Loom investors complain as the Ponzi scheme shows signs of distress

A few weeks after it took over the social media, targeting young Nigerians to take part in a pyramid scheme, Loom, a Ponzi scheme has slowed down, as fewer individuals are now reported to be investing in it.

Probably gaining lessons from the bitter experience millions of Nigerians had when another Ponzi scheme, MMM, collapsed in 2016, different Loom groups have recently become inactive.

Loom was truly anticipated to last for a short time, like every Ponzi scheme.

Some Nigerians have begun to complain about the slow rate the system is going at.

“Progress isn’t encouraging at all, I won’t put my money back once I cash out in this round,” said Rose, a telephone outlet attendant, interviewed previously by a reporter.

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Rose said, “No fresh individual has joined the group for the last week.”

“People are scared it might crash quickly, so once they collect their, nobody’s going to market for the group again.”

According to her, she has so far “cashed-out” N88,000 with the N11,000 she ‘ spent. ‘ She said she placed three times in N2000 to get N16,000 each and also invested N1000 in five slots to get N8000 each.

Femi Smart, another investor, said, “Loom is a teamwork, if everyone works, we’ll all get our money, and if we don’t invite people, then the system will go off.”

Mr Smart, who also confirmed the scheme’s slow pace, said, “Because of what occurred with MMM, everyone is cautious to invest.”

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Rabi Yusuf, a hairstylist, said she believed she lost her money because she couldn’t persuade anyone to join her group.

“Since last week, I’ve paid 2k to someone’s account, I haven’t heard of it since I’m not on WhatsApp. She’ll tell me to look for someone to join the group whenever I call so I can get my cash quickly.”

Ms Yusuf said without any gain she wouldn’t mind getting her funds back.

The Securities and Exchange Commission (SEC) had advised Nigerians against Loom Ponzi’s system, just as it did during the disgraceful MMM period, stating it’s ‘ a looming risk. ‘

According to the SEC’s Acting Director-General, Mary Uduk, an inter-agency commission, the Coordinating Committee for Financial Services Regulation (FSRCC) is working with safety organizations to monitor and shut down the group.

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“We would therefore like to notify the investing public that there is no concrete business model in the operation of this investment system, hence it is a Ponzi scheme where returns are paid from the invested amounts of other nations. Also, the Commission does not register its operation,” she said.

What progress the committee has made ‘ in monitoring the scheme’s masterminds ‘ is not evident.

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