Many Nigerian youths see sport betting as a means of making easy money

By YUSUF MOHAMMED

Nigerians seem to be easily attracted to Ponzi schemes under any guise basically as a result of their predisposition for quick riches. The propensity has mutated into all kinds of social behaviours in the quest for wealth. Anything that promises quick money is usually instant success; though for a while.

This explains the popularity of Yahoo-Yahoo, BBN, ritual money, sports betting. Past experiences do not matter for these addicts because there is this feeling that they could be among the lucky ones.

Most of the ponzi schemes produce many millionaires at the initial stage. All of a sudden, it crashes. And when that happens, people’s money get trapped

These schemes favour the early birds. Those who are lucky withdraw their money and re-invest in a legitimate trade. Those who are greedy reinvest in the scheme and at the end, learns the hard way.

A Ponzi scheme is a fraudulent investment or operation where the operator, an individual or organisation, pays returns to its investors from new capital paid to the operators by new investors, rather than from profit earned through legitimate sources.

A pyramid scheme is a form of fraud similar in some ways to a Ponzi scheme, relying as it does, on a mistaken belief in a nonexistent financial reality.

Operators of Ponzi schemes usually entice new investors by offering higher returns than other investments in form of short-term returns that are either abnormally high or unusually consistent.

The Chief Executive Officer, SOFUNIX Investment and Communications Limited, Mr. Sola Oni, said that people are easily lured to the scheme due to the hardship in the country.

“As the economic recession bites harder, it is easy to lure unsuspecting but gullible people to fall prey to these wonder schemes,’’ Oni said.

He said that there were two categories of investors that patronise the wonder schemes.

Oni explained that the first set were those who fall prey out of sheer ignorance and those who were taking uncalculated risk.

According to him, the desire to make abnormal profit is peculiar to the two categories. He, however, called on the relevant authorities to intensify their monitoring exercise and ensure that culprits face the wrath of the law.

“There should be more awareness creation on these schemes to prevent the innocent ones from falling victim,’’ Oni added.

Oni said that the Securities and Exchange Commission had enough rules that outlawed Ponzi Schemes.

Speaking of Ponzi schemes, what readily comes to mind is Mavrodi Mundial Moneybox MMM.  MMM was established in 1989 by Sergei Mavrodi, his brother Vyacheslav Mavrodi, and Olga Melnikova. The name of the company was taken from the first letters of the three founders’ surnames. It was a Russian company that perpetrated one of the world’s largest Ponzi schemes of all time. Nigerians were a huge part of this scheme.

It came at a time when there was economic recession, so Nigerians were looking for an easy way out of their predicament. Unfortunately it made matters worse as thousands of Nigerians lost huge sums of money invested in this scheme.

Long before MMM, there was the Wonder bank. Wonder banks and pyramid schemes have been around with us for a while, way back to the 70s. It comes in different forms and shapes. The boom and bust, disappear for a season, and then return in full force in another shape and form.

They promise mouth watering profits/interest rates beyond the range of commercial banking. People rush in, make money, the late arrivals part with their hard earned cash, the scheme collapses in a cloud of dust. The owners disappear into thin air while depositors lick their wounds.

Barely two years after the MMM experience, another Ponzi scheme called Loom was introduced to Nigerians. Many Nigerians took their chances with Loom. Unlike MMM, loom was more popular on Whatsapp. Nigerians took to the internet to market Loom for more participation, especially on WhatsApp.

The scheme which was first reported in the UK, then by an Australian media, ABC News (Australian Broadcasting Corporation) as a scam after it had gone viral in Australia, was accepted in Nigeria.

The first step of the process is being invited to join a WhatsApp group chat, usually by a friend or relative. Then you are asked to ‘invest’ N1, 000, N2, 000 or N13, 000 with a promise that you will make eight times the amount back once you recruit new entrants.

After you have paid in the money, you are asked to invite at least one person to join the system. There are four levels in Loom Nigeria – Purple, Blue, Orange and Red. Each time eight people join the person in the centre (Red) will get the target amount and leave the group.

The loom will then split into two groups. The top half and the bottom half become the new Looms and everyone moves into the next level (Purple Level – Blue Level – Orange Level) and the cycle begins all over again.

The more people you manage to add to the circle, the quicker the movement of it, and thus, the easier it will be for you to make your chunk of ‘easy money’.

Like MMM, thousands of Nigerians lost their hard earned money when it crashed.

Undeterred by the collapse of Loom, Nigerians have even become more active in sports betting, BusinessHallmark gathered.

The biting economic situation has made the Nigerian youth turn to sports betting to eke out a living. There are many sports betting companies in Nigeria, but the two most popular ones are Bet Naija and Naira bet. They are all played the same way. Betting encompasses all sports.

However since most Nigerians are more conversant with the happenings in the football world, they have chosen to play safe by choosing football.

Matthew Adeniran, a staff in one of the branches of Nairabet told BusinessHallmark that most people place their bets on football teams in the big European leagues.

“Hardly will you see anyone placing a bet on basketball, horse race, Tennis, boxing etc. A few people do though. But this thing is mainly football,” he said.

Sport betting has taken another dimension in Nigeria.  Many people have now become addicted to it. Wherever you are today in Nigeria, there are sports betting centres with different names. Apart from Bet Naija and Naira bet, there is Golden Bet, Bet King Sporty people and so on.

Adeniran added that “people win almost every day. People also lose. But the losers are far more than the winners.”

What causes addiction? Why have people become addicted to something that makes them lose money on a weekly basis? Could it be the hope of riches it offers?

Some people say poverty is a major reason why people go into it, some others disagree, arguing that rich people also indulge in it. What drives them all? Surely, the desire to make fast money is what they all have in common.

As a result of the variety of sports, there are games going on every day. As a result, each centre is always buzzing with people ready to gamble.

“I am addicted to sports bettng,” one addict who simply gave his name as Tope said. Speaking with BusinessHallmark in a Bet9ja shop at Adeniyi Jones, Ikeja, he said “I just can’t do without it. It has become a part of me. I went into it because I don’t have job. If I had something doing, I would have still gone into it for the fun of it because I love football and really know about it. But my situation today is that my life depends on it.”

Asked about the risk involved, he replied, “Like every business in life there are ups and downs. You win some and you lose some. In my own case I have won more than I have lost because I play wisely,” he boasted.

Tope is not alone in this regard. Solomon Ekanem also shares the same view. According to the 27 year old graduate who is unapologetic, betting has become a means of livelihood. Speaking with BusinessHallmark he made it clear that, “This is how I survive. I thank God for sports betting. Without it, I am sure many people would have turned to crime for survival. Why don’t we look at the brighter side of it instead of bringing out the negative aspect of it?”

As for Jacob, another young man who lives on Oyero Street, Adeniyi Jones in Ikeja, who angrily expressed that he has not won anything since he got himself involved in gambling. “I have not won anything. I have been playing for five months. I believe my luck will shine one day,” said he.

When asked how much he has lost, he said, “I have lost close to N25, 000 naira altogether. That is despite the fact that I don’t stake big money. The highest I play for a ticket is N200. There are others who place bets of over N1, 000 for a ticket and end up losing. Some even place bets of N10, 000. It all depends on the size of your pocket and how brave you are.

“Considering the amount I have lost so far, I can’t just stop without getting something back. I’ll stop even if I get half of my money back. I just have to win something.”

Lolade, who works at Nairabet in Ikeja told BusinessHallmark, “That is what most of them say. They say they will quit once they win something. Winning and losing is almost the same thing. The more you win, the more you want to play. Likewise losing, the more you lose, the more you want to play, hoping to win someday.”

She continued, “That is how the addiction comes in. It is addictive.” When asked if it is limited to the poor or unemployed, she said, “No! The big boys also play. There are many well to do people in the society who love football and want to try their luck. A few of them come here; while most of them place their bet with their phones.

“As long as it makes feel happy I don’t have any problem. I play with my money and not anyone’s money,” Taiwo Oluwole said.

He continued “Hope is what keeps me going. I am buying hope with my money. Anyone who is hopeless is almost a dead man in life. I will continue to play with the hope of winning. The hope of making it big through sports bets keeps me going.”

Just like Oluwole said, Odera Okezie a psychologist told BusinessHallmark that “the hope of becoming rich is one of the reasons people fall for these schemes.

He said, “People need to understand that making money through Ponzi schemes or gambling cannot be sustained. A man who makes let’s say one million naira from betting would feel he stands a chance to make more via that same means. Therefore, he will reinvest and may lose all his money. Most of them don’t invest in legitimate business because they feel they can make it easily the way they made it the first time. But it is easy come easy go!

“Those who run these businesses are simply taking advantage of the poor economy. If people are gainfully employed and are able to cater for themselves and family, they would not be trying their luck with sports betting or any of these Ponzi schemes. The lure for quick riches should be discouraged by everyone. All hands must be on deck.”

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