Is it that Nigerians are so forgetful or it’s the bad economy policies employed by the government that’s making them get involved into Ponzi schemes that’s a scam?
Not so long ago, it was MMM, then swisgold, then this one then that one, now it’s LOOM.
Is it that Nigerians are no longer good at mathematics or it’s because of the poverty in the land that’s not making them calculate properly. How can someone tell me I should deposit 1,000 and get 7,000 returns in less than 48 hours. Not that the money was invested into a business, it was paid into someone’s personal account.
Here is how the loom Ponzi scheme works.
A Whatsapp group will be created and a maximum of 8 people are allowed in the group at a particular period in time. To join one of the many groups, one will pay the groups amount into the account of the leader, then you’ll be added to the group once the leader have confirmed the payment
They have different groups for different amount.
1,000 gets 8,000 called 1k loom
2,000 gets 16,000 called 2k loom
5,000 gets 40,000 called 5k loom etc.
Each group has a leader, to be added to a particular group, for example to join the 2k loom group, one will pay 2,000 to the leader of the group. So, if 8 people pays, the leader gets 16,000 (but actually he gets 14,000 because he didn’t pay 2,000 before joining any group, he’s the leader because he was the one that created the group), he’s expected to quit the group Immediately he gets 2,000 from 7 different people each, who will be added on first come first serve basis.
When the leader of the group quits the group, another person becomes the leader, then he and the other remaining group members persuades 7 other people to join the group, so the new people just joining’s money will pay into the new leaders account and he will get his 16,000, he’s expected to quit when he receives his own 16,000, that’s how the cycle goes on an on.
Advantage:
The leader gets paid on time, sometimes he’ll be the only one that get paid before the group will be scattered because it can be somehow hard convincing people to join a new group after what MMM has done to them.
If one eventually gets paid, it’s a profitable business.
Disadvantage:
Remember that when the leader gets paid he quits and leaves 7 people behind, who will then be looking for 7 new people to convince to join the group (they become 14 in the group, then another group will be created because the rule is that they must not be more that 8 in a group). Whoever is joining will automatically be the last person, he might have to wait till forever before it gets to his turn. The group that will be recreated from the first group created will eventually be 7 (in order for the every member of the first group created to be paid) which will consist of 56 people to pay 8 different people.
The maths don’t just match, so it’ll be a very big flop, but because of the ‘no money’ syndrome in Nigeria, people will still fall victim. They want to reap where they have not sewn.Knowing Nigerians for who they are, some of them will get money and refuse to quit the group, some can even create the group, join with two other different names, so when he gets the first one, he’ll quit and still automatically become the leader again with his second account then get paid again, quits and becomes the leader with his other account again, and he’ll keep on getting money from the new people just joining.
How is it different from MMM?
The outcome of loom is much more than the outcome of MMM, I.e. the money one will be getting is more than that of MMM.
In MMM, it’s the MMM that links one to the person that will pay you, but in LOOM, you’ll be the one convincing people to join the scheme.
unlike the MMM which has a promoter, website and an office, the loom scheme doesn’t have any, so one can easily get scammed and the scammer can easily get away with it, and no one can be held responsible, no office to lock down nothing.
what’s the government saying about it?
The Securities and Exchange Commission (SEC) has issued a warning to Nigerians investing their money in an online investment scheme tagged “Loom Money Nigeria.’’ They warned strictly that it’s a scam, you can read more here: http://saharareporters.com/2019/05/16/loom-money-nigeria-scam-sec-warn-nigerians
Everyone knows things are hard and they are getting harder days, so why deliberately throw away money?
It’s for certainty that other Ponzi schemes are coming, we need to brace ourselves not to be carried away by the irresistible offer it’ll offer us.
Good morning and have a wonderful week ahead