ACADA

Saturday, 17 December 2016

How Ponsit, MMM and likes work


Having lost 2,300,000NGN (two million, three hundred thousand naira) to WealthSolution, Real & Cool, PennyWise and the likes in June 2007, not subscribing to MMM was no brainer as it is only a matter of time before the schemers would pull the plug. As much I do not want to subscribe to the school of thought that it has crashed already, it may surely not survive the next 60days as anyone who survives this end of the year shocker (account freeze) would need no prophet to advise him/her to stay clear should he be able to finally receive help come January. In January, the 30days gap would make almost everyone whose account was placed on hold/freeze qualify to get help but who would be ready and willing to GIVE HELP, Me?

Four (4) weeks ago, it became evident that the scheme was heading down south when one subscriber who needed to cash out 470,000NGN was assigned 21 other subscribers to give him help (send him money). This shows that there is increase in the number of people offering to give help of less than 30,000NGN compared to a few months ago when people were placing in as much as 1,000,000NGN. Please note that I do not refer to them as investors as they are not investors rather gamblers.


After interviewing some guiders, captains, subscribers and reading some online articles, I got a better understanding of how the scheme actually works (the matching algorithm and cash out model). A subscriber who is due to cash out (receive help) is assigned one or more other subscriber(s) who is/are due to give help. When the time is right for the schemers to pull the plug, crash the scheme in Nigeria and finally cashout, the same model would be adopted to avoid suspicion however only with some selected number of more greedy and trusted guilders and captains who would be paid a percentage of the amount they are able to pull perhaps the same 30%. I will explain further in the next paragraph.

It is assumed that MMM Nigeria has over 3,000,000 (three million) Nigeria dwellers (citizens and non-citizens) who already enrolled on the MMM platform, I would refer to them as active accounts. All the schemers need to do is to create a syndicate of greedy, trusted and highly secretive captains and guilders of at-least 1,000 out of the 3,000,000 active accounts, whose account would be assigned to other unsuspecting subscribers to give help to. Just like the existing model, no one would notice any foul play as nothing has changed; the process has not been modified in any way only that only a selected number of people (syndicate) are receiving help from others.

Let’s assume that MMM Nigeria is pulling out 250,000,000,000NGN (two hundred and fifty billion naira), each of the 1000 would get 250,000,000NGN, imagine being promised to get 30% of any amount you pull, that is 75,000,000NGN, trust me, an average guilder and captain would sell his/her birthright to get that amount and care-less about the crashing MMM Nigeria or otherwise . The sudden account inflow should raise a flag within the banks’ core system as some of the guys’ account may never have recorded such inflow before. FLAG Number 1. – BANKS to be on ALERT, Anti-money laundering monitor should flag the accounts

Getting the funds out of the country to the chief schemer Mavrodi or his accomplice would be the next stage of execution but this would be a tall order due to the stringent FX policies surrounding inflow and outflow of funds in and out of Nigeria. Money laundering is an option but highly risky and could easily give them away. Another option would be to further integrate the money into the system by transferring between accounts before finally pulling it out of the country.

Illustration A gets 50m deducts his/her 30%, moves the balance of 175,000,000NGN to B, B moves 170m to C, C move 165m to D until 150m gets to F. This would make tracking the funds difficult and easier to escape any money laundering trap within the banking systems. Another reasonable option would be to use FORM M and FORM A. The schemers engage registered foreign corporate entities in different countries to issue supposedly genuine and valid documents (Bill of Entry, Commercial Invoice, Bill of Lading / Airway bill etc.) to enable them access foreign currencies through FORM M and FORM A in disguise for payment for imported goods. The banks could be of immense assistance here as the FORMs would be accessed through the banks. FLAG Number 2. – BANKS to be on ALERT in issuance of FORM M and A

Another option is smuggling the funds through the borders to another country(ies) from where the funds would be transferred to different accounts in different countries to outsmart any forensic investigations – FLAG Number 3 – CUSTOMS to the rescue

Yes, people were warmed but it is not always easy to say NO to this kind of schemes, I also learnt the hard way.
All the best to MMM Nigeria Subscribers, this is the only way I could help with tracking of your funds and possible retriever.

© Ayobami Akinade AAT, ACA, ACCA(affiliate)

Business Strategist and Financial Analyst.

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