CROWD 1 and AIM Global became the latest establishments to cause uproar among Kenyans on social media after it emerged that the two pyramid schemes, among others in the country are driving Kenyans to the point of suicide.
A video that went viral on social media platforms on Tuesday August 4 shows a past session attended by scores of people, with a man well dressed in a suit showing the guests how to make money quickly.
The man appeared to be first giving an insight to his audience what a typical Kenyan goes through while on a payroll, not having much money to save for himself in the long run.
Pyramid schemes have become more common in recent times and have multiplied ten fold owing to the coronavirus outbreak. But why are they a scam?
These schemes come in form of several sites that have recently surfaced over the internet and still exist that claim to be certified and have the capacity to earn an individual a whooping Ksh 5,000 up to Ksh 10,000 daily!
For anyone to start earning this amount, one needs to deposit a certain amount of money into the company’s account, afterwhich they have to refer people to their websites, and these invited people have to pay an amount as well for you to earn a certain percentage from what they have deposited.
Therefore the more people you can convince to join your network the more you earn.
What most people don’t know is that earlier investors get to be paid by money deposited by later investors and before the later investors earn their money back plus their interest the network stops remitting any cash to the detriment of later investors.
To verify this, the investors post evidence of their earnings on social media via their M-PESA messages from their purported online jobs with their profile pictures photoshopped onto luxurious cars and mansions not forgetting their incessant messages in people’s WhatsApp inbox.
254News.co.ke ‘s very own Content Writer Marvin Chege discussed his near death experience with these pyramid schemes.
“The first time I was invited by a friend at campus of an opportunity to make a lot of money in a week. Since I was curious, I wanted to find out more and I was led to a seminar by a company known as Global Internet Fortunes (GIF). I paid about Ksh200 at the entrance and I sat there for hours listening to a guy in a screamingly sharp suit talking us through what the scheme was about.” he revealed.
He went on to add that he saw the chance as a good idea to finally make money for his blog, and on hearing the charge for registration which was Ksh5,000, he sought help from his friend.
A spot check from his friends working at the ICT field revealed that what he was nearly footing the bill for was a scam that threatened to swindle him from his hard-earned money. He has stayed away from pyramid schemes ever since.
“If it seems too easy, then you’re doing it wrong” he commented when solicited for advice for those wanting to get into pyramid schemes.
“To get what you want, you must work for it. There are no shortcuts. What these guys at the pyramid schemes are trying to do is to con you, at least the modern way, using the internet. They want to make themselves rich quickly at your expense.” he signed off.
CROWD 1 has been deemed a scam in its own right, and journalist Chris Sambu offered a depth into how it functions in a series of tweets he posted.
“If anything requires an “upfront investment” to sell – it means the actual product is not strong enough to sell itself.You’re paying to become a sales person? You’re only paying so the person above you in the pyramid can get paid!” he began.
“They don’t actually sell any digital products, they market them. What actually are you marketing? When you dig deeper, two sites come up: AffilGo (online gambling) and Miggster (mobile gaming).
So far they have no physical headquarters, a dude who owns all the affiliate sites & no actual product. If there is no product, you ARE the product.
With Crowd1 you can buy packages. A package is essentially a place in the pyramid. More expensive package, higher up you go.
If it’s so amazing, why do you have Crowd1 people phoning you up asking you to join? Simple – if you don’t join, they can’t make money. You have to move up the pyramid. Every time you recruit someone, you’re essentially building out the base of the pyramid larger.” he added.
He went on to reveal how CROWD 1 doesn’t have a product but it is merely a scam. At the moment, it is being investigated for securities fraud in Norway.
The scheme is banned in Namibia and in the Philippines and can earn one 21 yrs in jail.
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