Floral Investment collapses, makes away with investors’ funds

For many people who have invested Floral Investment, the chicken might just have come home to roast. Owners of the scheme in far away Dubai have shut them out.

Apparently, Floral Investment, a Ponzi scheme disguised as a flower trading company with investment opportunities has eventually collapsed. However, just as most Ponzi schemes do, they never admit the obvious.

With so many red flags all over its claims, Floral Investment was one of the most promoted Ponzi schemes that made use of conventional and non-conventional digital marketing tools to rake in many deposits. The scheme floated its office in far away Abuja, Nigeria’s administrative capital with zero pedigree as a hub for investment and shallow financial market activities.

Investors cry out for help

In the last three weeks, PageOne.ng Bad Market Desk (our beat covering dodgy investments schemes) has been inundated with a barrage of phone calls, emails and text messages from investors who have lost various sums of money.

One of the investors who is now a victim of Floral Investment wrote to PageOne.ng crying out for his funds to be released to him. His appeals to Floral Investment fell on deaf ears. In in concise note, James Wike (not real names) and my username is ‘jameswike (redacted), with the Floral Investment account number: 0042770711, said he has been unable to get his money from the scheme.

“I join flora investments through onlinenaira cos of exchange issue on the date of 17-o3-2017 and I deposit the sum of 135,125 naira with floral investment.

“No body introduced me to floral I discover floral investment myself and been washing their videos although and was convinced that this is a good business to invest on and I when and borrowed some money from my friend to return back to him after 2month with interest”.

“The scheme promised to pay back about 77000 naira in Nigerian money every month”.

“They also promised that after a 12 months duration, I can take back my capital and re-invest if I will still want to invest and also that I can double up my investment if I want to”.

“I have sent some of the information that there used to tell me, one of them is the issue of hacked on their system and the was able (sic) to get back their system up to 80 percent of their loss”.

The promise to pay back after the ‘cooked up’ hacking story was not fulfilled, it turned out that Floral Investment is no longer replying to any message from James and thousands of investors who have stakes various sums of money into the scheme.

One of the message James received from the scheme was the usual scam excuse issued to tell investors they have lost all their monies. See below:

Dear investor!

Your payment was delayed due to the company’s transition to new banking software.

We apologize for waiting.

All payments will be made on May 16, 2017.

Best regards, Floral Investment Ltd.

The last message from the scheme was more disturbing and an insult to the collective intelligence of Floral Investment’s investors:

Dear Clients!

We apologize for the delay in payments!

The company will resume operations from July 15, 2017 in Nigeria, after the opening of the office in the city of Lagos.

Regards!

Best regards, Floral Investment LTD.

Why Floral Investment was always a scam
From the get go when Floral Investment carried out a massive campaign using some of Nigeria’s largest blogs and news websites, PageOne.ng’s Bad Market unit had written a review that Floral Investment is a scam and a disaster waiting to happen to its investors and affiliates.

The promoters described the scheme as Trade and Investment Company “FLORAL INVESTMENT is a unique platform for those who want to invest in flower business and raise money with us. You can become a part of our team right now from the comfort of your home”.

For a first timer on the website, you will find it very enticing to want invest in Floral investment because of the convincing materials on the site and various testimonials about the company.

Globally, Flowers are in high demand across America and European markets for social uses, household decorations and other uses, but the 120% RoI is too bogus for a company that invests in such business to promise.

However, investors who are overwhelmed by the ‘world class’ posture are likely oblivious to the very volatile nature of the flower market and how just one weather event can lead to massive losses to farmers and traders who have taken various bets on the prices of flowers in the international markets.

The promissory message on the website reads ‘Invest in flowers it is very profitable, we can guarantee the investors a 120% in a month. We do not sell virtual assets like forex, binary options. All funds are invested in real goods which selling all over the world.Annual sales of flowers reaches € 7.45 bln.An opportunity to enter into futures contracts for purchase of flowers attracts many buyers and sellers on the stock exchange, thus increasing the volume of trade transactions and stimulate the market. This market is not affected by the fall in energy prices, and the financial crisis!’.

There are empirical evidence about the business model of Floral Investments but there are many red flags about the same business model, its returns on investment promise and its opaque structure on how it arrived at its calculations.

We had predicted that Floral Investment will in medium and short term fail on its promised returns. The company was basically a pyramid scheme and the flower business is a mere cover up. Funds used to pay old investors are gotten from new investors.

Many investors and prospects of Floral Investment are oblivious to the fact that they can not withdraw their principal amount “It is impossible to withdraw the principal”

That part is hidden on the website and the caveat is not clearly displayed which makes the scheme a deceptive one.

There is no guarantee Floral Investment will open any office in Lagos. Its office in Abuja has since been vacated and the scheme can no longer be reached physically. For those who did not fall victim to this scheme, it is very instructive that you stay away from investment programmes that sound ‘too good to be true’.