A senior Russian Finance Ministry official blasted on Tuesday a pyramid scheme proposed by convicted conman Sergei Mavrodi.
Between 2 and 5 million people lost around a total of $1.5 billion when Mavrodi's MMM pyramid scheme collapsed in 1997. The scheme promised spectacular returns in an aggressive advertising campaign on national television.
Mavrodi, who was recently released from jail after serving a four-and-a-half-year sentence for fraud, said the new MMM-2011 project called "We Can Do A Lot" started on January 11.
"Sergei Mavrodi describes a classical financial pyramid scheme with a little twist - he plans to use the Internet to keep track of its participants and carry out the transfer of the money through a system of electronic payments," said Sergei Barsukov, head of the department for financial policies at the Finance Ministry.
"It is clear that it is another of his cynical lies," Barsukov said.
Mavrodi promises that his new investors will receive 20% profit per month, while pensioners and disabled persons will get 30%. He proposes that investors to open dollar accounts in electronic payment systems, such as the WebMoney, and buy virtual tickets.
The founder of the new scheme calls his project a "financial social network" and claims that this system is "absolutely invulnerable, unsinkable and indestructible." He hopes to attract 100,000 investors this year and up to 1 million in 2012.
Barsukov, however, insisted that the participants are unlikely to receive any guaranteed returns on their investments, and will certainly have to pay taxes on any amount of gains received through the scheme.
Tax authorities will be able to track money transfers over the Internet, and will prosecute the organizers of the scheme for fraud, the official said.
The WebMoney online payment system has already announced that the company will make every effort to prevent the illegal use of its e-wallets by Mavrodi and his accomplices.
"Always remember who Sergei Mavrodi is. There will be no miracles. We've been there before," Barsukov warned.
Mavrodi was on the run until his arrest in Moscow in 2003. He served his four-and-a-half-year sentence in Matrosskaya Tishina Penitentiary and was released in May 2007.
In 2008, the courts released 18 million rubles belonging to Mavrodi. The money was shared among investors.
Moscow, January 11 (RIA Novosti)
