From time to time it is instructive to go back and take a look at signals and warnings that had been given before and which, if they had been heeded, would have saved so many from falling into traps such as the one being publicly exposed by the authorities about the Super Cash Back Gold schemes.
The writer of this column has already alluded, in a previous article, to how the persistence of a suave agent was fended off by seeking the right guidance from someone in the know. The thousands of others who did not take the trouble to double-check on the soundness of schemes proposed, which depended on the credibility of the BAI – allegedly already then in question following the crash of a company in the Carribbean –, are now paying a heavy price for having yielded to the offer of higher than ordinary market interest rates.
For those who invested up to Rs 500,000, they are lucky that they will recover their capital – but are still losers for not being able to obtain any interest. Those in the Super Cash Gold scheme will, unfortunately, recover their capital only partially in the first instance, and will have to make do with debentures spread over a period of five years for the balance of their capital contribution. And of course, similarly, with no interest.
And that’s what brings us to the saying of the French writer Alexandre Dumas fils who as far back a the nineteenth century had stated a truism: ‘Les affaires? C’est simple, c’est l’argent des autres!’ The full force of this reality is now being violently felt. There was some premonition many years earlier: the MCB-NPF affair. But with the media having to displace information rapidly and replace headlines with more newsy items to satisfy public appetite, the MCB-NPF scandal was quickly forgotten. However, it was nowhere near the alleged colossal billions of the present scam. As far as money goes, ‘hundreds’ and ‘thousands’ seem to no longer count: it seems that only millions and billions matter – not one’s own, but the millions and billions of others!
In April 2013, this column, under the title ‘Ponzi banks?’ had written that ‘The several Ponzi schemes that have exploded on the world scene in the past few years have all had machiavellic individuals as their originators. To all intents and purposes, they were highly intelligent, successful and extremely presentable gentlemen who seemed to enjoy the respect of their peers and society at large, in which they moved seamlessly, with practically all doors open to them. Until the crashes came, no one in their entourage, let alone their unsuspecting clientele – who soon enough became victims – had any inkling about what was going on behind the scene, namely the workings of the wily cook-ups that were in fact a time-bomb ticking down to D-day!’
In the early stages of the current BAI affair, Finance Minister Vishnu Lutchmeenaraidoo did not mince his words in the National Assembly, as he referred to the scheme as one ‘well-planned by crooks’ to defraud unsuspecting customers. And that was even before the magnitude of the scam was aired out in public, which its said subsequent unfolding and ramifications have confirmed. ‘If only…’, thousands of credulous customers must now be regretting!
In that column, information was also given about the Ponzi scheme as follows: ‘Carlo Pietro Giovanni Guglielmo Tebaldo Ponzi, (March 3, 1882 – January 18, 1949), commonly known as Charles Ponzi, was an Italian businessman and con artist in the U.S. and Canada. Charles Ponzi promised clients a 50% profit within 45 days, or 100% profit within 90 days…In reality, Ponzi was paying early investors using the investments of later investors. This type of scheme is now known as a ‘Ponzi scheme’.
Rings a bell now? The money of earlier investors kept being siphoned away to other companies and locations, in disregard of financial regulations that placed a limit of 10% that could be used to support other companies of a group, and that too in favour of companies that were making a loss – partly because of the humongous ‘management fees’ that were going to the owners.
Attention was also drawn to the fact that ‘Ponzi hired agents and paid them generous commissions’ and ‘investors were being paid impressive rates, encouraging others to invest.’ He soon began to roll in money, ‘started to live luxuriously,’ and ‘maintained accounts in several banks.’
Sounds very familiar now isn’t it? Add Cayman islands and Bahamas to complete the present picture.
The column concluded: ‘It would therefore seem that people must also be cautioned about Ponzi banks, and be very careful to read and study in between the lines and scrutinise the small print before they decide to place their hard-earned moneys where the attractive terms may turn out to be more of a trap… there are unscrupulous schemers hiding behind decent-looking facades who are out to dig as much as possible into the pockets of unsuspecting les autres.’
And clearly warned: ‘Just beware of any proposal, whether from bank or individual, that smells strongly of Ponzi!”
* * *
What future for Labour?
We will reproduce some extracts from an article titled ‘Discours (hypothétique) du Premier ministre de l’Avenir’, published in May 2010. They speak for themselves.
‘Après avoir nommé ses ministres, le Premier ministre de l’Avenir s’adresse à ces derniers et les autres élus de sa formation comme suit :
‘…il n’y a que 25 postes ministériels, et qu’en tant que leader, la tâche qui m’incombait a nécessité que je prenne en considération – que je pèse dans la balance, en fait – plusieurs éléments, tous plus disparates et plus compliqués, les uns les autres.
‘J’y suis enfin parvenu tenant en compte les secteurs à promouvoir et conscient surtout de certaines contraintes par rapport aux compétences requises et aussi de compléments d’information que je détenais. Mais mon souci suprême a été l’intérêt du peuple qui nous a élu, et je voudrais bien que vous aussi vous gardiez ce fait constamment en mémoire.
‘Il faut que l’équité, la justice sociale, la justice tout court en somme, prime dans vos décisions. Je puis vous assurer que je vais être vigilant à cet égard, vu la très grande charge qui m’a été confiée par le peuple pour la troisième fois.
‘Ils ont droit à cette attente de la part de leur Premier ministre.
‘J’attends donc à ce …que vous vous comporterez d’une telle façon qui fasse honneur à l’Assemblée nationale et qui rejaillira sur le pays car… souvenez-vous, l’exemple doit toujours venir d’en haut. Et nous sommes, Messieurs Dames, dois-je vous le souligner, supposes être au sommet. Méritons donc que nous soyons apprécies comme des symboles de rigueur et de hauteur.
‘… j’insiste que vous n’oubliiez pas que vous n’avez pas été élus uniquement pour défendre les seuls intérêts de vos partisans: vous êtes les représentants de tous les Mauriciens indistinctement, tout comme je suis le Premier ministre de tous les Mauriciens.
‘Je vous demande de reléguer à la poubelle toute velléité de partisanerie et d’œuvrer dans un esprit de solidarité nationale.
‘Par ces temps où l’information circule librement et il y a une méfiance de tout ce qui est gouvernement, le public doit avoir confiance que les décisions seront prises en se basant sur des critères objectifs et transparents, et en respectant strictement les provisions de la loi.
‘Afin d’accomplir votre mission et répondre aux attentes de la population, armez-vous des valeurs humaines universelles.
‘Assurez-vous de ne pas la démériter aux yeux du peuple.’
* Published in print edition on 8 May 2015