MENU
 
 Registered users can save articles to their personal articles list. Login here or sign up here

MMM: SA investors complain of frozen accounts as global arm shuts down

Founder Sergey Mavrodi is nowhere to be found.

MMM Global has closed down the “Republic of Bitcoin” (RB), following the revelation that it was not able to pay monthly returns of 100%, while South African members of the self-proclaimed “social financial network” are complaining that their Mavro (the internal currency of the system, not to be confused with mojo) has been frozen.

Meanwhile, the founder of MMM, Sergey Mavrodi, a convicted Russian criminal who served jail time for fraud, allegedly executed his exit strategy a few weeks ago.

Over the weekend, MMM Global announced on its Facebook page that the RB “was an experiment, and, unfortunately, it failed”.

In South Africa, MMM advertises potential growth of 30% per month on deposits, which is in contravention of the Consumer Protection Act (CPA). In terms of the Act, a “multiplication scheme” – more commonly known as a ponzi or pyramid scheme – exists when an effective annual interest rate 20% above the repo rate is promised to investors.

Offering a potential annual interest of 360%, MMM is clearly in contravention of the maximum 27% that can be offered in terms of the CPA.

Following an investigation by the National Consumer Commission (NCC) – the guardian of the CPA – in 2015, the Hawks have since opened an enquiry. “Our challenge is jurisdiction since everything is done through the internet,” Hawks spokesperson, Hangwani Mulaudzi told Moneyweb.

“Another challenge is there are no cases opened by investors, which is a setback to the ongoing enquiry. We call upon them [investors] to come forward; we are here to help,” Mulaudzi said via emailed responses.

The specialised commercial crimes unit has enlisted the help of Crime Intelligence, the SA Banking Risk Information Centre (Sabric) and the Financial Intelligence Centre (FIC), he noted.

What now for investors?

According to MMM Global, all the “RB-Mavro” will be transferred to the MMM structure in participants’ respective countries. “If there is no MMM-structure working in this country, it will be created within two weeks from the date of this announcement,” the statement explained.

It is not clear how such a structure will be established, particularly since MMM has been at pains to insist that it operates without intermediaries and enables participants to transfer money directly to each other. Even if such a structure is created, participants will no longer be able to use the now “old” RB-Mavro in their “personal office”, effectively their MMM bank account.

Old Mavro will be paid back as the MMM networks develop further in each country, according to the statement, a practice that has been previously tested and usually takes about six months. “This news is not very pleasant but there is nothing that can be done about it. It’s not the end of the world. We just have to wait a bit. We hope for understanding, Administration,” the statement reads.

Some local members, meanwhile, complain that their Mavro has been frozen and support staff is doing little to assist them. One individual claims that accounts to which his ‘team members’ were directed to pay money didn’t exist.

According to the local administrators, however, South Africans who participated in RB will be moved to MMM South Africa and carry on as usual. “In MMM people donate (not invest) money to each other without any promises or guarantees. MMM does not offer any return or an interest rate,” the MMM South Africa Facebook page administrators told this journalist via Facebook Messenger.

“Usually Mavro grows 30% a month. Mavro is not an asset or currency, Mavro is a motivation instrument. With Mavro, MMM motivates its members to help each other by providing financial assistance. Because Mavro is not a financial instrument, its growth rate can be easily adjusted to balance PH (providing help, inflow) and GH (getting help, outflow). The flow of provided assistance and assistance received will always be kept in balance,” they insisted.

Where is Mavrodi?

Mavrodi has made no comment on the latest developments in his MMM scheme, prompting a website that investigates multi-level marketing schemes to suggest that he has fled.

Traditionally communicating with local investors via weekly YouTube videos, Mavrodi announced on March 20 that because the MMM system was developing so well, “from now on I won’t be recording video messages weekly”.

“Of course, if there are situations requiring my comments I will make my video messages, otherwise – in order to show up on the screen for two minutes – it seems there’s no point in it.”

Clearly, Mavrodi does not believe that investors require any assurance from him following the shutting down of the Republic of Bitcoin and the ramifications of that for investors (or the alleged frozen Mavro for that matter). As always, he signed off his last YouTube clip with the customary message, “As well, I believe that the financial apocalypse is inevitable. Together we change the world.”

If video testimonials are anything to go by, some MMM members appear to have made oodles of boodle off the scheme, with donations upwards of R40 000 flying between members. Armand from Johannesburg is the latest to post his testimonial on the MMM South Africa Facebook page, saying that he requested “help” of R32 000, which was promptly deposited into his bank account leading to him ‘enjoying life now more than ever’.

While that may be true for a number of MMM members, of grave concern is the countless others who may now lose money in the apparently faltering scheme.

COMMENTS   22

To comment, you must be registered and logged in.

LOGIN HERE

Don't have an account?
Sign up for FREE

The mystical millions

Anybody that invested and believed the ‘’Republic of Bitcoin” and the mystical million profits that they would generate (due to projected paper profits), would be much better serviced by the local reputable market products.

‘’A miracle: an event that described by those to whom it was told by men who did not see it. ‘’ Elbert Hubbard (1856-1915)

At least, unlike the NEWS 24 journalist you took the time to understand a bit of what is happening in the MMM world.
Who complained to HAWKS? We, the members of MMM are happy – we are making money. We are helping each others make money. The only people who are complaining must be the ones we used to owe money, because we are no longer enslaved by them.

No you are not making money. You surely knew that Mavrodi is a convicted Russian fraudster. Leopards do not change their spots. These scams work for a while, until the money going out is more than the money coming in, and that means the scheme collapses dramatically. The people at the top of the pyramid will be the only winners and they will get away with it, as the law is too slow to act. Mavrodi seems to have disappeared – which was to be expected. No-one, no-one, no-one can offer you 100%, 30%, not even 3% per month. Your “mavros” are worthless. People don’t report to the police as they keep thinking it will all turn out OK. And then there’s the embarrassment factor.

All the information about him is available to our disposals. We are not part of an investment scheme, we are part of a donation scheme… we donate to each other. We are a large network.
It is working for us and we are happy… everyone that has received help has come back to help others.
We are not investors we just ‘help mekaar’ that’s all. We are aware of the risks involved – the most important one being you might help someone and not get help. The system has checks and balances to ensure that everyone who needs help receives help, but just like my provident fund at any institution – there are no guarantees.

Go read a book buddy. You have been brain washed. How much do you think banks make from you 32 day notice?

@Teezozo
If people are going to receive 30% per month then someone must pay that 30% per month, (only the government can create money from nothing and Zimbabwe proved that even that capabilities has its limits).

Would anyone borrow and repay money at 30% a month when a bank would provide it at 10-18% per year? Only the desperate and too high risk to borrow from the banks.

So if you don’t have other paying 30% in month in interest then your so called return must come from somewhere. In ponzi schemes the “returns” are paid from capital (Money invest) (so taking from one to give to another). This is only sustainable as long as new member are recruited into the scheme but it always falls apart in the end as infinite growth at these rates are not possible when the global economy grows less than that and the only ones who ended up gaining is the Ponzi scheme master and those first ones who’s gains are actually just money that those behind them lost.

Ponzi schemes are very similar to cults in that any who are against seen as only wanting to push you down/prevent you from succeeding. As such it is very difficult to convince someone of how they are being duped.

I can only hope for your sake and other “investors” that you have not invested your life savings into this, so that when it collapse (inevitably) that the loss doesn’t break you financially.

Lastly for you to receive any return, someone must pay for it, find out who is paying or it might just turn out to be you.

You my friend will be very disappointed in a few days / weeks from now. Best you cash in now if you can and RUN!!! SARS are tracking you for tax evasion.

You are correct, and I agree with you – why should the regulating authority or the police interfere in a scheme where all the members are happily making money? Even if everybody loses money, their freedom of choice should be respected, as long as they take full responsibility for their actions.

Now this is where the problem lies – those who lose money (everybody involved in the scheme) eventually blames the Banking Regulator, FSB, police and the press for not investigating and warning them in advance. It is the sad truth that no institution can protect an individual from his own stupidity.

Eish &HAHA. A fool and his money is soon parted.
Good luck. Maybe talk to the defenders of Cambist for some encouragement.

The question you have to ask yourself – if A and B and C and D and E each put R10000 into a “stokvel”, and A’s money grow by 30%, giving him the entitlement to withdraw R13000 – then someone has only R7000 to withdraw – either B,C,D or E. If you believe you are part of A, you have either willingly or unintentionally taken money from the rest of the crew on board. You can reason, yes, however they can bring more on board – F and G and H and I, let us escape the worldly banks that do us in on a daily basis – fact of the matter is – you are not solving the problem, you are adding to it…

Anyone with a common sense understands for one to make money, value needs to be added (as product or a service). If you truly believe that every single person in this scheme can make money, rather take your money and plant it in your garden – the odds might be higher in getting a return…

BOo Hoo, my heart bleeds. Why would anyone in their right minds believe in a return like that!

If you want to donate money and help each other, maybe you could also donate some of that in cash to the Salvation Army as well!

Money is only a tool. It will take you wherever you wish, but it will not replace you as the driver. Ayn Rand

All the world’s a stage,
And all the men and women merely players. I made money with MMM and if I loose some, I don’t care. We are all someone else’s fool. Read about the Illuminati. You are all slaves.

The author is just a bitter investor. And so are all negative commentors. Se se salang. People did make money and they will continue to make money. This is just a rumour and not even the first one. Read again on Fin24 they change the story again.

Hi Loxion, thanks for your comments. I can assure you that I haven’t invested in MMM. I am simply reporting on the happenings of the network as they unfold.

Hey Stupid.. . Yeah you (the ones who think news events matter and Nkandla is just a topic)

What if I told you that banks are making waaaay more profit a year using foreign exchange than the report rate? Uhm when you invest for a year and get 4 percent, who keeps the 96 percent stupid??? Google something called “qriket”, why isn’t it available in South Africa? People in the US and other developed countries don’t need to join “Ponzis” to make money because there are other means of making money besides a job. Think you dumb bastard, don’t let the media do the thinking for you. The person who wrote this is clearly a member who got burnt and clearly didn’t read the ideology. Read South Africa, instead of wasting time with hashtags and watching TV. You are being played on a major scale.

Teezozo…… OMW….. you must be the most naive person alive….. I truly feel sorry for you

you are absolutely right, people are utterly stupid and ignorant!

Load All 22 Comments
No more Comments, leave a reply.

LATEST CURRENCIES  

ZAR / USD
ZAR / GBP
ZAR / Euro

Podcasts

GO TO SHOP CART

Follow us:

Search Articles:Advanced Search
Click a Company:
server: 172.17.0.2