Loom Ponzi scheme gains popularity, many to lose money

Less than two years after MMM Ponzi scheme collapsed, Loom, another scheme with the same character and intent has gained popularity.

It is a popular baloney that is gaining massive interest among mostly youngsters, students and low-wage employees.

Just a typical Ponzi scheme, promoters of Loom are using instant gratification unique selling proposition as well a pyramid formula to suck in victims into the scheme.

On the surface, it is marketed as a business/investment opportunity where an investor can multiply their capital by more 300% to 1000% within few hours. Most of its promoters claim it is a unique business opportunity for investors to multiply their money.

But the frenzy will soon be short-lived as Ponzi schemes eventually collapse once new investors dry out.

In 2016, Nigeria was the hotbed of Ponzi schemes in the middle of the first recession in more than 20 years. Millions of Nigerians and Africans lost billions of dollars to MMM and a host of other Ponzi schemes that collapsed there after.

Further investigations by PageOne’s team shows that Loom is on a global rampage to defraud many young people who are either impressionable or less savvy about money.

UK’s Daily Mail said in a report that Loom is a new ‘dangerous’ money-making scam taking over the internet, targeting young people on social media.

The medium reported that the ‘Loom’ craze has resurfaced on Facebook and promises people a payment of $2400, eight times the initial $300 entry fee, when their friends and family join.

Many Nigerians have already lost millions of Naira to the scheme with daily videos and complaints from victims who lost money to the scam.

Why are we warning people about Loom Ponzi scheme? Because we understand the Ponzi scheme underbelly more than anyone else in our industry. In 2016, we did a detailed news article warning Nigerians/Africans on the eventual collapse of MMM and myriads of copycat schemes that overran various societies.

You have heard of the saying ‘if it walks like a duck, quack like a duck, it is a duck’.