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Capitec started freezing accounts involved with RSA MMM


The global unit of the alleged Russian Ponzi scheme, MMM, has collapsed, after a failed BitCoin “experiment” failed to pay out clients.
The scheme, which was established by convicted Russian fraudster, Sergey Mavrodi, posted a notification to its Facebook page, saying that it had to close down “the Republic of Bitcoin” – a website that promised up to 100% returns on donations.
“It was an experiment, and, unfortunately, it failed. We turned out not to able to pay 100% per month. We can easily pay 30% per month (and we proved it in practice in many countries), but 100% is too much even for us,” the group said.
According to multi-level marketing (MLM) investigation publication, Behind MLM, the shuttering of the site is evidence that the scheme has collapsed – and that all similar schemes linked to the business in the various countries it operates in will soon follow suit.
The site predicted the collapse a day prior to it happening.
“The only reason a Ponzi scheme stops paying out is if there are banking issues or they run out of money. MMM Global’s use of BitCoin rules out the former, so with investors not paid out for over a month the writing was on the wall.”
“MMM Global cannot sustain paying out more than is invested. And as long as affiliate investment is the only source of revenue entering the scheme, any MMM Global scheme will ultimately collapse,” the report said.

MMM South Africa

Mavrodi, who usually posts weekly video updates on the scheme’s Facebook page, has not done so, and is speculated to have gone into hiding.
The South African branch of MMM ran into trouble earlier in the year, when Capitec started freezing the accounts of customers tied to the scheme.
The bank said that its security systems automatically pick up on suspicious activity in accounts and freezes transfers until an investigation takes place. The bank faced backlash from clients who invested in the scheme.
Users say the scheme works just like a stokvel, and that the banks should not get involved in how they spend their money.
MMM is under investigation with the National Consumer Commission listing it as a potential pyramid scheme. The Consumer Protection Act describes any scheme that offers returns 20% above the repo rate (6.25%) as a “multiplication scheme” – otherwise known as a Ponzi scheme.
The group’s hook is the promise of high returns on investments – as much as 30% per month – along with “testimonials” from clients who claim to have achieved great success with the scheme.
Despite this, the scheme says explicitly that it does not guarantee anything, warning users that they might not be paid at all, and indeed, could lose all their money.