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00:00 Itoko market women are the latest victims of Ponzi schemes in Nigeria.
00:15 In months past, news made rounds on social media about how millions of unsuspecting Nigerians
00:20 looking to invest their money or double it had been swindled through well-organized Ponzi
00:24 schemes.
00:26 So how does it work?
00:27 Ponzi schemes are fraudulent investment operations that promise high returns with little or no
00:32 risk.
00:33 They mainly offer quick wealth to unsuspecting individuals.
00:36 Over the years, some have unfortunately gained popularity.
00:40 But first, let's discuss what they all have in common.
00:45 Pyramid schemes and multi-level marketing.
00:48 They rely on recruiting new members to sustain the promised returns.
00:51 The more people you bring, the more money they make, but they always have a way of making
00:55 it look like you're helping yourself.
00:59 Investment clubs.
01:00 They create investment opportunities as legitimate financial organizations, soliciting funds from
01:05 members with the promise of high returns.
01:07 However, they often lack the necessary licenses to operate, leading participants to huge financial
01:14 losses.
01:15 Lastly, crypto-based Ponzi schemes.
01:18 With the rise of cryptocurrencies, Ponzi schemes leveraging on digital currencies have also
01:23 emerged.
01:24 They typically promise quick and guaranteed returns on cryptocurrency investment.
01:27 Still, they are often unsustainable, eventually resulting in significant financial losses.
01:35 Some of the most popular Ponzi schemes to have gained popularity in Nigeria include
01:39 1.
01:40 The Mavrodi Mondial Money Box (MMM Nigeria)
01:43 Who could forget MMM?
01:46 They gained widespread attention in 2016 as one of the most prominent Ponzi schemes in
01:50 the country.
01:52 It promised participants a 30% monthly return on their investments.
01:56 However, the scheme eventually collapsed, causing substantial financial hardship for
02:00 many individuals.
02:03 Then followed the likes of Ultimate Cycler where participants were required to make an
02:06 initial investment and recruit others to join, which of course still crashed.
02:11 A few others like Twin Cars, Imagine Global Solutions, Pennywise, Raxteli, Binayan Thought,
02:18 Quintessential Investment Company, The Map Engine Investment, Votac Global Capital, AgroPartnership,
02:25 Pockeon and iCharity have emerged to name a few.
02:29 It is important to note that Ponzi schemes are illegal and unethical.
02:33 Engaging in such business can lead to severe financial consequences.
02:37 It is always advisable to exercise caution and conduct thorough research with professionals
02:42 before participating in any investment opportunity.
02:47 Ponzi schemes mostly have the same red flags.
02:49 Here are some warning signs.
02:52 First and foremost, high returns with little or no risk.
02:56 Every investment carries some degree of risk, and investments yielding higher returns typically
03:01 involve more risk.
03:02 Be highly suspicious of any guaranteed investment opportunity.
03:06 In addition, overly consistent returns.
03:10 Investments tend to go up and down over time.
03:12 Be skeptical about any investments that regularly generate positive returns regardless of overall
03:17 market conditions.
03:19 Thirdly, unregistered investments and unlicensed sellers.
03:24 Ponzi schemes typically involve investments that are not registered with the Security
03:28 and Exchange Commission or with state regulators like the Nigerian Deposit Insurance Commission
03:33 (NDIC).
03:34 Proper approvals from regulators is important because it provides investors with access
03:39 to information about the company's management, products, services, and finances.
03:46 These regulators can also help recover or refund your investment in case something goes
03:50 wrong.
03:51 Lastly, difficulty receiving payments.
03:54 Be suspicious if you don't receive a payment or have difficulty cashing out.
03:58 Ponzi scheme promoters sometimes try to prevent participants from cashing out by offering
04:03 even higher returns for staying put or reinvesting.
04:06 Remember, if it's too good to be true, it probably is.
04:10 Have you ever been a victim?
04:12 Do not hesitate to share your story in the comment section.
04:16 [Music]
04:20 (upbeat music)