Nowadays, there are a huge number of different financial institutions in the world that promise their depositors one or another “reward” in the future, as a rule, much more than you can get with a bank deposit. One such structure is the financial pyramid. Sometimes it is called investment, but this does not change the essence of the matter.
There is no direct ban on such activities in Russia, although S. Mavrodi once did everything to ensure that the phrase “MMM financial pyramid” is remembered for a long time by many deceived investors. There is such an expression, "History teaches that it teaches nothing." The new Mavrodi financial pyramid, which he organized in 2011-2012, again found those wishing to receive quick and fabulous profits, and there are still people who believe that MMM is a unique chance to secure its future.
What is a financial pyramid?
All existing organizations of this kind belong to one of two types:
- Ponzi schemes
- layered pyramids
The Ponzi scheme got its name from the surname of the entrepreneurial American Charles Ponzi, who launched such a pyramid in the USA in the early 1920s. Despite the fact that such schemes were known until this time, it was the financial pyramid of C. Ponzi that, due to the participation of a large number of people, received very wide publicity in the United States.
The principle of its work is that the organizer promises potential participants to invest in the project, while promising a "guaranteed" and very high income in a relatively short time. Participants do not need to attract new partners - they just need to wait a certain period. In the beginning, when the number of people in such a project is small, the organizer pays them money from their own pockets, then satisfied old participants start investing again, rumors of incredible profits widen and the number of people wishing increases. As soon as the flow of new participants begins to weaken markedly, the organizer appropriates all the money and hides. Based on this principle, the MMM company and B. Medoff investment firm were organized.
The multi-level financial pyramid works a little differently. Under this scheme, each newcomer must first make an entry fee. This amount is immediately divided between the person who invited such a newcomer and the earlier members of the pyramid who invited the person who had already invited. After the initial payment, the newcomer is obliged to attract at least two more people and this process continues with each new level. Sooner or later, such a multi-level pyramid also crashes. The reason is quite simple: for such a structure to work, it is necessary that the number of participants grow exponentially, i.e. very fast. For the first 10-15 stages, even the entire population of the country may not be enough. Therefore, about 80-90% of participants after paying the entry fee are left with nothing.
How to recognize a pyramid?
With the development of the Internet, more and more various projects are appearing that offer fast and guaranteed money making, while practically not wasting their time. And there are people who believe these promises, transfer money … and then puzzle over how to return them. In each of us deep down in our hearts there is a child who wants to believe in miracles, freebies and superprofits. Therefore, this is happening …
In order not to fall for the bait and not lose your savings, you need to check three things from the project you are interested in:
1. Does the project promise huge profitability? If the promised profit per month should be more than 30%, then this is the first sign of a pyramid.
2. Powerful advertising and PR. Pyramid organizers always at first strive to attract as many people as possible.
3. Ease and simplicity of logging in together with a small contribution.
There are a lot of financial pyramids, they exist on average no more than five years, and then reappear under a new name or in another place. You can earn in them only on condition that you are lucky to be among the first participants, however, is it worth doing at all? I believe not, and I hope that you will absolutely agree with me.
