.
Van Rensburg – who suggests that as much as 75% of people participating in MMM could be classified as middle-class – argues that the scheme represents the purest form of social upliftment there can be.
“I can’t lose money if I give it away. You donate your money. I might get help, I might not,” he says.
Despite being such an ardent supporter of the scheme, Van Rensburg himself is not a participant in MMM.