MMM is a Ponzi scheme, Don’t fall for it- SEC warns Nigerians

The securities and Exchange commission released a warning to Nigerians via it’s website about an on-going investment opportunity where investors are promised an unbelievable 30% returns on their Investments.

See the warning Below:

Public Alert on the Activities of “MMM Federal Republic of Nigeria” (

The attention of the Securities and Exchange Commission, Nigeria (“SEC”) has been drawn to the activities of an online investment scheme tagged ‘MMM Federal Republic of Nigeria ( The platform has embarked on an aggressive online media campaign to lure the investing public to participate in what it called “mutual aid financial network” with a monthly investment return of 30%

The Commission hereby notifies the investing public that the operation of this investment scheme has no tangible business model hence it’s a PONZI SCHEME where returns are paid from other people’s invested sum. Also, its operation is not registered by the Commission.

The general public is hereby advised to distance themselves from this online scheme. Please note that anyone that subscribe to this illegal activity does so at his/her own risk.

Here is what you really need to know about MMM

It is obvious that many Nigerians are getting aware of this current Pyramid scheme trending in Nigeria called MMM Nigeria  which promises 30% Return on Investment(ROI) after 30 days.

The business is a Pyramid/Ponzi scheme,  Why would anyone call it a Pyramid/Ponzi Scheme ? First let’s examine what a Ponzi/Pyramid scheme is one should be wary of MMM Nigeria

A Ponzi scheme (also a Ponzi game or a Ponzi) is a fraudulent investment operation where the operator, an individual or organization, pays returns to its investors from new capital paid to the operators by new investors, rather than from profit earned through legitimate sources. Operators of Ponzi schemes usually entice new investors by offering higher returns than other investments, in the form of short-term returns that are either abnormally high or unusually consistent.

Initially the promoter will pay out high returns to attract more investors, and to lure current investors into putting in additional money. Other investors begin to participate, leading to a cascade effect. The “return” to the initial investors is paid out of the investments of new entrants, and not out of profits. Often the high returns encourage investors to leave their money in the scheme, with the result that the promoter does not have to pay out very much to investors; he simply has to send them statements showing how much they have earned. This maintains the deception that the scheme is an investment with high returns.

A financial watch expert has gone further to give more detailed information on the Scheme.

Unraveling of a Ponzi scheme

When a Ponzi scheme is not stopped by the authorities, it sooner or later falls apart for one of the following reasons.

  1. The promoter vanishes, taking all the remaining investment money.
  2. Since the scheme requires a continual stream of investments to fund higher returns, once investment slows down, the scheme collapses as the promoter starts having problems paying the promised returns (the higher the returns, the greater the risk of the Ponzi scheme collapsing). Such liquidity crises often trigger panics, as more people start asking for their money, similar to a bank run.
  3. External market forces, such as a sharp decline in the economy (for example, the Madoff investment scandal during the market downturn of 2008), cause many investors to withdraw part or all of their funds.

Why do FINANCIAL WATCH believe that MMM Nigeria is a pyramid/Ponzi scheme? lets look at the following reasons.

  1. The promise of a 30 % ROI is outrageous and not in terms with standard rates of investment (Example one makes a profit of 30,000 naira for every 100,000 naira invested in the system in 30 days , excluding additions that comes from referral, signing up and testimonial bonuses) No legal financial company can offer you that investment plan.
  2. Such “Return on Investments” been paid to older clients are money received from new clients and the circle continues, the 30% is never made from company profits. That is why there is aggressive ad campaign from the company(MMM Nigeria) paying massive additional bonuses to recruiters that they call guiders to conduct seminars and deceive gullible Nigerians into joining the scheme to keep the system alive.
  3. The CEO of the company(MMM Nigeria) Seigei Marvrodi is a convicted fraudster and had run similar fraud schemes in Russia where he defrauded  investors of over a billion dollars.

At this point it is pertinent to be weary of these kind of Ponzi scheme which promise too much to be true, while many Nigerians will continue to defend the scheme, according to many #MMMPays, yes it may pay now, but just like every other fraud, it strikes at a moment the investors express much confidence in their venture. So Nigerians should be wise and avoid unrealistic business ventures like MMM Nigeria.


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