The notion and signs of financial pyramids. Criminal liability for financial pyramids

The phrase "financial pyramid" became the embodiment of deception and fraud. However, even today such a method of building a business continues to be used all over the world. Entrepreneurs come up with all the new ways, and this phenomenon is not going to disappear. What are the signs of financial pyramids? What is their essence? Let's consider more in detail

The mechanism of the pyramids

Building a business in the form of a pyramid involves involving more and more broad layers of investors who ensure the stability and profitability of the system. The scheme of the financial pyramid is quite simple: new investors ensure the return on investments of previous investors. The higher the level of entry, the greater the probability of making a profit. Almost no chances to get money from those who are at the bottom of the pyramid, and, as is obvious, the majority. The greatest profit is extracted by the one who stands on top, and possibly near the top. Pyramid investment is not always a fraudulent scheme, but it is always vulnerable. Even a small malfunction in the system can lead to its collapse. Most often, collapse occurs when one or more large investors want to withdraw investments.

There are several approaches to assessing the nature of pyramid financial structures: first, such enterprises may have different organizational and legal forms; secondly, they are a growing system of debt obligations; the longer a firm can survive, the more it accumulates debts; Thirdly, the pyramid can be considered as a kind of fraud, although there are some cases when such designs were created for good purposes. But always they are a means of rapid enrichment, so they bring questions to the representatives of the law.

The main features of financial pyramids

Speaking about the pyramidal business, it should be noted that it can be very diverse, and it's very difficult to recognize a scam immediately. The first important sign of financial pyramids is the absence of authorized capital. All payments of dividends are due to attracting new investors. This type of business is highly risky for all participants, except for the organizers, but it is very tempting for investors, since the creators of such schemes always guarantee a quick and high income. Guarantees are the leading sign, as there are always risks for legitimate financial schemes, so they do not give guarantees. Typically, such organizations do not have any licenses for financial transactions. They offer for sale are not the usual financial products, but some of their own inventions: shares, loan agreements. Also a sign of the pyramid scheme is the clause in the contract that in case of the collapse of the firm the depositor receives nothing and has no right to file a claim. There are also signs of financial pyramids related to promotion: they are always very active, even sometimes aggressively advertised; A lot of time and effort organizers give PR actions. To hide the lack of real investment or production activities, the organizers use a lot of special vocabulary in their speech, they create the illusion of thorough thoughtfulness and validity of the scheme. Any attempts to go deeper into the study of the company's work features a statement about a commercial secret. Investors are organized into a kind of community of like-minded people, the participants of the scheme are motivated to involve new players. For this they are often offered additional bonuses, most often in the form of an additional share in business - in the form of a block of shares for example.

Varieties of financial pyramids

There are several attempts to classify pyramidal financial constructions. These schemes are constantly being improved and modernized, so it is unlikely that it will be possible to cover all species within a single typology.

By the way business is organized, it is possible to single out "clean" pyramids, which do not conduct any activity at all, except registration of participants and fundraising, and "camouflaged" for a wide variety of businesses: funds, clubs, networks. It is also possible to divide such companies according to the stated purpose of fundraising: some offer earnings and involve people with promised profits, others work under the guise of investment projects, mutual aid clubs. Some are disguised as companies selling some goods or services (most often in them the Forex market appears). There are pyramids that mimic for social enterprises or non-profit foundations.

Today, it is often possible to meet organizations that represent themselves as consumer cooperatives or alternative programs to official mortgage and loan enterprises. Today almost every day there is a new pyramid, and for their multiplication the Internet gives great opportunities. This allows you to divide these schemes into online and offline designs. It is also possible to divide the pyramids by deliberately harming citizens: there are companies that are initially created with fraudulent intentions, and there are large investment projects that were thought of as a real business, but as a result of mistakes and errors turned into pyramids. Often the latter lead to the emergence of financial "bubbles" - an unreasonably high flow of investment in the project, which can provoke a loss of control and the destruction of the company.

A special category is the official pyramid system, which is supported by the state, for example, this is how pension funds are structured in many states. Current pensioners receive benefits from contributions of future disabled citizens. Despite the fact that the leaders of the countries talk about various investments of pension funds, but often they are almost none, since the pension load in developed countries is getting higher: the life expectancy is growing, the number of able-bodied population is decreasing, therefore there is simply nothing to invest in pension funds, and there are significant Risks of collapse of these schemes.

Advertising and promotion

Important signs of financial pyramids - this is a special advertising activity. These firms need a very rapid growth in deposits, so that people do not have time to start demanding dividends, and at the same time, that a large amount of funds is quickly formed. These goals serve as a massive advertising of financial pyramids, which has its own specifics. Such advertising campaigns appeal to a person's emotions; They try to lull his rational part and call for an action, without hesitation. Advertising communications are usually built around a person, often attracted stars and authoritative personalities. It is very rare to learn the real leaders of the pyramid. All messages are built on the infinite motivation of the consumer: he is told how he can do anything without doing anything, and get an unclear explanation. The goal of advertising is to push to an immediate, irrational action, and it works as a disabling critical thinking mechanism. Due to obsession, aggressive demonstration of close success and simplicity and the story that many have already achieved success, and you may not be in time, there is an excessive demand.

A lot of attention in such organizations is paid to PR-actions: they always have excellent presentations, impressive publications in the media. Communications are often built around some kind of brand-character, which is called to inspire trust.

World experience

Our financial pyramids of the 1990s, of course, were not a new invention. The global economy has already been repeatedly shaken by the loud collapse of companies and the ruin of citizens. The first in the history of the creator of the financial pyramid is Charles Ponzi, today his name has become a household name and is the designation of such schemes. He in 1919, he came up with a scheme for the exchange of international exchange of coupons, which was supposed to bring huge profits. He managed to find several investors, who Ponzi promised 45% of the profit in just 3 months. He was not going to conduct any exchanges of coupons, especially since they could not be exchanged for money, but only for postage stamps. But the scheme has worked, investors simply did not bother to get into the essence of the offer and began to bring money. Ponzi began paying the first depositors - and this spurred the excitement, money flowed the river. The publication in the newspaper in which the journalist considered that the coupons bought on the invested money should be several times greater than it is physically possible brought down the pyramid. Investors rushed for money, the company stopped operations. On the accounts of Ponzi, money was found that was shared between the victims. They managed to return about 40% of their investments, and this was not the worst scenario for the development of events in history.

After that, the world of finance knew many more pyramidal schemes. The most famous of them were the schemes of Lou Perlman, the international bank of Stanford, the companies L & G and Yingkou Donghua Trading, the ant farms of W. Feng and many others.

One of the largest pyramid-long-liver created in the US B. Madoff. His company was considered a successful investment project, it brought money very well-known people and many large banks of the world. For 20 years, Madoff was able to balance, issuing interest through the constant attraction of investment. Everything ended unexpectedly, after the sons of the financier told about the essence of their father's enterprise. In a private conversation, he told them about the secret of his success, and they informed him on the police. Madoff had been under investigation for a long time, and at the age of 71 he was sentenced to 150 years imprisonment.

The Russian history of the pyramids

The founder of pyramidal constructions in Russia was Mavrodi Sergey Panteleevich. In tsarist Russia there were insignificant financial pyramids in the form of mutual support counters and mythical investment projects, however they did not reach a large scale. In the USSR, there was no possibility of private investment, and therefore there could be no question of such scams. The financial pyramids in Russia blossomed during the perestroika period. People were thirsty for earnings, and the stream of scammers did not fail to take advantage of it.

The most famous and large pyramids, except MMM, were the companies "Khoper-Invest", "Vlastilina", "Chara-bank", the bank "Russian House of Selenga", "Tibet". Tens of millions of citizens have suffered from their activities. They had trillions of rubles withdrawn, which never returned in any amount. The experience of the 1990s with the loud collapse of the pyramids, legal proceedings and the search for perpetrators all over the world for some time reduced the growth of such schemes. But since 2010 a new turn in the history of the pyramids, which flourish thanks to the Internet and the invention of entrepreneurs.

MMM

In 1992, Mavrodi Sergey Panteleevich and his brother and wife set up companies. MMM, which sold its own shares and tickets, guaranteed income up to 200% per month. The company itself set the price for shares, they did not start in any free circulation. The shareholders did not receive any financial documents confirming the purchase. The shareholder could sell the company's shares and make a profit. The main essence of financial pyramids is attraction of depositors, and MMM successfully used this mechanism. The population at this time was catastrophically financially illiterate and very trusting, and this was what Mavrodi played. For two years the company flourished and prospered, some investors managed to gain income and thereby contributed to the popularity of the company. MMM was creative about advertising: mini-series about Lenya Golubkov and his family became a real motivating film for ordinary people, and the phrase: "I'm not a freeloader, I'm a partner" went to the people. In 1994, MMM appeared to complain about non-payment of taxes, but Mavrodi denied these charges. All this provoked panic among depositors, the shareholders' landslide appeal for money begins. In 1997, MMM was declared bankrupt, and the creator of the pyramid was accused of fraud. In total, almost 15 million people were affected by MMM, but only 10,000 were officially recognized as victims. The damage is estimated at 3 billion rubles.

New opportunities

The advent of the Internet has led to a new round of development of the pyramidal type of business. The reason that the financial pyramids on the Internet have become so popular is the opportunity for creators to remain anonymous. The Web has many tools for transferring money, which are poorly monitored by regulatory bodies. This is what scammers use. The most common variant of financial schemes on the Internet is HYIPs. These investment programs with very high risks are now being offered on the Internet to invest in some profitable programs. But in reality, profit comes from attracting new players. Organizers of the pyramids on the Internet claim that there is no risk in their schemes, since the number of potential participants is still very high. But this argument does not work, because any information guide can provoke panic and collapse of the pyramid. Also in the network today you can meet and traditional models of the pyramids, they are called scams (from the word deception). Such an investment pyramid is designed for the credulity of people who do not check anything and transfer money. There are models that masquerade as games, which provide for the sale of some attributes of the game. Scammers every day launch all new projects on the network and almost always go unpunished.

The most famous financial pyramids on the Internet

The most famous Internet pyramids today are the games "Seven Wallets", NewPro and MoneyTrain, the virtual stock exchange "Stock Generation", organized by the notorious S. Mavrodi, Perfect Money and Liberty Reserve payment systems, the investment pyramid WholeWorld and many others.

Network business and pyramids

Frightened inhabitants do not just want to invest money, so the pyramids began to be conspiratorial for the network business, which, although not very positive, is also available to a number of people who are ready to invest in it. There are many similarities between the pyramids and networks, but there are also differences. To distinguish a fraudulent scheme from a real business, it is worthwhile to understand what is the difference between them. MLM-business always sells a real product. He can be of different qualities, but still he always finds a buyer. It does not require too much entry fee. Can offer to buy a starter package of products - then its price should be reasonable and usually preferential for beginners. The network company has a real address, without any problems showing the constituent documents, usually does not hide its first persons. The income in the MLM business depends on the efforts and activity of the seller in sales, and not only on the number of people involved.

Precautions

In order not to get hooked to scammers, it is worth remembering simple precautions. One should not succumb to promises of guaranteed income, in the modern world of finance there can be no guarantees. When you join an affiliate program, you need to estimate the amount of deductions "upward". In trade companies, it does not exceed 5%, but if they promise to deduct 10% or more, this should alert. Wherever you take money, you need to carefully check the constituent documents, address and contacts of the company. It should be remembered that reviews on the Internet can be moderated and managed by the owners of the pyramid, so do not blindly trust them.

A responsibility

If a person has a question: how to create a financial pyramid? Then he can recommend the following: to think about responsibility for their actions, and only after that to proceed to action.

In all countries of the world they are struggling with financial fraud with different success. In Russia, criminal liability for financial pyramids is provided. Amendments to the legislation have come a long way and only in 2016 they were finally signed by the president of the Russian Federation. The main punishment for the creators of this type of business is fines. If you raise more than 1.5 million rubles, the fine will be 1 million. If the pyramid is larger than 6 million, then the recovery will be more - 1.5 million rubles, as well as forced labor and even imprisonment. The difficulty of attracting scammers to responsibility is that the law on financial pyramids names only the following 5 types of pyramids:

1. Those who do not hide their essence (as it was with the MMM).

2. Companies that appear as a legitimate alternative to mortgage and consumer borrowing.

3. Firms that are conspired against pawnshops, microfinance and credit organizations.

4. Companies that require large incoming fees in the guise of insurance, refinancing, debt settlement services to various borrowers.

5. Organizations that impersonate players in the financial market, in particular participants in the Forex currency market. And this list does not exhaust all the diversity of companies that operate on the principle of pyramids.