Finance

Top 10 Ponzi Schemes in Nigeria to Avoid

Gullible Nigerians fall easy prey to Ponzi schemes as they are looking to get more with little or no risk. Many people don’t know how to identify these Ponzi schemes and as such become the unlucky victim.

What are Ponzi Schemes?

Ponzi schemes are investment frauds that pay existing investors from money paid in by subsequent investors rather than from any actual profit earned from the operation of a business.

The downside of these Ponzi schemes is that they are not intended to generate any returns for the investors concerned but to enrich the pockets of the Ponzi scheme organizers.

Ponzi schemes require a constant flow of new money to survive. It thrives on new investors as their money is used to pay existing investors.

If existing investors cash out and no new investors are recruited then the scheme fails woefully or collapse completely.

History of Ponzi Scheme

Ponzi schemes was named after Charles Ponzi who was noted in 1920 for his arbitrage scheme which proved to be a scam for paying off early investors with the deposit of later investors. His modus operandi was that he would double investors money in 90 days through an absurd plan to buy and resell international postal reply coupons.

How to Detect Ponzi Schemes

It is important to know how to detect these Ponzi schemes so as not to fall a victim. Any investment schemes that promise higher returns with little or no investment is probably an investment scheme you should simply avoid.

Another thing to look at for is for investment that generates high positive returns regularly regardless of the overall market conditions.

Ponzi schemes are non registered investment which doesn’t give 100% guaranty. It is not registered with the SEC or other regulatory bodies and such investors can’t get access to information about the finances, services, products, and management of the company.

Ponzi schemes are managed by unlicensed individuals or unregistered firms and as such your investment is good as written off.

Ponzi schemes tends to raise the hope of unsuspecting Nigerians who are looking to make quick money and this brings unwanted results of fraudulent practice.

In Nigeria, many of such Ponzi schemes are everywhere and because of the bad economic situation of the country, people tend to fall victims because they are looking for quick returns with no little or no risk involved.

In this article, you would get to know the Ponzi schemes in Nigeria you should avoid, so as to have a safe investment with no cause for alarm or worry.

Top 10 Ponzi Schemes in Nigeria to Avoid

The following are the top 10 Ponzi Schemes in Nigeria to avoid:

1. Loom Money

Loom is a Ponzi scheme you should probably avoid as it is targeted at gaining many investors with the ideology of referral and cash out when you are able to refer 8 persons.

It is a platform that utilizes the WhatsApp chat groups for its operations. It deals with four levels which consist of Purple, Blue, Orange and Red.

How does it work? When you join the Loom WhatsApp group, you would be required to invest the sum of #1,000 and #13,000 with a promise of 8 times your investment only if you invite one person to join the group.

This scheme is more like put in your money and cash out fast before it crashes but the actual fact is that the scheme only thrives on the number of people who come in as investors regularly as money invested by new investors are used to settle existing investors.

Read Also: Reasons Why You Should Never Participate In Ponzi Scheme

2. Loopers Club

This is yet another Ponzi scheme you should be wary of as users have tagged them as “thieves” and “shady”.

Loopers club describes itself as a multinational platform where members help one another financially in their time of need.

There was a time when Loopers Club went into maintenance but when it came back, all the investors details had been wiped clean leaving no history which got many investors angry as they were asked to register and invest again or suffer a deleted account.

In spite of what happened, unsuspecting people are still joining.

3. Help Naija

This platform operates on WhatsApp and assures investors 30% of their investment every 10 days they are pair with some other investors.

It also promises 10% fast transfer commission and 10% referral bonus earnings on people you invite or refer to the scheme.

This is too good to be true Ponzi scheme that people should avoid as its lack of popularity doesn’t prove it otherwise.

4. NNN Nigeria

This is another obvious Ponzi scheme that should be avoided as it is like MMM Nigeria which crashed back in 2016 when lots of people lost their money as well as their lives.

NNN Nigeria describes itself as a community that helps millions of users worldwide to connect to those who are willing or ready to provide help.

It simply functions like its predecessor and should be probably avoided to not have the same occurrence of the bitter past.

Read Also: Top 10 Risky Investments You Should be Careful about or Avoid In Nigeria

5. Twinkas

This is a quick money scheme that promises its members a 100% return on investment without referral after a period of 21 days. It has four different packages which consist of Classic, Professional, Premium and Ultimate.

The packages offer unbelievable returns for the amount invested which is a sign that this is a Ponzi Scheme one should avoid.

6. iCharity Club

This Ponzi Scheme follows the same pattern as it requests a fee of #6,000 after registration which must be paid not more than 2 days after registration.

It operates with Grades which is from 1 to 10 and payment of #6,000 after registration puts the member at Grade 1 and entitles him/her to 5 times the initial deposit which is 30,000 naira. You can only be paid when you bring three persons into the system.

This is probably one Ponzi Scheme in Nigeria you should avoid so as not to be devastated.

7. Paradise Payment Nigeria

It is a member to member donation platform and members donate directly to other members without any third parties. It starts with little as 1,500 naira and as high as 10,000 naira.

After registration, you would be asked to make a donation to the supposed member in need of help which must be done within 12 hours. You become a Pro member when the member confirms receipt of your donation.

This is a scheme that should be seriously avoided as it is not different from other Ponzi Schemes out there.

Read Also: Impacts of Ponzi Schemes on Nigeria economy

8. Greenspeer

This Ponzi Scheme works by you investing 5,000 naira into a members account to which you get 10,000 naira from two persons that puts you in level one and the ultimate level is 5 where you invest 100,000 naira to get 1,000,000 naira. This is a red alert scheme you should avoid.

9. Global Cash Nigeria

This is simply the same as the other Ponzi Scheme you should definitely avoid.

10. Get Help Worldwide

This Ponzi Scheme Promises 30% profit within 30 days to which not much information is disclosed. You should avoid this Ponzi Scheme as it has scam written all over it.

Conclusion

Ponzi Scheme is very old dating back to history but many people fail to recognize such schemes and end up as a victim. This article has been able to put together the Ponzi Schemes to avoid so as to be a safe ground and not be sorry.

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Cynthia Victor

Cynthia Victor is a Content Developer at InfoGuideNIgeria.com. InfoGuide Nigeria is a team of Resource Persons and Consultants led by Ifiokobong Ibanga. Page maintained by Ifiokobong Ibanga. If you need a personal assistance on this topic, kindly contact us.

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