Saturday 27 February 2016

Financial Advisors beware!

I’m not a big believer in regulation. My experience is that regulation often just leads to more and more bureaucracy, bother and hurdles for businesses to cross before they can sell things to their customers. The level of regulation in an economy seems to be inversely proportional to the productivity of that economy.

But occasionally regulation is a necessary evil.

There should obviously be some regulation of the food industry. Restaurants and supermarkets need to be inspected to ensure they are hygienic and pose no obvious threat to public safety. Food labelling, in particular things like expiry dates on risky products like meat and fish should also be controlled and monitored. These are things that help consumers make informed decisions about what and where they buy. That’s just basic.

The quality of certain key products such as water, milk, baby formula and electrical goods should also be regulated and controlled. These are things that pose a serious risk to our health and we have a right to know that these goods are safe and that any misbehavior by suppliers will be punished when it occurs.

I’m less convinced about things like regulation of things like internet access. We all know about extreme cases like North Korea and China who police what, when and how their citizens can surf the web and talk to friends, relatives and strangers online but you even see some countries blocking certain sites and facilities because of their over-sensitivity. Just last week Uganda blocked access to Facebook because of a fear that social media might influence their elections process although I suspect it was really a bit more sinister than that.

So some industries are best left alone, others need regulation. The financial services trade is one of them.

The main reason for this is because so many financial products are actually so difficult to understand. So few of us really understand things like trading forex and derivatives that there needs to be some enforcement of minimum standards of conduct among the people selling these things to us. We need to know that the people offering these things really do know what they’re talking about, have some credibility and will advise use as wisely and prudently as possible.

That’s where NBFIRA play a critical role. I’ve been saying good things about NBFIRA ever since they were first established. Like the Bureau of Standards they do a very good job, often very quietly, without great fanfare, making sure that we are protected from abuse. The work they did regulating the micro-lending industry has been remarkable. Our younger brothers and sisters won’t remember how things were 15 years ago. There were loan sharks everywhere. They were charging vicious rates of interest, taking clients’ ATM and Omang cards and behaving a lot like drug dealers. We heard of lenders who operated from car parks, from chicken restaurants and even a few who ran their lending businesses from their government offices.

But NBFIRA cleaned things up a lot and although there are still occasional abuses that industry is much safer than it used to be.

Their latest “target” has been financial advisors. These are the people offering you and me advice on how to manage our money and in particular where and how we should invest it. If you don’t have any personal experience of them ask your friends and relatives what they think and I think you’ll understand what this is an industry needing regulation.

I did another of our incredibly unscientific surveys on Facebook recently, asking people to say what they though of financial advisors using only one word. Barely a handful were prepared to say good things. The majority were scathing. Comments included: “Cunning”, “Tricky”, “Dodgy”, “Sly”, “Liars”, “Deceivers”, “Thieves”. You get the picture? This is not an industry that is well-respected.

At a workshop for financial advisors last week NBFIRA began the process of regulating them. From now on, anyone offering financial of investment advice must be registered with NBFIRA. Until formal regulations are published financial advisors need a formal, written exemption from NBFIRA in order to operate and a full list of those advisors who have registered and are therefore operating legally will be published on NBFIRA’s web site. Any company failing to comply will face a fine of P2,500. That doesn’t seem much but that’s per day. Every day they operate without being registered will be another P2,500. A few months of illegal operations is going to cost someone hundreds of thousands of Pula.

The good news is that as far as I could see every one of the advisors attending the NBFIRA workshop were keen to see these regulations in place, I assume so that their customers can tell the differences between legitimate advisors and the crooks damaging their reputations.

But here’s some even better news. At the workshop I asked NBFIRA whether these new rules could be used to stop people recruiting victims into pyramid and Ponzi schemes. The people representing schemes like Eurextrade and MMM Global talked about investments and profits so doesn’t that make them financial advisors?

The answer was actually quite simple. Yes, it probably does but that doesn’t matter. NBFIRA have the power to investigate anything along those lines, regardless of these new regulations. All we need to do is send NBFIRA an allegation and they’ll investigate it and take action if they feel it’s warranted.

As I said, I’m not a big believer in regulation but this is a very good example of what we need. A regulator that has been given some powers and that isn’t afraid to use them to protect the public.

All that’s left is for them to move on to furniture stores. As one MD told me years ago, they’re not really furniture stores, they’re moneylenders. Now if that isn’t a financial service within NBFIRA’s remit, what is?

The Voice - Consumer's Voice

I want my refund!

I bought tickets from a travel agent but when I got to the airport apparently they weren't paid for so I used cash I had. I immediately went to report to them last year July and they said they'd refund us. Now the agent keeps giving us excuses and no real answers as to when we'll get our refund.

How do I approach this issue?

I’m sorry to hear of your problem. Unfortunately this isn’t the first time we’ve heard of this happening. It seems to be a fairly common occurrence with a section of the travel agency business. They take the customer’s money and assure them that everything is booked, sometimes even producing what appear to be tickets, but they never actually pass your money on to the airline. It’s only when you reach the airport, and sometimes even the boarding gate, that you find out that the ticket you’re holding is worth nothing more than the paper it’s printed on.

A few years ago we dealt with two travel agents who were playing this trick on a number of customers. One of them ended up losing their franchise because of the bad name they were giving them, the other ended up in the “In The Matter Between” pages of several newspapers when one of their victims took them to court and seized their assets. It also turned out that the individual who had done this had a history of doing exactly the same thing with several previous employers, leaving a legacy of financial abuse behind him.

We’ll get in touch with this travel agent and see if they won’t do the decent thing and just pay you your refund. I’ll ask them if they want a story in The Voice about them. That usually does the trick.

Meanwhile if you’re thinking of using a travel agency I suggest you ask around first. Use one that a friend, relative of colleague can recommend based on their experience. Don’t leave it to chance.

I lost my card!

[I’ve removed the names of the two banks in this question.]

I recently used my Bank A ATM card to try and withdraw money from my local Bank B ATM. It was then unfortunately swallowed by the machine and I was told that I would have to apply for a new card as this other one will be removed and destroyed. I did apply for a new card and I was charged P56 for 'replacement' by Bank A which I find absolutely mad as it wasn't my fault I lost the card. I am also supposed to wait 10 working days for it. Their reason was that it was just the way things are done. Could you find out for me why such a ridiculous protocol is followed and if there's any basis for it or banks just want to profiteer and just inconvenience us.

There’s good news and bad news. We contacted your bank, Bank A, and they told what had happened. It seems that the Visa rules that govern this situation, when you use one bank’s card in another bank’s machine are very strict. Because Banks B has no records of you and your identity to check what you’re saying they can’t return it to you. Instead they’re required by these rules to destroy the card. That’s the bad news.

The good news is they are a bit confused about the P56. Our contact there said “I am still trying to confirm if indeed the client should have been charged the P56” so maybe you’ll get that back from them. We’ll see.

The lesson here is to be careful when using another bank’s ATM. In almost all cases it will work perfectly but when things go wrong it can be a disaster. A few years ago we heard of a case when someone used another bank’s ATM but although the money wasn’t produced it was nevertheless deducted from his account. In the month it took the two banks to sort this out he couldn’t pay his rent and was evicted by his landlord.

So be careful. Use your own bank’s ATM whenever possible.

Sunday 21 February 2016

MMM Global confess that they're a Ponzi scheme

I got a message on WhatsApp from someone called Peter who is part of the MMM Global Ponzi scheme run by Sergei Mavrodi, the convicted Russian serial scammer. It's quite amusing to see if you can get them to explain where the 30% per month they promise actually comes from.
Peter: I thought I'll c u ystday at the MMM presentation @ yarona lodge
Richard: Were you organising it?
Peter: I was part of it....r u still not clear anout how it works or u had a clear understanding now?
Richard: Realistically, how much money is it possible to make from MMM?
Peter: It depends on how much u put in. From as little as 200 u get 30% per month that is compounded monthly...
Peter: So the little u put the little u get....
Richard: Wow. How does the money actually make more money?
Peter: MMM is a community where people are helping each other...u help smbdy tday and u get helped by smbdy tmrw! Money is rotating from participants and the 30% is calculated amongs participants!!
Richard: But where does the 30% come from?
Peter: From participants!!! Let's take an e.g of banks: if u have an acc with the bank and u using it jst for saving your money and smbdy needs a loan frm the very same bank the bank uses your money to loan that person that will be paid back with interest. So the bank is getting the money to loan other people from people with accounts on that same bank....this is the same bro
Richard: So in MMM you pay interest?
Peter: all NO!!!
Richard: You compared it to a bank where loans are "paid back with interest".
Richard: Banks make money by investing customer's deposits, charging interest on loans and from bank charges.
Richard: You haven't explained how MMM makes money yet.
Peter: Yep...all im trying to highlight by making e.g of the vank is that the banks depends on people to make money at a high rate of interest and here u dnt pay interest but your money grows...
Richard: But how does it grow?
Peter: Say u put 1000 as an e.g and u r to get 2200 on the 3rd month the 2200 will be calculated amongs member's participating in the system that gonna donate to u that kind of money u r to get.
Richard: But how does 1,000 grow to be 2,200?
Richard: Where does the additional 1,200 come from?
Peter: From participants...
Richard: From new participants?
Peter: New and MMM u can topup your acc anytym...
There it is. The confession.

The money that fuels the "growth" comes from new participants and older participants feeding the scheme with new money. That is the definition of a Ponzi scheme.

Of course soon will come a time when they can't find any new gullible recruits and the scheme will collapse. Just like Eurextrade did, just like ALL Ponzi schemes do.

Friday 19 February 2016

What causes queues?

Who or what causes queues?

Are queues caused by the sheer number of customers? Are those queues we see at banks at the end of each month, the queues that leave the building, exit the shopping center and snake through the car park there just because that bank has so many customers? Are that bank’s queues just an effect of their success?

Maybe people actually enjoy queueing. It might sound ridiculous but many people have told me this. They’ve said that there’s something either in our culture or in our personal nature that actually enjoys spending time away from home or the office in long lines to get service. I’m not so sure. I’ve never actually met anyone who told me that they themselves enjoy it, it’s always been some mythical other person who enjoys it.

Last week I posed the question on Facebook. I asked what members thought was the reason for queues and we got a range of responses. Many of them blamed customers themselves.

One said that queues were caused by people “engaging in pointless conversations with cashiers and inserting their cards in and out of ATM machines several times”. Another said customers “always wait and take forever while chatting up a storm because they know that person forgetting all about the queues”.

Another blamed women. He (yes, it was a man) said “Ladies cause queues at the bank. They take time to take their purse out of their handbags, take some more time to locate their cards and more time to put them back in place. We all know this.”

One member made a rather smart observation about the failure to use technology. “To be honest I think in some cases customers in Botswana queue because of their refusal to use technology. You will find people in queues at BPC, WUC, banks, Multichoice to pay or deposit when all this can be done in comfort using online banking. If these people left the lines they would be much shorter.”

That has always confused me. Given how many things we can now do from a computer, tablet or cellphone why in 2016 do so many people with such technology insist on visiting in person? I don’t believe that idea that they do so because they enjoy it. They’re the same people complaining about the queues. I think it’s more complicated. I think it’s about a lack of confidence in the technology these companies offer. People of all ages simply don’t trust it, they don’t have the same level of confidence in a computer as they do in a human being.

But not everyone blamed the customers. Most people thought the blame could be found elsewhere. One said “Systems used by service providers cause queues”, another saying “Business practices does, think about banks, transport offices, post offices, shops etc its business practices I say!”

I think that’s closer to the truth. I think that the way a company does business can cause the queues. In fact I think it’s down to the management. Yes, management at the top but more importantly I think the blame can be laid firmly at the desk of the branch or store manager. They are the ones who are on the scene observing the queues and who should be responding with solutions when the queues become too long. If necessary they should be getting their hands dirty themselves, rather than being self-important and congratulating themselves on their position and power.

But maybe you don’t think managers should be getting involved in the day-to-day operations of their lcoation? Perhaps you think managers should be in the back office doing spreadsheets, writing reports and checking their emails? Well here’s a little something that I think is interesting about management. The word management doesn’t come from the English word ‘man’, it actually comes from the Latin word ‘manus’, meaning ‘hand’. It has the same root as the word ‘manual’, as in ‘manual labour’. Just as manual labour is work you do with your hands, management itself is about using your hands. The so-called ‘manager’ in the back office working on a spreadsheet isn’t a manager at all, she’s an administrator. A real manager would be out on the shop floor touching something, patting a well-performing colleague on the back, shaking a customer’s hand or wiping the dirty restaurant table because there are customers waiting.

So yes, a branch or store manager really should be out there on the floor helping to manage queues, ensuring that people are in the right queue, that they can’t use the ATM or their cellphone instead or that they can’t download what they need from the web site. That’s exactly what a manager is employed to do. They can do their spreadsheets some other time.

Finally there was one member of the group who was very cynical indeed. He said “Some foolish managers think queues are an indication that business is good. They do it deliberately by withdrawing tellers as you always see in shops and banks. Apparently if you are a manager and your boss pops up in your station and finds the banking hall empty, you get fired for not marketing the bank. But if he finds it full, you get a bonus even if its the same people standing there for the whole day.”

I think that might be going a bit too far but he does have a point. I can imagine how some managers want their bank or insurance company to look busy but they forget that by doing this all they’re actually doing is making their customers, their bread and butter, really angry and even more likely to go on Facebook and complain. Is that what they really want?

The Voice - Consumer's Voice

How does hire purchase work?

If you buy goods on credit and pay for some time and default and they are repossessed is the contract terminated? Or as the consumer you continue paying? If you continue paying do they return the goods.

Unfortunately, if this happens you have very few rights to protect you.

Firstly, you should know one key fact about hire purchase. Until you pay the final instalment the goods you think you’ve bought in fact still belong to the store. That sofa, hi-fi or computer that you thought was your property wasn’t at all. That’s why it’s called “hire” purchase. You were just hiring it.

Then there’s the issue of what happens if you stop paying the instalments. It doesn’t matter why you did so, whether you lost your job, had unplanned expenses or spent the money on beer, whatever the reason might be, the store will want their money and if you fail to pay them they are entitled to come to your house and take their property back. They don’t need court order to do this because you said they could repossess the goods when you signed the hire purchase agreement.

Even then, when the goods have gone it’s almost certain that you still owe them money. The repossessed goods will probably have been sold but only for a fraction of the amount you planned to pay for them. The item is no second-hand, has probably suffered some normal “wear and tear” and can no longer be sold as new. It’s also because the stores often sell the property to their own staff as a perk. Yes, the amount they recover will be deducted from your outstanding balance but I guarantee it won’t cover the full amount. You’ll still be left owing a debt, a debt for something you don’t even have any longer. Once they add on the various penalties and debt collection fees you can end up owing more than the cash price of the thing you bought. Sometimes you can even owe more than the full hire purchase price.

And guess what? You have absolutely no protection against this. Firstly because you voluntarily signed a hire purchase agreement that allowed the store to do all this and secondly because the law that governs these purchases, the Hire Purchase Act, almost certainly doesn’t cover you. That’s because the Act only covers purchases below P4,000 and almost all are way more than that. This is a law that urgently needs to be updated!

What is World Ventures?

I am always intrigued by the way that you help us to think and pick on scam wanting to rob us our hard earned money systematically. Please share with us what you understand about Worldventures. Some people have been trying to interest me to join and enjoy discounted travel expenses but I still would have to recruit people to join. I am yet to understand what product I will be selling as a member.

WorldVentures is a pyramid scheme and a scam. We’ve been warning people about them since 2009 when they took over an earlier pyramid scheme called Success University. They tell a story about offering travel discounts but so far I haven’t seen any real discounts. They certainly don’t have any discounts better than those hotel chains will offer you for free without having to pay to join a scheme and then recruit multiple levels of people beneath you the way WorldVentures does.

What pyramid schemes like WorldVentures really sell is the promise of income from recruiting multiple layers of people beneath you, each of whom pays to join and then starts a flow of money up the pyramid, some of which stays with you as it passes by. Of course this rarely happens because it’s almost impossible to recruit the number of people you need to achieve the targets the scheme sets you and the figures produced by WorldVentures prove this.

In 2012 WorldVentures published data on the income their US representatives earned from the scheme. It was sad. Firstly 77.5% of their representatives made no money at all. Nothing. Zero. Then 82% of small proportion people who made any money had a median annual income of a mere P200. Remember that's income, not profits. It's not money you can spend on yourself. Meanwhile the 1% of the people at the top of the pyramid took 84% of all the money.

Please don’t waste your money joining the WorldVentures scam. You’ll just be giving your money to that 1% at the top of the pyramid. They’re the only people who ever benefit from a pyramid scheme like WorldVentures.

Friday 12 February 2016

How to complain (again)

I don’t like being told what to do. Maybe I’m naturally a bit difficult but that’s just me, I react badly to being given instructions.

I react particularly badly when the person bossing me around is someone whose salary I’m paying. When it’s me paying the bills by spending my money in your store or with your organization I really dislike being told how I should or shouldn’t behave.

Company complaints procedures are a very good example of this.

Some while ago a reader contacted us to tell us about the complaints procedure he’d seen at a hospital he’d recently visited. It had ten, yes TEN, steps. If you had a complaint about the service you received you were first required to contact the Supervisor in charge, then the PR officer, then the Matron, then the Hospital Manager, then the Hospital Superintendent, then the Ministry of Health toll-free number, then the relevant Director in the Ministry, then the Permanent Secretary, then the Minister of Health and finally the Office of the President.

Given that everyone in this sequence is probably really busy and that some of them will be on leave, on training or attending typically endless Government meetings I can imagine that going all the way to the top of this sequence could easily take months. By the time your complaint gets to HE’s desk a year could have gone by.

That isn’t a complaints procedure. It’s a complaints avoidance procedure.

It isn’t just parts of the Public Service that makes complaining difficult. I’ve seen complaints procedures (almost) as complicated in parastatals, banks and retailers. They seem to think that their way of dealing with customer complaints should be as complicated as their organizational structure.

And some organizations can become VERY complicated. Thomas Cook, a UK-based travel agency appointed a new CEO a few years ago, Harriet Green. She reported on a BBC program that when she arrived the organization she discovered that it had 11 levels of management between her as CEO and the people that mattered most, her customers. She saw her primary task was to simplify that and that’s one of the reasons that when she left two years later, saying her work there was complete, their share price had increased tenfold.

However, regardless of the complexity of an organization the way they manage complaints should be simple.

That’s why we always recommend The Official Consumer Watchdog Three Step Complaints Procedure. Feel free to use this whenever you feel the need to complain.

Step 1. Complain to the person who offended you. It doesn’t matter if it was the person on the till who short-changed you, the waiter who brought cold food or the bank teller who disappeared when you reached the front of the queue. That person is the person to whom you should first complain. If they refuse to accept your complaint or don’t show suitable humility and contrition then you escalate to Step 2.

Step 2. Complain to the most senior person in the building. That person’s title will be something like “Branch Manager”, “Hospital Manager” or “Restaurant Manager”. Don’t bother with supervisors, administrators or team leaders. Only the most senior person will do. Then, if they fail to satisfy you, go to Step 3.

Step 3. Complain to the most senior person in the entire organization. Their job title will be either “Managing Director” or “Chief Executive Officer”. In special cases you might accept people with titles like “Country Manager” or “Regional Manager” but it absolutely must be someone who has the capacity to frighten the person who originally offended you.

Unfortunately, some people and some organizations simply don’t get it. They think that they are the ones who can dictate how their customers should behave. We saw this recently in our Facebook group. One member of the group posted a question asking for advice on which company to select in a particular industry but quickly the conversation focused on one specific company and they got a hard time from many people. That’s when an employee of that company, who it turns out is a fairly senior manager, said:
“we encourage our valued customers to continue reporting all issues as with all other faults through the existing channels and processes to be able to assist (not social media)”.
Did you see that last bit? We are only allowed to complain the way they dictate but “not social media”? Is he serious? We’re not allowed to complain on Facebook?

Are we suddenly living in North Korea? Are we not the ones who pay this guy’s salary? When did we become his employees, his debtors or his children. Those are all people he can boss around, not us. We are entitled to comment and complain wherever, whenever and however we feel and it is NOT his job to tell us otherwise.

As someone else in the group later said:
“I will air my grievances any how I like. I have gone through all the formal escalation procedures and have beared no fruit. If you were so concerned about customer service and retaining customers you would have made that info available for all to see when the problem started instead of waiting for us to complain first; that's how serious organizations do business.”
I’m certainly not saying that consumers are entitled to be rude to suppliers, that’s not how we operate in Botswana, we’re a polite nation but I think it’s enormously rude and patronizing of a supplier to start dictating to their customers how they should conduct themselves, particularly when they have a complaint.

Instead I suggest this. When you have a complaint you should remain calm, assert yourself and stick to our three step procedure. I promise you that you’ll stand a very good chance of getting exactly the result you deserve.

The Voice - Consumer's Voice

Can I get my money back?

I would like you to assist me regarding the payment I made but cannot be given what I paid for. I tried to register a company last year in February with a certain man. I paid him P700 for registration of the company and after some months he asked me to deposit P1,000. The total amount I paid towards company registration is P1,700 therefore I want him to give back my money because he failed to provide me with the service he promised.

Another issue is that in 2006 he promised to demarcate his plot and sell part of it measuring 40x40m to me. He asked me to pay the deposit of P3,400 before he can start processing the demarcation issue with the land board of which I paid and do have receipts with me. I gave him P2,000 on hand and the P1,400 was deposited to the account that he gave me. The total amount I paid towards the plot is P3,400. All these years he has been claiming that he was busy he has no time to go to land board but now I have realised that he was lying he just wanted to take my money and I want my money back.

1700+3400 =5100 this is the total amount he owes me because he did not give the service he promised.

I think there’s good news and bad news. The good news is that it should be possible to recover the P1,700 you paid this guy for registering the company. You should first write this guy a letter giving him 14 days to pay you a full refund of the P1,700 he owes you. Say in the letter that you’ll take legal action against him if he fails to do so. If he doesn’t cooperate after 14 days then go to the Small Claims Court and ask for an order against him.

The bad news? I think you might have left it way too long to worry about the money you paid him for the plot. You’ll need to check this with an attorney but I suspect that the Prescriptions Act will apply. That says that a debt like this one is “prescribed” after three years. In other words if you fail to start legal action within that period then a court will refuse to consider the case. You might need to write that one off.

One final point. Why on earth did you approach someone who had already cheated you to set up your company for you? That should have been a warning sign. If someone cheats you once, they’ll do it again if they get the chance.

Can I get my money back as well?
I was getting married last year November, as is the norm my name was published at the DC's office. After a few days I and my husband received short message from someone was asking us to hire his photography services on our day, we discussed the issue with my husband and agreed to engage him. We then made an appointment with him and met near KB mall in Gaborone. We gave him the whole amount of P3,000 for the service, and have a receipt to that effect. On our wedding day he came as agreed, he shot the video and took photos, on the second day he informed us he won't make it but sent someone who did not disappoint.

Then time for giving the videos and photos came, he promised to deliver in 7 days, that did not happen, we continued calling him and he made endless promises, until last week when my husband asked him should we now take the legal route and his answer was yes you can. I thought he was just joking but it seems he was serious since its been a week now without any word from him. Can consumer watchdog help me get my money back because our initial agreement with this man did not materialize? I thought of reporting to the police but I feared that he may change his cellphone number once he realises that I was serious about engaging the law since the only detail I have is his cellphone number.

Yet again someone has been badly let down by a wedding service supplier. What is it with that industry? Why is it so populated by liars and crooks? Why do some of them operate like drug dealers?

You should do what I suggested the other reader should do. Write a letter giving the guy 14 days to refund you completely and warning him that you’ll take legal action against him. Then make sure that you follow through and go to the Small Claims Court.

Every week we have at least one person with a story similar to yours. Sometimes it’s a photographer, other times the caterers or suppliers of furniture or equipment but the story is always the same. On what is meant to be someone’s most special day they are let down, often ruining the occasion.

My advice is simple. Only ever use someone at your wedding who you already know is reliable and honest. Only use someone who has satisfied someone you know at their wedding. Using a stranger is clearly far too risky.

Saturday 6 February 2016

MMM Global is a scam

We still haven’t learned our lesson about scams.

Despite our history of TVI Express, Success University, Karatbars, WorldVentures and, above all, Eurextrade, people in Botswana are still falling victim to pyramid and Ponzi schemes.

You’d think that after Eurxtrade in particular, when so many of our friends, family, colleagues and neighbours lost so much money, some of them even being ruined financially, that we would have been better able to resist the lies of the scammers who run these schemes. You’d think, wouldn’t you, that people would now know that the sort of claims made by the Eurextrade peddlers, of profits of “up to 2.9% daily”, are impossible. You’d think that people would know that investments typically grow slowly and steadily if you’re lucky and that enormous growth is a myth.

Well, you’d think so.

But it isn’t so.

Just this week someone alerted me to a new scheme that is doing its best to steal our money. This one is called MMM Global. Their web site makes some very grand claims about how you can make money just by joining "a community of ordinary people, selflessly helping each other".

This is how they describe themselves:
"MMM is a mutual fund exchange network where people provide financial help directly to each other in automated Private Offices via the internet. You Provide Help to someone else (donate) then get rewarded with 30% every month on the amount you Provide Help with (donate). You then get an opportunity to Get Help (withdraw your funds) you have Provided Help. The Power of Giving lets you receive in 23 times more than you gave to others in a year!!!"
I’m not sure about you but that makes absolutely no sense to me. People offer each other money but somehow you get 30% interest and your money can be multiplied “23 times”? Does that make any sense to you?

Here is a time for an old rule. If it seems to good to be true then it certainly IS too good to be true. MMM Global shows all the signs.

I texted someone involved in the scheme asking them where the money came from and within moments I was brought into a WhatsApp group chat with over 100 other proponents of the scheme as well as victims. One of the advocates of the scheme explained it this way:
"Your Rands are converted to MAVRO when you request to Provide Help, so the growth rate is generated by the system on your MAVROS. MAVRO is a help index which grows by 30% per month, named by famous Sergey Mavrodi, founder of the MMM Community. 1 MAVRO = 1 Rand."
So this guy Mavrodi has invented a new currency that magically increases in value by 30% every month? I asked how and things got even more complicated. Nobody could explain where this 30% came from. I asked several times if it came from investments or simply came from the contributions made by new people joining the scheme but all I got was more gibberish. Then something curious happened. Various members of the group, who it later emerged were new recruits, said a few interesting things that I think showed the truth about this scheme. One said “When more people join it means more money in the pool.” Another said, trying to explain the source of the money, said that it came from “the money flowing in”.

That’s when the more senior members of the scheme became VERY angry, shutting down the comments from the newcomers but still not explaining where those 30% per month profits come from. Nor could they explain the suggestion that you get take out 23 times more than you put in.

Clearly this is a Ponzi scheme, no different to other schemes like Eurextrade. The money that some people receive is just coming from the money paid by later joiners. There are no profits at all, just money flowing from one victim to another and a crook running the whole operation somewhere.

And there certainly is a crook here. Remember what I was told about the “famous Sergey Mavrodi, founder of the MMM Community”? He is indeed famous. But not for inventing a new currency.

His page on Wikipedia describes him as “a Russian criminal and a former deputy of the State Duma. He is the founder of the МММ series of pyramid schemes. In 2007 Sergei Mavrodi was found guilty in a Russian court of defrauding 10,000 investors out of 110 million rubles ($4.3 million).”

Of course just because someone was previously convicted of running a scam and defrauding thousands of people of their life savings, that doesn’t mean he’s doing it now. Maybe he’s a reformed character. Maybe he’s now a good guy.

Yes, maybe but almost certainly not. Would you lend money to someone who stole from your distant cousins in the past? Would you take that risk? You’d be mad to do so.

The good news is that there has been some action in South Africa to put an end to the abuse MMM offers its victims. Capitec Bank have recently started freezing bank accounts they suspect are being used in the scam apparently with the cooperation of the South African National Consumer Commission and the Reserve Bank. Maybe the authorities should consider doing so here as well?

They certainly need to. The MMM South African “Changing the World Team” are currently advertising a function on the 20th February at Yarona Country Lodge in Mogoditshane where I’m sure they’ll be doing their best to persuade people of the riches that can be made by joining the scheme.

Do you think they’ll be mentioning the mysterious source of the promised profits or the criminal past of its founder?

The Voice - Consumer's Voice

How do I get my refund?

I entered into a contract with a company to provide me with a wedding tent for my wedding on 19th and 26th December 2015. I paid them P12,500 and P6,500 for the two occasions. Unfortunately the company failed to provide the service for the first event only providing the tent and chairs with no items listed on the contract and catered for 150 guests instead of the 200 guests that we paid for. The lady who is managing the company switched off the phone as from the 18th December and only came to apologise to us on the 20th December with no explanation as to why she did not provide us with the service we requested.

We entered into an agreement (written and signed) to the effect that she will refund us part of the fees we paid for due to her failure to provide the service. She paid an amount of P5,500 and as per our agreement the contract to provide service at the second event was cancelled forthwith and she promised to refund the deposit of P6,500 to be paid before the 31st December. The lady started to ignore my calls when I tried to inquire about my refund and when I finally contacted her she requested for 10 days to look for money which I did approve. After 10 days (which elapsed on the 18th January) the lady started to ignore my calls and my efforts to send her numerous messages to request my refund proved futile up to now.

I have given up on her and I am thinking of seeking legal action against her. Please assist me on what to do to get my refund back. I have a proof of all the receipts for payments, the contract and Memorandum of agreement signed by me and her together with our witnesses.

I’m not sure you really need my help, do you?

You’ve already done everything I would have suggested and the only thing left is to follow through with your threat to take her to court. You’re lucky that the amount in question is well within the limits of the Small Claims Court. I suggest you go to them as soon as you can, show them all the paperwork you have and seek an order from them for the outstanding money she owes you.

Meanwhile again I have to ask the same question that I ask so often. What is it with the wedding industry? Why is it so full of crooks and incompetents? Why do they not seem to care about their customers’ special days?

Is this a real job?

I was in contact with a woman from the USA who I met in Mozambique at a meeting last year. Then I hinted I was looking for job and she indicated she will assist. In January 2016, I received an email, supposedly from her saying I should email my CV to her and the HR office of Valero Energy Corporation. I did that and someone from supposedly Varelo sent an Employment Application form which I completed on 28th January. The next day I received a letter of offer from supposedly Valero.

My sixth sense then indicated all is not rosy, as this might be a scam, but it does not follow the description of scams. My suspicion is based on the following. First the names of the people I dealt with kept changing. I was offered a post of Assistant General Manager initially but upon offer I am offered one of a Project General Manager. The last straw was I am to pay a visa of US$550, where I suspect the catch is. The agent given is a Norman Weed. I did speak to him and he sounded elderly, he claimed to have received a copy of my appointment from Valero.

Please help me verify.

Your suspicions are 100% correct. This is undoubtedly a recruitment scam. There is no job here, no offer, no magnificent salary. The only genuine thing is the money they want you to send them.

You’ve mentioned some of the clues, but there’s another big clue that this isn’t a genuine job offer.

Real companies offer real jobs to real candidates only after they’ve done a real face-to-face interview. These days you can do interviews online using technologies like Skype but there is always, ALWAYS some form of face-to-face interview before someone is offered a real, senior-level job. Always.

And companies don’t ever charge their recruits to be hired. Even if they did they wouldn’t demand that the money was paid using money transfer services like in the demand you sent me. There’s one last clue. Valero, a real oil company have posted a warning on their web site saying all of this as well. Just delete the emails and don’t ever respond to them, no matter what these crooks do to entice you.