|
Who can say no to a 4.5-percent profit a day?
Hundreds, maybe thousands of Filipinos couldn’t and put their
hard-earned money in an online investment scheme called Francswiss.
Some borrowed money in order to come up with the minimum investment
of US$1,000. Many raked in big profits. Then the Securities and
Exchange Commission issued a warning against Francswiss and similar
schemes. These are scams that use the money of subsequent investors
to pay the interest due other investors. The scheme collapses once
new investments are insufficient to pay the interest of existing
investments. “One day the site’s up and the program is paying,
but the next day you get a ‘Page Not Displayed’ error when
accessing the site and you have stopped receiving payments from
them,” www.phinoymoneytalk.com explains.
SEC refers to the scheme as a
Ponzi investment scheme, named after Charles Ponzi who, in 1919, was
jailed over what seems to be the world’s first known pyramid scam
(www.pinoymoneytalk.com). Features of Ponzi or pyramid schemes are:
a promise of huge profits at no risk, no paper trail, and no
information about the owners, office address and the like. Nowadays,
there’s simply a website.
The National Bureau of
Investigation reports that movie stars, TV personalities, OFWs and
generals were among the investors. The bureau has arrested the
“chief financial adviser” of Francswiss, a 26-year-old man from
Baguio City.
Francswiss recruited through its
website and through the promise of a 10-percent commission to
investors who could bring in two more recruits. Recruitment meetings
were done in expensive hotels all over the country, according to
www.mylot.com. Some desperate investors, knowing that a slowdown in
new investments would deprive them of profit, accused ABS-CBN of
attempting to extort from Francswiss’ founders and when the latter
refused, Francswiss was exposed. Francswiss’ website went down a
few days after ABS-CBN TV Patrol reported the scam.
Recruitment for Francswiss was
allegedly rampant among AFP personnel. One soldier told me that the
recruiters claimed that no less than the Intelligence Service of the
AFP had cleared the scheme. This source believes that Francswiss
could be linked to future destabilization efforts. According to him,
many of the Oakwood mutineers had lost substantial amounts in a
similar pyramid scam, and this was the major reason for their
joining the mutiny. They had nothing left to lose.
“Is Francswiss a scam?”
www.pinoymoneytalk.com asks in a June 22 posting, and answers “Not
yet, but it will be. Soon. Trust us. We’ve been there and done
that.” And that’s the point. We’ve seen pyramid scams before.
We’ve seen the victims who lost their lifetime savings, entire
families losing everything, including money that they had borrowed.
Investors know that there is no way that a legitimate business can
make the 4.5-percent daily interest that Francswiss promised. Yet,
the “company” raised more than P300 million. Even if the NBI
will be able to arrest and file charges against those behind
Francswiss, the investors whose investments were used to pay the
profits of the earlier investors, are unlikely to get their money
back. It probably isn’t any consolation to them, but at least they
didn’t make money at the expense of others. A pyramid investment
scheme is robbery, plain and simple.
Talking of scams, the Supreme
Court has preventively suspended four judges in Cebu pending further
investigation into their involvement in what has been dubbed “the
marriage scam.” Some judges charge a lot more than the official
P300 marriage fee. One couple—the groom a foreigner—paid about
P36,000. The couple was told that there’s an additional charge if
the marriage is solemnized outside the court, something another
judge denied. The latter also shared that a Briton paid P100,000 to
get married by the same judge. Another foreigner who was married by
this judge wouldn’t tell me how much he paid, but he said that
getting all the requirements for a marriage was so complicated that
he was only too happy to let the judge’s staff—whom he called to
ask advice—“take care of everything.” The couple got married
two days later. Now they worry if the marriage is valid considering
that the circumstances under which it was solemnized might have been
illegal. Initial findings of the Supreme Court investigation
indicate spurious documents and possibly forged signatures in
connection with some of the marriages.
|
