Experts Warn Against Emerging Ponzi Schemes

Nigerians, especially the youth, have been cautioned against patronising emerging Ponzi schemes. According to experts who spoke with THE WHISTLER in Enugu on Monday, Ponzi has no security, thus people should desist from investing in it.

Dr Ezekiel Ezike, an economist, said investing in ponzi schemes is not advisable because they are not backed by any law, and also have no insurance of refund when the networks crash. He said while many investors might get rewards, “many will surely be caught in the web of the networks with their devastating consequences”.

Quoting him, “I have heard about many of them currently trending. I won’t mention names, but it is risky. The common slogan of robbing Peter to pay Paul is associated with ponzi. It is what people contributed that is giving out as rewards to corresponding investors, while the hosts enjoy some percentages. It is always attractive at the start, but when the organisers have trapped enough cash in the web, they close up. We do forget easily. At least, the memories of MMM and Crowd Nine are still fresh. Many Nigerians were roped in, and when the die was cast, some of them committed suicide. Some drove their SUVs to river banks, parked and then voluntarily drowned. That tells you the level of the attendant frustration.”

A retired lecturer at Nnamdi Azikiwe University, Awka, Dr Oliver Mpu, called on relevant agencies to sensitise Nigerians on the dangers of investing in vulnerable platforms. “Although citizens have the rights to initiate their means of survival, it is the duty of the government and relevant agencies to educate the masses on the best methods to adopt. These schemes are online, hence it is difficult to control them. But the government can deploy the media to launch campaign against unhealthy investments. Such will let those who want to embark on such ventures to know the inherent dangers. It is for them to decide.”

Some youths doing the schemes, however, said they were aware of the risk. “The bad economy in this country has made everything possible,” a resident of Trans-Ekulu, Enugu, said on condition of anonymity. “Many youths survive through betting and ponzi. I have already cashed out the money from one of the platforms I invested in last week. I know it will crash, but not too soon. The victims are usually those that come last. The beginners will enjoy the investment. I don’t regret it, but I know the dangers therein.”

Johnson resides at Obiagu in Enugu. He said, “I am a graduate, and have no job. My barber’s shop was demolished. I have been thinking the way out. I put in N20,000 and I got my money in double, and it is counting. I use the cash-out to feed. When it crashes, I will not cry too much because I have gained from it. Tell the government to provide us jobs so that we will not be risking all chances. I lost some money to MMM, but I know people that made millions from it.”

Romanus, a resident of New Haven, said the hardship in the country had made gambling inevitable. “I registered and made some returns,” according to him, “I then registered my wife, and she has also made some incomes from it. I don’t know what you are saying. Whoever is trapped should not complain. Those who earned well should celebrate. I have made three times more than my monthly income within a week through this gamble.”