Analyst reacts to SEC warning on scheme
By Anthony Opara
My attention and those of my friends has been drawn to a recent news report to the effect that the Security and Exchange Commission (SEC) has warned the public to stay away from an online company called MMM Federal Republic of Nigeria which is promising Nigerians 30% of their investment when there is nothing that they are offering and there is no business model to support their operations.
One question we have for SEC is this: what is the business model being used by Nigerian banks that pays an individual N13,600 when the person fixes N2 Million for sixty days. What do banks sell that makes them make huge profits but pay pittance to their workers? Let us not forget that before the Minister of Labour intervened and called for a halt, several Nigerian banks had laid off their workers on the excuse of the worsening economic climate. Interestingly, some of the workers laid off had worked in the banks for over twenty years.
While the SEC referred to MMM as a Ponzi scheme the commission refused to tell the public that banking is the greatest Ponzi in this nation. Have we forgotten so son the failure of several banks and the huge losses that accompanied the failures while their owners went home free? Where are Mrs Cecilia Ibru of the former Oceanic Bank and Dr Erastus Akingbola, the former CEO of the equally defunct Intercontinental Bank who allegedly destroyed their banks and the lives of several Nigerians yet SEC which ought to have better regulated them is now talking of Ponzi scheme. Have we forgotten Abacha’s failed Banks Trubunals and the several top bankers that went to jail? The rot in the banking system didn’t start today but Nigerians are still banking, entrusting their money to rogue bankers who sell nothing but schemes!
What we know about MMM is that Sergei Mavrodi, a Russian came to the rescue of people with financial challenges by creating a community of people who freely donate money to each other and generate the profits they share. Rather than applaud him rogue bankers are saying it’s a Ponzi scheme. Every business venture is a risk and if you don’t like the heat you had better get out of the kitchen. There is a clear warning on the website of MMM requesting that you are only required to provide help with spare money so people participating in MMM understand the risks.
Indeed in our current circumatance today, it is arguable that the scheme may be better than working for states like IMO, BENUE and NASARAWA where salaries have not been paid for over five months even after the President gave them bailouts! What is riskier than working in a company for eleven years and coming to work one day to be told your services are no longer required because the managers of the concern had grossly mismanaged its affairs. This story is a recurring decimal in the Nigerian labour environment. During the Abacha era, I covered the trials of most of the captains of the banking sector who bagged several huge jail terms. In one instance, Chief Kingsley Ikpe who was accused of fiddling with funds of his customers was sentenced to 120 years imprisonment. His wife was in court the day the judgement was handed down. He was a so-called Security and Exchange operator.
Banks are now jittery that they will lose customers so they are hiding under the SEC to threaten an entity that they do not understand. Unlike NOSPECTO or Umana Umana in the past, there is no account for anybody to clamp down on. Nobody pays any money into any central account. Participants pay each other. Please tell me when it has become a crime to assist a friend? For many observers, both Umana Umana and NOSPECTO were shut down by jealous federal agents who did not understand what was happening. There was no time anybody reported Umana Umana for not paying until the Police intervened and carted money from his office in Port Harcourt which in turn led to the collapse of the business.
For this writer, he has no grouse with MMM. It’s as simple as a group of Nigerians helping one another. Let no SEC or bankers interfere in something that is reportedly changing the lives of ordinary Nigerians. There is no where it is stated that government had assisted those Nigerians who lost huge sums when banks collapsed, but rather people lost their jobs, their money and in some cases lives. MMM is not the problem.