MMM Founder To Be Jailed 6 Years, Business Shut Down By Govt: South Africans To Lose Money

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A NEW Russian law that makes Ponzi schemes illegal could add to the troubles of the South African MMM community, whose global founder is Russian.

Russian President Vladimir Putin signed a government bill in March introducing up to six years of jail time for organisers of Ponzi schemes.

A NEW Russian law that makes Ponzi schemes illegal could add to the troubles of the South African MMM community, whose global founder is Russian. The founder now faces 6 years in Jail, and the entire business will be shut down and South Africans will lose all their money. Russian President Vladimir Putin signed a government bill in March introducing up to six years of jail time for organisers of Ponzi schemes.
A NEW Russian law that makes Ponzi schemes illegal could add to the troubles of the South African MMM community, whose global founder is Russian. 

A Ponzi scheme is an organisation that operates through fraud. Investors are tricked into thinking they can get quick returns on their investments. At first the organisers do pay people out, encouraging others to invest. Eventually the scheme collapses and the organisers flee with the remaining money.

It is now against Russian law to organise a Ponzi scheme that takes more than 1.5 million rubles (R320 000) in assets from people.

This is according to the Russian Legal Information Agency’s website.

The Russian founder of MMM Global, Sergey Mavrodi, served jail time for his MMM Ponzi scheme in 2007, but re-launched MMM on his release in 2011.

He launched MMM South Africa in February 2015 and the “community” has grown in large numbers.




With the law in place, Russian investigators will likely go after Mavrodi first, explained BehindMLM, a blogsite that investigates such schemes.

Members of MMM in Mzansi have been sharing stories of their continued success on MMM. They describe the platform as an online community for money sharing, not a Ponzi scheme.

But consumer experts have warned that it has all the signs of a dodgy pyramid scheme.

The National Consumer Commission investigated MMM along with eight other schemes in 2015, and has handed over its findings to the Hawks.

The Hawks said last week there investigations were currently delayed.

  • Fin24

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