Friday, 16 September 2016

MMM Zimbabwe Froze Withdrawals, Old Members Lost 80% Of Funds

MMM Zimbabwe Froze Withdrawals, Old Members Lost 80% Of Funds

Less than three weeks after Zimbabwe’s National Reserve bank warned citizens to stay away from MMM, the scheme might be showing signs of imminent collapse. MMM Zimbabwe had in some few weeks ago stopped all withdrawals and allowed deposits.

As reported by BehindMLM. In an effort to stave off an inevitable collapse, MMM Global’s Zimbabwe chapter froze investor withdrawals. Deposits were still permitted, with the intention being to collect money without withdrawals draining the system and unfreeze existing accounts on September 15th.

That plan has now been cancelled, with MMM Global Zimbabwe prematurely unfreezing investor withdrawals.

But unknowing to MMM members, the scheme is ripping them off. Here is the catch as reported by BehindMLM:

While affiliates deposit real funds into MMM Global, the company itself pays out Ponzi points called “Mavros”. Mavros must be exchanged for real money, subject to availability of new investment deposits being made.

MMM Eastern Africa, who run the MMM Global Zimbabwean chapter, have reduced the Mavro exchange rate from 1 Mavro to $1 to 5 Mavros to $1.

This is effectively an 80% reduction in the dollar value of existing invested funds and the Ponzi ROI attached to them.

For example, whereas previously an MMM Eastern Africa affiliate who invested $1 was promised $2 within 30 days, now they’ll receive just 20 cents.

Affiliates who had been hoarding Mavros in their back office will now only be able to claim 20% of what they were previously able to request in withdrawals.

This change has likely been implemented due to a lack of new withdrawals, leaving MMM Eastern Africa unable to meet it’s 100% ROI obligations come September 15th.

By reducing withdrawal rates by 80%, it now takes longer for an affiliate to “break even”. But after five months the problem of paying affiliates more than has been invested, known as a “Ponzi liability”, persists.

This will inevitably still bring about a collapse. MMM Eastern Africa have just put it off a bit.

Some existing members are crying foul calling this drastic measure unethical as new members are being offered free money while they are stuck in the system due to their accounts losing 80% of its value.

That’s of course assuming affiliates don’t riot, stop promoting the scheme altogether and demand their money back.

MMM members in Zimbabwe have already started counting their losses. Mr Tinashe Muza of Harare told that “All along things were moving in the right direction and we now have nowhere to claim our investments.”

“When we started putting our funds in the scheme one could get assistance within seven days but things later changed to 14 days and when we were shut out the waiting period was 21 days. What it simply means is that the number of people in need of help has outnumbered the number of people joining. Right now we have nowhere to get our money which we invested.”

Another victim, Mrs Rosemary Mawonde said: “We never thought the scheme would end this way as we believed that by using EcoCash to do the transactions, things were in order. I am surprised that EcoCash is also distancing itself from the scheme and it is clear that I will never recover the USD300 that I invested.”

EcoCash, the mobile money operator that allowed its service to be used by MMM members for their transactions has distanced itself from the matter saying:

“We advise our valued customers and all stakeholders that Ecocash is a licensed mobile payment platform that enables customers to make financial transactions such as sending money, buying prepaid airtime as well as paying for goods and services within the confines of the law of Zimbabwe. EcoCash promotes safe and legal transactions but will not be held liable for any losses arising from the use of EcoCash to engage in illegal activities such as Ponzi schemes.”

Last week, Nigeria’s Securities and Exchange Commission SEC had warned all Nigerians to stay away from MMM. According to estimates, there over 509,021 Nigerians who are members of the Ponzi Scheme as at the time of writing this report.

No one knows when the scheme will start collapsing just like MMM Zimbabwe. However, in May, MMM South Africa had collapse with countless citizens losing millions in invested funds.

Credit:  Pageone

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