While many MMM subscribers believe banks, the Hawks and the media are out to get them, the truth is that the investment sector genuinely wants to protect people from products that are likely to wipe out their savings.
The message from Peter Dempsey, deputy CEO of the Association for Savings and Investment (Asisa), is that the media as well as the savings and investment industry has a duty to help consumers distinguish between legitimate products and those that are likely to cause financial losses.
This follows questioning from Fin24 users about why an alleged pyramid scheme like MMM is any different to regulated savings and investment products.
Fin24 has been inundated by emails from MMM supporters, most of whom vehemently defend the scheme and believe the financial establishment has a warped view of what it is all about.
Fin24 user siyagumede73 writes: "I really think you guys should not publish lies out there. MMM is for us and it here to stay so get over it."

Another typical response is from Lerato, who writes: "I have built a half a million rand house with the money I have invested with MMM and I don’t think there is a problem with it."
Fin24 user Maya writes: "Obviously the Bank and powers in control - will fight this because of fear and losing their control and manipulation grip on the people. #News24 can't get to grasp what is really going on and think they play hero to 'Rescue' the people who are too stupid to decide for themselves! As they are insinuating!"
Fin24 users caught in the debt trap say they use this underground method to find what they call financial freedom.
Fin24 user M Mhlongo says that with MMM, there is “no more paying loans for a long period from banks”.
Questioning the criticism of MMM, Fin24 user C Sithole asks: “is it because we have exposed their (banks') exploitation on the interest they give us when we bank with them?”
Fin24 user M Ralekholela says “banks survive by taking from ordinary people and make money for themselves”.

Fin24 user K Maesela says
“if you find comfort in putting your money in the bank, great, but always remember this. If you put R10 000 in the bank for five years, you'll make around R12 500. If you get a loan for R10 000 for five years, you will pay back around R22 000 if not more.”

However, there are those who sound a note of caution. Sboniso Ngobese comments: "I don't think that MMM is ilegal but members can eventually lose their money if allegations contenue and end up affecting how the system works. It can stop runing smoothly by the way."
Fin24 user Jozy is on the verge of panic: "However I have three days now since I asked for help. I haven't received the funds thus far. I was told to be patient by a friend who referred me there. He said it takes about 72hrs for payments to be disbursed. Not more.  I'm scared. I saw someone on twitter claiming that there's a problem with payouts. I stand to back up that claim."
Smart Mahlangu has seen it all before. He writes: "I lost money through Defence X, and what hurt me the most is that the same people who lost with me are the ones that are recruit people for MMM. I pity them when MMM collapse. They will blame everyone but not themselves."
While those in the debt trap are desperate to find their way out and are quick to blame the banks, Dempsey warned that schemes offering 30% returns, which MMM does via its donation-based system, should sound alarm bells.
Dempsey writes:
It is interesting to note that in the early days of a Ponzi scheme there are always more protractors than there are detractors. Only once the scheme has collapsed are there only detractors who question why nobody has warned the unsuspecting public.
While it is everybody’s right to speculate with their hard-earned cash in the hope of achieving unprecedented returns, it is nevertheless the duty of the media and the savings and investment industry to help consumers distinguish between legitimate products and those that are likely to wipe out their savings.
The sad reality is that Ponzi schemes are always based on seemingly good stories that invariably promise a financial outcome that cannot be achieved when you save or invest with conventional regulated products. These schemes feed off the human desire to buy into a compelling narrative, whether it is based on fact or not.
In order to get a monetary return from any scheme or product, you need to as a first step contribute an amount of money. The scheme or product provider then does something with this money, which determines the return you get, whether in the form of interest, dividends, a return of capital or insurance cover. What exactly happens to the money that you have paid and the transparency around that differentiates a legitimate product from a scheme that is not legitimate.
The question is, what happens to the money that is paid via MMM which enables the scheme to provide members with a 30% return? If the people behind this scheme are not able to disclose this information, then MMM is not a legitimate savings or investment product.
In the case of legitimate financial services products, the providers must be in a position to fully disclose what they do with the money entrusted to them by investors and how the product is administered.
For Fin24 users it is important to note that in the case of legitimate products the following will always apply:
• The product provider can explain what happens to the money once you have paid it and is happy to disclose this.

• The business model can be verified by independent auditors.

• The product is subject to regulatory oversight and the investors, policyholders or scheme members have recourse if something goes wrong.

• There are similar products available in the market place and investors can compare product features and returns.

• Returns fall within a similar range, because all product suppliers have access to the same transparent and regulated markets. Anyone offering returns that are much higher than the norm is either taking on excessive risk or is planning not to give every investor their money back.
If you are considering giving your money to a scheme or product and the points mentioned above do not apply, your warning bells should be ringing. The reality is that legitimate products cannot promise returns of 30%.
If you are faced with a tempting investment proposition, your best course of action will always be to discuss this with a trusted financial adviser. He or she will be able to help you see through the attractive narrative and help you make the right decision.

Source :fin24