Many of us who utilize email and social media are familiar with the annoyances of chain letters. Using strategies of guilt, fear or promises of reward, chain letters encourage persons to copy its messages to a number of others. Chain letters usually die with me, but I know of many who take them quite seriously. This is not necessarily a bad thing, as they are for the most part harmless. But as the economy continues to spiral downwards, many are now employing chain letter-type pyramid schemes to swindle persons out of their money. Many countries, including Guyana have had to issue warnings to their citizens about the dangers of falling for these schemes, yet they persist and keep popping up in different forms.
It is not surprising that these pyramid schemes are expanding during a time where large portions of our population have lost their source of income or face the anxiety of losing it in the near future. Many are desperate for some sense of economic security, even if it means putting themselves at risk. After all, no investment is risk free and the alluring promises made by these schemes causes many to focus only on what they can possibly gain.
The organizers of these schemes propose them as being a “type of Sou-Sou.” Those who are familiar with actual Sou-Sou’s know that the promises sold by the scheme are not real. Sou-Sou’s are a savings-loan mechanism that is rooted in African culture. There is no profit to be earned; they are not a get rich scheme. What you put in is what you get out.
There is no requirement to recruit members to join a Sou-Sou in order to get paid. In the Blessings Circle corruption of it, those who have just entered at the bottom of the pyramid are usually the ones who lose out on their money. The pyramid’s foundation is based on a constant stream of new members contributing towards its maintenance. Sou-Sou’s on the other hand utilize a trust system. Hence it is normally done between families, friends or colleagues. Each person gets a turn to receive a loan or save money before the cycle refreshes again.
Sou-Sou’s have been very popular in our culture, particularly amongst Black women for whom the informal loan-savings mechanism is the only one that is available to them. The many requirements needed to access bank credit and loans are often too restrictive. Even amongst non-Black populations, persons throw box-hand in order to pay for vacations, homes, food, outstanding expenses or just to treat themselves to something nice when their turn comes around.
The pyramid schemes that come under various names such as Blessings circle, Blessings Loom and Giving Circle etc. have been around for a while and periodically pop up. Potential participants hoping to earn extra cash are required to pay an entrance fee into the scheme and are filled with false promises of quick returns on their investment. Of course, as is the case with pyramid schemes, these participants are required to bring in more people and have their people bring in people to invest.
Failing to complete this crucial part of the circle can result in one never ascending to the top of the pyramid to collect on their promised returns. I recall several occasions where I was prompted to join a “Blessings Circle.” On the first occasion, a new recruit came to me with a sense of urgency. They had a once in a lifetime opportunity that could help me escape the cages of set monthly paychecks. All I had to do was invest three hundred thousand over three months, bring in ten persons and at the end of the six-month period; I would receive a payout of one million. While arithmetic has never been a strong point of mine, these numbers just did not add up. I was instantly suspicious about who the organizers were, how long they have been around, where was the extra seven hundred thousand was coming from and how was this sustainable exactly? They could not offer any solid answers. I checked in on the progress of the circle a few weeks later and was not surprised to hear that they were experiencing issues. It was quite interesting to me that as the weeks rolled on; I got other offers to join this once in a lifetime opportunity with various amounts of buy-ins. At a certain point, it stopped being amusing.
It isn’t that people do not know that there is something inherently wrong with these schemes – the majority do – but what they are banking on is the hope that they can cash out of the scheme before it inevitably falls apart. Many are consciously involving their friends, family and colleagues to build their numbers in the hopes that they can be one of the lucky few who benefit. This says a lot not only about the state of our economy, but also about how the lure of money corrupts.
