Tuesday, 25 October 2016
The season of the Ponzi scheme is on us again:
The Ponzi scheme also known as Pyramid scheme is once again alive and kicking in Kenya. One having its origins in Russia 20 years ago has been reported in the newspapers today as having taken root a few months back and is still going strong raking in millions of shillings from ever gullible Kenyans and this despite free advice from the government and concerned experts to the public to stop engaging in these dubious schemes.
A similar scheme has already collapsed in Zimbabwe to the great disappointment of many and the scheme is also running in several other African countries with incredible success if the newspaper reports are anything to go by albeit with criminal investigations ongoing in one African country.
Which begs the questions? Why do people tend to trust their hard earned money to total strangers with tall stories of get rich quick return on investment schemes (or scams)? Why do people ignore the sage advice of their government and other more discerning people? Who shall whip the greed and stupid out of these people because it is nothing other than these emotions that propel people towards these scams?
These games of ‘pata potea’ have been there from time immemorial. From the three cards Monty of yore to the sophisticated and intricate Ponzi schemes of today, people have lost and shall continue to lose money simply because of their greed for quick riches and the allure and sweet tongues of those with the gift of the gab.
At present there is a lobby group that has a case in court fighting what is no doubt a losing battle to recover billions of shillings lost 10 years ago to other unscrupulous people who engineered Ponzi schemes in the country. Similar sordid and sorry tales continue to be told across the world with entire countries still counting the cost of these Ponzi schemes on their economies.
It is very likely that the quantum of reported losses is much higher than the amount stated of Kshs. 8.1 Billion because a vast number of people who may have lost small amounts of money may have decided that the cost of pursuing what they lost was not worth the time and effort of follow up. Similarly it is also likely that there are other cleverly disguised Ponzi scams out there that are yet to be unearthed and which have already found their way into the minds and psyche of many Kenyans investors.
There appears also to be a direct correlation between the politics of Kenya and these Ponzi schemes because the game of politics firstly is a ‘pata potea’ as well. The winners ‘pata’ the spoils and continue feasting on meat at the table as was recently reported by the holder of the highest office in the country, while those who ‘poteza’ are salivating as they wait their turn to feast. It is also clear that the election campaigns have started in earnest with each side out to convince Kenyans that their message is better than the other side’s message and in blatant disregard for the law which specifies that the electioneering period within which aspirants are expected to campaign shall be announced well in advance all the more reason for these Ponzi’s to thrive.
It is also more than probable that the timing of these Ponzi schemes (along with the now well entrenched sports betting) is nothing more than a well calculated move to raise the much required campaign funds from a gullible public seeking to earn a 100% return on investment in no time flat through some dubious and unscrupulous schemes out there.
Further, with the recent enactment of the capping of interest rates on both lending and fixed deposits by commercial banks anyone who promises a fantastic return on a cash investment is sure to have a long and growing queue of investors seeking to throw their money at the said scheme regardless of the inherent risk lending credence to my theory that these Ponzi schemes are nothing but avenues for fundraising to finance what is likely to be a very high stakes campaign period as we head to another general election in 2017.
For the record, I do not participate in fund raising activities for political campaigns or even individuals aspiring to a political position something that I have held for many years so I will neither encourage nor participate in any games of chance or betting whose funds are likely to find their way to the coffers of an aspiring politician or political party. My hard earned money shall continue to earn a pitiful return on investment at the bank or be channeled to more tangible assets.
Silly season is fast approaching and I warn you that any sweet deal that promises you a return on investment greater than what banks are offering at present is likely to be nothing more than pie in the sky or manna from heaven and a myth perpetuated by people with ulterior motives to separate those gullible enough from their money.
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