The global financial pyramid MMM crash in Zimbabwe provided thousands of Zimbabwe citizens to lose their money. This scheme left thousands of investors in their despair situation. MMM, or as it comes, Mavrodi Mondial Moneybox is extremely popular scheme in many African countries. It claims that every participant can get up to thirty percent of their payments monthly. It`s so-called Ponzi scheme has provided a major threat to the people. Many people who invested their money into this scheme – lost their money. The founder of this scheme is Sergei Panteleevich Mavrodi. It`s not the first MMM crash history that you witnessed.
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MMM crash in history
Russia MMM crash news
MMM was established in USSR in 1989. The founders of this financial pyramid were Sergei Mavrodi, Olga Melnikova and Vyacheslav Mavrodi. The name for this company was created out of the first letters for the founders` family names.
From the very beginning of its creation, the MMM company imported office equipment and computers for the Ponzi scheme. The very first attempts of the company to become a successful business were unlucky. The first difficulties provided to the MMM company was connected with tax evasion accusations towards MMM bank that almost led to the bankruptcy. They stopped working as a bank organisation when they obtained no financial help from the side of the Government of Russian Federation. Their foreign trade operations at that time were extremely dangerous and provided no success. Therefore, they had to switch towards financial sector to live through the hardest period. They tried to propose American stocks to Russian investors. Unfortunately, Russian investors preferred to invest money in dividing their country rather than buying American stocks. Nevertheless, Sergei Mavrodi also decided to recreate MMM into the investor company and started to buy vouchers during the privatisation period. Due to the criminal situation in Russian Federation during the 90s, the efforts of many companies connected to the privatisation were unsuccessful.
MMM crash history showed that the first successful Ponzi scheme in a new Russian history was created in 1994. MMM company started to attract money from private investors. Sergey Mavrodi promised thousands of percent annual returns to people if they invest their money into the pyramid. It`s unclear even now whether MMM Ponzi scheme was an initial plan for Sergey Mavrodi or he used it for the foreign import-export operation as the hyperinflation in Russian Federation could promise people the return of their money.
MMM company crash in Russia started with an extremely high fly. In February 1994 they started an aggressive TV and ad company. Their shares and dividends were not quoted by any stock exchange. It means that they have their policy towards dividing everything they desire and they could settle their price. They managed to maintain a steady growth for themselves. Due to their determination of the price, they created an illusion that everything in the scheme is a table and people might get their money back. Nevertheless, the dividends could be only provided with investments from new people.
One of the main success for MMM company was its PR and management campaign. Their advertisement campaign could appeal to general public. People could identify actors with themselves and could provide some new investments to the future MMM crash. The most famous “folk hero” for MMM campaign in Russia was Lyonya Golubkov. Another strategy marketing efforts were directed to the Metro station. MMM provided one day in the year when all citizens of Russia could use Moscow Metro station for free. MMM company was one of the first advertisers who used slogans and logotypes in their ad campaign.
In the peak of MMM company, it could take more than 100 billion rubles per day (it`s around 50 million per day for that time). It also provided shares to the public and even to the people who were not the part of the Mavrodi pyramid. The cash-flow of money could not be estimated. Therefore, they tried to use another scheme for counting the money, like roomfuls – one roomful of money, two roomfuls of money. Moreover, this money couldn`t be calculated at all. Later Mavrodi confessed that all his employees stole cash from these roomfuls, but even in that circumstances, these roomfuls managed to look full.
Regular publication to the mass media about rising MMM share price left the president of Russian Federation – Boris Yeltsin no choice, but to issue a decree where it was prohibited to publicise the expected income of financial companies. The decree was created in June 1994, when almost one-third of overall Russian Federation cash was in the hands of Sergei Mavrodi. Still, it did not stop the initial success of MMM company in Russia. People continued to invest money in the future MMM crash. Mavrodi continued to use aggressive advertisement campaigns to find more people in the pyramid.
The success of MMM provided a rise of many similar companies in Russia. The economic situation was extremely drastic, so people had a desire to leave their money, not in the national banks. The companies that used MMM company strategies were German, Telemarket, Tibet, Khmer-Invest, Selenga and Chara. All these companies tried to apply the same aggressive telemarketing campaign. They promised to provide extreme return rates to the investors – up to 30, 000 percent in the year. Some of them might be call successful, but the true success was given to MMM company.
July 22, 1994, was not the best day for MMM company and Sergey Mavrodi himself. On this day, the offices of the company were closed because of tax evasion. The Invest-Consulting, which was one of the subsidiaries of MMM company, managed to own to the government more than 26 million dollars. Sergei Mavrodi owned investors more than 1.5 billion dollars. According to the Russian media, more than fifty investors committed suicide when they heard the news that MMM pyramid was destroyed in one single blow from the government tax collectors. Moreover, thousands of families lost their money in MMM company pyramid.
Several organisations of deceived investors tried to make some efforts to recover their money from Sergei Mavrodi. Nevertheless, he managed to deceive them one more time and directed all their money to the government campaign. In August 1994, the founder of MMM company was elected to the Russian State Duma. He accused a government that due to the actions of the president and the government MMM company lost its money. Therefore, deceived investors lost their money too because of the government. He even promised to initiate the pay-back campaign, but the sum for the payback was extremely small compare to the money he owed to the people.
October 1995 was also not the best month for MMM company as Mavrodi lost his Deputy immunity. Still, he decided to open all his cards when tried to run for Russia`s presidency in 1996. Nevertheless, most of the signatures for his presidency were rejected. MMM company declared its bankruptcy on September 22, 1997. Therefore, it was the first MMM crash history lesson.
Sergey Mavrodi tried to flee to the United States with the last sum of money he had. Still, MMM crash leader could find its place only in Moscow where he tried to hide in the apartments of his former employees. He was found by Russian police in 2003; then he was in custody up to January 2006. He was convicted of fraud in April 2007. Sergei Mavrodi was given a sentence of the four and half years of custody. Nevertheless, he had already spent more than four years in custody, and the government had no choice than to release him a month later.
The MMM company scandal raised suspicious to the companies connected with joint stocks. Still, Sergei Mavrodi tried to reopen MMM in Russia in 2012 and the other world in 2015.
MMM crash in Zimbabwe
It`s reported that MMM Global Zimbabwe crashed recently. Thousands of Zimbabwe vendors and civil servants, just citizens, lost their money in the Ponzi scheme. The fraudulent online pyramid MMM crashed in Zimbabwe. This pyramid related only to the accelerating numbers of the new members. These new members could pay off the money for the old members. Nevertheless, the system is reportedly terminated its work for the last weeks. There was no prior notice about that. Participants of the MMM crash today can provide no information about the life of their money in MMM company today.
According to the local media, this scheme was only directed to the one cause – to become rich extremely quickly. The reserve bank of Zimbabwe reported to the citizens that it was a Ponzi scheme. Therefore, from the very beginning, the scheme was fraudulent. The scheme provides the same old information, like in Russia twenty years ago. It was promised that people could get their investment returns by 30 percent every month. Some people invested all their money in the scheme. It means that they managed to lose their homes, their cars and all their property in MMM crash.
One of the victims of MMM crash explained that all things were exactly perfect and could go in the right direction. If anything happened to the participants of the pyramid, then they could get assistance in the seven days’ period, but it later changed to the 14 days’ period and then 21 days’ period. The conclusion to this scheme of assisting to the people is extremely simple – in the few days, the number of people who needed help outnumbered the quantity of new members joining MMM company. It means that no one gets the money back and people have nobody to ask for the payback.
MMM E.Africa reports
MMM E.Africa, admin continue to deny reports that MMM crashed in Zimbabwe. It`s also interesting that Nigerians keep their interests about MMM crash news. According to the words of the MMM E.Africa admin to the question: “is MMM crash in Zimbabwe happened” – the answer can be that it has not happened and it will not happen. What is happening right now in Zimbabwe connected to the MMM crash is called the Pause Mode. Nevertheless, this pause mode has lasted in Zimbabwe from August 2016.
MMM E.Africa admin assured that they are trying to do everything in their power to start moving the Zimbabwe MMM company in the right direction. Nevertheless, the admin still provides the information that it`s known that Zimbabwe MMM train goes too slow, but it still goes… MMM admin also assured that everything that happens in Zimbabwe couldn't happen in Nigeria. It means that Nigerians can “safely” invest their money into MMM crash Ponzi scheme and expect that their money returns back in the nearest future. MMM E. Africa admin also complained that unnecessary panic. It makes some problems for the investment climate for MMM company.
MMM crash and Nigeria
The same scheme of MMM company runs in Nigeria. Its current name in Nigeria is MMM – the Federal Republic of Nigeria. Lots of Nigerians invested their money to this Ponzi scheme. Nevertheless, it`s only the beginning. According to the MMM crash history, everything was well at the very beginning, but with time when a number of new members and their investments couldn`t outreach the amount of money that should be given to the old members, MMM crash starts happening. It worked well in Russia in the 1990s, it worked well in Zimbabwe. Still, it`s only the beginning and Nigerians who invested their money into this Ponzi scheme can enjoy their dividends, but for how long?
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