Probably, many of our compatriots remember the financial pyramid of JSC MMM. Her dazzling rise and crushing fall did not leave anyone indifferent. Some people went crazy and laid hands on themselves, while others, rejoicing at their foresight, only laughed at those who wanted to get rich, without making the slightest effort. But the modern generation has already begun to forget about the most grandiose scam in Russia. Therefore, recall the story of "MMM" will not be amiss.
Foundation of the company
Few people know that initially the company was registered as a trade cooperative. Yes, in 1989, when the USSR still existed, the MMM joint-stock company specialized specifically in trade. First of all, it was such a scarce commodity as computers and components.
However, pretty quickly the direction changed. The company traded everything that promised quick profits: office equipment, advertising, equipment, exchange activities, even beauty contests. Also, the legal address of MMM was often changed. First, the office was located on Gazgoldernaya Street, then on Varshavskoye Shosse, then on Bolshaya Pirogova.
However, there were many such companies in a very difficult time for the country and people. Most of them, after working for several months, simply broke up. And today, few can remember their existence. However, MMM took a completely different path.
origin of name
Few people know that the name was formed from the first letters of the names of the creators of the pyramid "MMM". These included Sergey Mavrodi, his brother Vyacheslav Mavrodi and Olga Melnikova. However, as Sergey Mavrodi subsequently claimed, the latter participated in the process only nominally. It was just that several founders were required to register a company, which is why they were invited to sign and officially become co-founders. They did not participate in the further activities of the company.
Pyramid creation
But quite quickly, the main founder of the company realized that in ordinary trading it would not be possible to get rich quickly and fabulously. Then it occurred to him to create something new, which did not yet exist in the post-Soviet space. And so begins the story of the first pyramid - "MMM".
The transformation from a trading company to an investment one took place on October 20, 1992.
In early 1993, the first emission prospectus was registered. As a result, the company received the right to issue 991 thousand shares. In fact, it is from this that the story of Mavrodi's MMM begins. Good advertising and well-thought-out marketing support did the trick - stocks began to sell out very quickly. Moreover, their value grew every day.
As a result, after a few months, Mavrodi applied for a new batch of shares - now for a billion copies. Such permission was not issued to him, so he limited himself to another 991 thousand shares. They also left like hot cakes. An incredible crowd was going on at the points of sale. People borrowed money from friends and relatives, sold property in order to purchase shares promising fabulous money. Well, like any other pyramid in history, MMM was in better times. But such prosperity simply could not be long.
Pyramid principle
Many people bought stocks, hoping to soon receive huge profits, without thinking at all how the MMM pyramid worked.
In fact, the principle of operation is as simple as possible. The holder of the stock could always profitably sell it only because they kept growing steadily (remember the “tulip fever” in the seventeenth century in Holland). Over the month, the value of the stock doubled approximately.
In other words, during this time, the number of investors (or at least sold shares) quadrupled. Thus, the new generation of holders of securities significantly outnumbered the previous one. This made it possible to maintain the company's prestige and even redeem shares from holders at a significantly increased price. However, who could have thought of selling stocks that increase in price by 200 percent in one month? Of course, most people preferred to hold securities in their hands, waiting for them to rise just to fabulous heights.
However, even under ideal conditions, the existence of a pyramid is possible only as long as each subsequent generation of investors is several times greater than the previous one. Here everything is like with an ordinary pyramid. But what will happen if, at least for several generations, the number of investors remains the same or, moreover, begins to decrease? The answer is simple. The pyramid will collapse. This is very well shown in the documentary "MMM" - the history of ingenious deception ", which was released in September 2012.
Stunning profits
The profits of the founders and investors themselves grew rapidly. As mentioned above, over the month, stocks doubled in price. Well, in total, during the existence of the company (from January 1993 to August 1994, that is, a year and a half), the cost increased 127 times. The number of investors was measured in millions.
Mavrodi himself also did not stay away from profit. According to some reports, his daily income was about $ 50 million.
Everything went relatively smoothly until July 27, 1994. It was then that the creator of the MMM pyramid Sergey Mavrodi announced a reduction in the value of shares to their original face value, that is, 127 times, to one thousand rubles. At the same time, he promised that now the growth rate will increase significantly and amount to about 400 percent per month.
Activity of the company
You should not think that the MMM company worked only in one direction. A huge amount of money, which even had nowhere to invest, required them to be invested in at least something.
So, the company invested in various television programs: “Under the Sign of the Zodiac”, “Contacts, Contacts”, “Last Squeak”. With the money of depositors, a video was shot for the song of the group "Zero" called "Going, smoking." The company also released the film "Gongofer."
On May 17, 1994, MMM became the general sponsor of the match between Spartak and Parma. Football player Fyodor Cherenkov, for whom this match was farewell, received a gorgeous Mitsubishi Pajero car as a gift. The company also acted as a sponsor at City Day in the capital of Russia.
Many Muscovites remembered charity events when a wealthy company entered into a contract with the leadership of the Moscow Metro, so that city residents could ride it for free.
Well-known advertising
Of course, telling briefly the history of "MMM", one can not help but mention the chic marketing campaign, which in many respects ensured high popularity.
By far, the most recognizable advertising character was Lenya Golubkov, an ordinary Russian who always lacks money devoured by wild inflation. By investing the last 50 thousand in MMM shares, in a month he receives enough profit to buy boots for his wife. After another month, there is enough money for a fur coat. This is followed by furniture, a car and even a house in Paris.
The commercials were, on the one hand, very short (15-30 seconds each), but they came out in sequential series, creating something like a mini-series consisting of 43 commercials. Of course, Leni's experiences were close to many potential investors. This clung to them, forcing them to take their last savings to the cashier of MMM JSC, hoping to increase this money. Over time, in the videos, except for Leni Golubkov, his wife, brother, acquaintances of different ages began to appear, from newlyweds to pensioners.
Well, the video, which simply shocked the minds of investors, was shot with the involvement of the famous Mexican actress Victoria Ruffo. Yes, the very one who played the main role in the super popular in the 1990s series “Just Maria”. Of course, the participation of the famous actress in advertising was the reason why many people, already prepared by previous videos and public opinion, could not stand it and invested in the pyramid.
The collapse of the pyramid
The history of "MMM" in 1994 ended. More precisely, on August 4. It was then that Sergei Mavrodi was arrested for tax evasion. According to experts, over the years the company has existed, it has underpaid about 50 billion rubles to the budget.
The assault on his apartment was broadcast live on television. Of course, right after that, the stock price collapsed to zero.
The pyramid, as expected, collapsed. Well, the arrest of its founder only served as a catalyst. Perhaps if this did not happen, the number of shareholders would increase further, and the “bubble explosion” would be even louder.
Number of victims
Today it is difficult to say exactly how many people were holders of MMM. Securities, not to mention tickets (a cheaper analogue) were bought without registration, their owners were not kept records, and they were freely transferred from person to person. Therefore, the investigation officially stated that the number of deceived exceeded 10 thousand people. According to other sources, this number exceeded 10 million people.
Moreover, when the bubble under the loud name "MMM" burst, many people lost everything. After all, in the pursuit of easy money, they invested not only personal savings, but also borrowed from relatives (or persuaded them to also join in a profitable business), sold apartments, cars and everything that had at least some value. As a result, about fifty people committed suicide in various ways, without suffering the loss of everything - from accumulations to trust from loved ones.
The fate of Sergei Mavrodi
Of course, the fate of Sergei Mavrodi, the main founder of the pyramid, is of most interest.
After the crash of MMM, he hid for five years from law enforcement officials, without even leaving Moscow. In 2003, he appeared in court. The process lasted more than four years - all this time Mavrodi was in the “Sailor silence”. The case has accumulated 610 volumes.
But the term of the founder was very modest - 4.5 years. Since he spent four years in prison, a month later he was released.
Followers of "MMM"
Of course, the success of the pyramid, which enriched the owner, made him one of the richest people in Russia in a matter of months, could not leave indifferent other lovers to cash in at the expense of others.
Quite quickly, a huge number of other pyramids were registered in the country. According to experts, their number is close to two thousand. The most famous were Tibet, Russian House of the Selenga, Khoper-Invest, Telemarket, Rosich and many others.
By popularity, they could not be compared with "MMM". However, people suffered from their activities - from hundreds of thousands to millions. The amount of stolen money was measured from billions to trillions of rubles.
"MMM" in the XXI century
Having been released, Sergey Mavrodi did not remain in the shade for long. Already in 2011, he launched a new pyramid - "MMM-2011". Now he deciphered the name as "We can do a lot." A year later, the company was reorganized into MMM-2012. And in 2014, she turned into "MMM-Global." The scheme of work remained the same - investors who had arrived earlier received profit from the proceeds from the new shareholders. At the same time, Mavrodi openly stated in his own blog that companies are pyramids, they can collapse at any time without returning money. However, people still took off their savings and bought stocks, hoping to get serious profits.
In 2015, Mavrodi announced the closure of the company, stating that any branches and centers that continue to operate are fraudulent.
Today, branches exist in different countries of the world - not only in Russia, Belarus, Ukraine and Kazakhstan, but also in China, Japan, the USA, Peru, Ghana, South Africa and others. Now the remuneration was promised more modest - from 10 to 40 percent per month. The founders relied on fast-growing bitcoins.
In 2017, many branches were closed. Investors were promised to return the money along with the accumulated interest. However, the final payment date remains open and constantly pushed back. It is easy to assume that these investors also fell victim to cunning manipulators who rely on human greed and stupidity.
Conclusion
On this our article comes to an end. Now you know what the essence of the MMM pyramid is. And at the same time they learned about the history of its creation, development and sunset. Let's hope that the readers can see the essence of the financial pyramid, which has ruined millions of people only in our country, and they will try to stay away from extremely profitable and attractive offers.