Not few Nigerians were swooned by the Mavrodi Mondial Moneybox just little less than three years ago. And now again as a people who love to be cajoled, Nigerians welcome another ponzi scheme with arms wide spread and doors flung open.
Loom money Nigeria is clouding the space like an epidemic.
Targeting the young and upwardly mobile and pulling all gullible into its dragnet in an economy where poverty has broken all levers of good financial reasoning.
Like MMM, Loom Money Nigeria is offering to pay massive returns of 8 times value in returns for investments as low as N1000.00. That’s 8.000.00 naira for every 1000.00 and 80,000.00 for every 10,000.00 within 48 hours
The Loom Scheme is neither new nor peculiar to Nigeria. Elsewhere, it’s also known variously as “Snowflake Blessing,” “Christmas Wheel,” “Circle of Trust”or “Infinity Loom,”
Generally it starts with a passive-aggressive invite, in this case a Facebook post or WhattsApp, letting people know that the Loom really works and if you’re serious about ‘cashing out’ just like them, direct message them for details.
To join their Loom, you must send a one-time payment.
Your name takes a space on the outside of the loom. To get to the center of the loom, where you’ll cash out, you must recruit two other people to also make a one time investment. They too will also recruit two more people.
If you and your loom can recruit people quickly enough, you potentially can collect your 8X pay out in a few hours, at least that’s how it claims to work. Unfortunately, many people buy in without ever getting a return on their investment.
Founders and origin
Loom has no major promoter and operates on the social media via closed groups on Facebook and WhatsApp. Its system is also porous as anybody can create a group either on Facebook or WhatsApp, lure people to pay and shut them out afterwards.
In most instances, the Loom promoter is the only Admin and make judgement on the outcome of the pyramid structure.
Also there is clear cut defined terms and conditions – the only known condition is for people to bring in cash and well as eight other contributors before cash out.
No matter what name it goes by, according to Mississippi Attorney General Jim Hood, the Blessing Loom is nothing but a pyramid scheme.
- Promise a consumer that they will make money with very little effort or investment.
- Pitches include persuasive success stories of how many other people have made money from the same venture without providing concrete facts.
- Revenue is generated from bringing in new members or friends to buy into the program.
One of the places where the Loom had been most popular is Jamaica where it raised the hope of millions of people by the and just like MMM by December 2018, it dashed the end of year dreams of millions of people. It collapsed.
In the wake of which, Jamaica’s investments watchdog warned locals not to be duped into Ponzis whose chief solicitors are high-profile professionals.
Highlighted in an October 2018 exposé by The Sunday Gleaner, the rise and fall of Loom has seen one of the alleged founders murdered; a popular social media personality in fear for her life; and millions of investor dollars going up in smoke. The illicit scheme, which used social media to attract investors, promised 300 per cent in earnings.
“You tend to have some schemes that are promoted by so-called professionals – doctors, lawyers – and people tend to give that more credence, and they say, ‘Well, it’s a doctor, it’s a lawyer, so therefore, this can’t be that bad,’” David Geddes, communications and international relations manager at the Financial Services Commission (FSC), told The Sunday Gleaner.
Last month, Daily Mail UK reported that the scheme has resurfaced online all over the world, with different names such as ‘loom circle’, ‘fractal mandala’ and ‘blessing loom’. In Nigeria, its central name is Loom Money Nigeria with individuals creating their own WhatsApp groups such as Preye Loom, Catherine Loom among others.
“Each time 8 people join the group, the person in the centre (usually on the red spot) gets the target amount which is N16,000 and after investing N2,000 leaves the spot for the next person.
“The Loom would then be split into 2 groups, the top half and the bottom half each becomes new groups and everyone moves into the next level.
“Which means those people that were in purple move to blue, those in the blue move to orange, and those in the orange move to red (the final stage and the cashing out stage).”
Some Nigerians who ha already invested in the Loom platform have threatened to do to the promoters what they did to the Russian Ponzi schemer Sergei Mavrodi of MMM who died at 62 of heart attack after millions of Nigerians lost billions of invested money.