What is MMM? MMM is in fact a pyramid scheme, a system whereby the money goes up but very little comes back down. The Consumer Protection Act describes a pyramid scheme as any business model that promises investors an annual interest rate of 20% above the repo rate, which is currently at 7%. A scheme which has been investigated by the National Consumer Commission, with all related information handed to the SA Police Service for further action.
As it stands, MMM claims to pay out between 20% and 100% per month, but makes it clear that this is not a promised amount but rather hinges on whether or not someone wants to offer you “assistance”. The participating members take their income or returns mainly from the roping in of new members. In other words, the returns are not based on investments or the selling of any product, but on money paid by new people joining the scheme – no new members, no more money. The philosophy is that you offer assistance by paying a joining fee. Using a simplistic example, if all members pay R1 000 to join and the monthly return is 20% (R200), then as a new member, you pay R1 000 to “assist” other members.
This R1 000 would be divided among five existing members, giving them each R200. The next month, you receive “assistance” and a portion of the next new members’ joining fee is allocated to your account.
MMM uses a virtual currency called Mavro, which is purchased via the official virtual Bitcoin currency. It can only be estimated as to what your Mavros are worth in Rands as it is determined by how much someone buying or selling Bitcoins with Rands would be willing to pay.
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