In the Charles Dick­ens 1844 nov­el’ Mar­tin Chuz­zle­wit, ‘Tigg Mon­tague start­ed a Com­pa­ny, which pays off ear­ly pol­i­cy­hold­ers’ claims with pre­mi­ums from more re­cent pol­i­cy­hold­ers.

It was here a clas­si­cal ponzi scheme was first de­scribed. A pyra­mid scheme re­cruits mem­bers via a promise of pay­ments for en­rolling oth­ers in­to the scheme.

A Ponzi scheme promis­es re­turns on “in­vest­ments,” but which are ac­tu­al­ly paid for by new in­vestors.

NIS re­flects this.

Mon­ey from new in­vestors (tax­pay­er) is used as pay­out to old­er in­vestors (re­tirees).

With the in­creas­ing el­der­ly pop­u­la­tion and de­cline in younger work­force this pro­gram now has ma­jor chal­lenges.

At the be­gin­ning of this month per­sons rushed to re­ceive ‘bless­ings ‘or dou­ble re­turns on their in­vest­ments ,if they brought in two oth­er mem­bers in the “Bless­ings Over­flow” pyra­mid group. This crashed, leav­ing many per­sons in tur­moil.

Fail­ure of pyra­mid schemes caused ri­ot­ing and un­rest in 1997 in Al­ba­nia, and in the town of Lucea in Ja­maica , four po­lice of­fi­cers had to be hos­pi­talised and five po­lice ve­hi­cles were dam­aged in 2001.

Four days ago per­sons threat­ened to march to the po­lice sta­tion to re­cov­er $22mil­lion which po­lice seized from the Drug Sou Sou scheme in La Hor­quet­ta.

The po­lice re­turned the mon­ey? Was it due to a fear of ri­ot­ing? A le­gal mis­step in seizure?

Gary Grif­fith and the pub­lic are wait­ing for some an­swers.

Would the pas­tor who had some mon­ey seized with the de­mon­e­ti­za­tion of the hun­dred dol­lar bill now ex­pect sim­i­lar treat­ment ?In Ju­ly this year in the U.S. Dis­trict Court for the Dis­trict of Co­lum­bia, pros­e­cu­tors had to ap­proach the court to get for­mal own­er­ship of $6.5 mil­lion as­sets seized in the “Ba­nana Fund” cryp­tocur­ren­cy Ponzi scheme.

Yes there fraud­sters who must be pun­ished but one must dis­tin­guish be­tween the sou sou and ponzi /pyra­mid schemes.

Soy Sou ,part­ner (Ja­maica )or paluwa­gan (Philip­pines )has been a help to the poor who find them­selves shut out of the tra­di­tion­al fi­nan­cial in­sti­tu­tions.

Some peo­ple were able to build a house, start a busi­ness, and get out of eco­nom­ic op­pres­sion.

With the Covid eco­nom­ic down­turn, sou sou may be a sav­iour to some.

The lure of quick rich­es, a jump start of your dreams and greed were some of the same rea­sons per­sons in­vest­ed in CL Fi­nan­cial.

Per­sons took a risk go­ing af­ter 8 to 13 per cent in­ter­est rates.

In 2011, the then At­tor­ney Gen­er­al Anand Ram­lo­gan said CLI­CO had been op­er­at­ing an ‘elab­o­rate Ponzi scheme’. ‘The in­ter­ven­tion by the au­thor­i­ties com­ing down un­der sec­tion 44D in Jan­u­ary 2009 was too late.

There was over­sight and gov­er­nance fail­ure across the board, and ques­tions must be asked of the reg­u­la­tors, au­di­tors, ex­ec­u­tives and, of course, the pre­vi­ous ad­min­is­tra­tion un­der whom this all un­rav­elled.

The then Prime Min­is­ter Kam­la Per­sad-Bisses­sar said “Do you re­mem­ber the pyra­mid? Now we are hear­ing about Ponzi schemes and so on. This here was the CL scheme, and what it was re­al­ly is to take peo­ple’s mon­ey in non tra­di­tion­al in­vest­ments, push it out there in very risky in­vest­ments to try to get a very high rate of re­turn and, of course, like a pack of cards, it col­lapsed.”

$24 bil­lion of tax­pay­ers mon­ey were spent to bail out the CL Fi­nan­cial group ,rev­enue that could have been used to in­crease the salaries of pub­lic ser­vants, fix roads, hos­pi­tals, buy med­i­cine etc.

Some ar­gue that the gov­ern­ment had no choice be­cause of the size of the com­pa­ny in re­la­tion to the na­tion­al econ­o­my, oth­ers spec­u­late that the deal struck was a re­sult of the re­la­tion­ship of key mem­bers of CLI­CO’s man­age­ment with both the gov­ern­ment and op­po­si­tion mem­bers.

In ‘Ponz­i­mo­ni­um’-How scam artist are rip­ping off Amer­i­ca, au­thor Bart Chilton stat­ed.

“In many coun­tries there is a no­table ab­sence of po­lit­i­cal and pop­u­lar sup­port for reg­u­la­to­ry ac­tions to close down Ponzis be­cause of the care­ful­ly craft­ed pub­lic per­sona of the scheme-op­er­a­tors. Reg­u­la­tors in de­vel­op­ing coun­tries are fur­ther con­strained by a lack of the req­ui­site tools, re­sources and some­times po­lit­i­cal in­de­pen­dence to cope with such schemes.”

Bernie Mad­off in the USA with his 64 bil­lion Ponzi scheme and Allen Stan­ford who used mil­lions of US dol­lars of de­pos­i­tors’ mon­ey to dra­mat­i­cal­ly trans­form T20 crick­et are both serv­ing prison sen­tences.

With the CL Fi­nan­cial col­lapse in 2008 , I am still wait­ing to see some of the main play­ers an­swer to us.

Jus­tice must be dis­pensed equal­ly, the wealthy and the pow­er­ful can­not be seen to es­cape while 9 per­sons who were charged in La Hor­quet­ta take a fall.