MMM was established in 1989 by Sergey Panteleevich Mavrodi, his brother Vyacheslav Mavrodi, and Olga Melnikova. The name of the system was taken from the first letters of the three foundersâ€™ surnames. MMM was helping people to get ride of poverty and financial slavery. Main mission of MMM was to help common people to make their life better and started its journey towards a mission and ideology which was given by Sergey Mavrodi (Russsian Mathematical Genius).
But In January 1992, tax police accused MMM of tax evasion, leading to the collapse of MMM and causing them to have difficulty obtaining financing to support its operations. Faced with difficulties in funding its foreign trade, they switched to the financial sector. It offered American stocks to Russian participants, but met with little success. Later, MMM was created for the purpose of collecting vouchers during privatization. This effort was similarly unsuccessful.
MMM created its successful system in 1994. MMM grew rapidly. In February 1994, the MMM reported dividends of 1,000%, and started an aggressive TV ad campaign. Since the shares were not quoted on any stock exchange and they itself determined the share price, it maintained a steady price growth of thousands of percent annually, leading the public to believe its shares were a safe and profitable.
An important factor in the systemâ€™s success was word of mouth, but most of their success came from its extremely aggressive ad campaign, which appealed to the general public by using â€œordinaryâ€ characters that viewers could identify with. The most famous of them, a â€œfolk heroâ€ of early 1994, was Lyonya Golubkov. Another notable marketing effort was a giveaway of free Metro trips to all Moscow citizens on a particular day. MMM also was one of the first well-known system in Russia with a logotype and slogans (â€œFlying from shadow to the lightâ€ and others).
At its peak the MMM system was taking in more than 100 billion rubles (about 50 million USD) each day from the sale of its shares to the public. Thus, the cash flow turnover at the MMM central office in Moscow was so high that it could not be estimated. The management started to count money in roomfuls (1 roomful of money, 2 roomfuls of money, etc.).
Regular publication in the media of the rising MMM share price led President Boris Yeltsin to issue a decree in June 1994 prohibiting financial institutions from publicizing their expected income.
The Success of MMM in attracting people led to the creation of other similar systems, including Tibet, Chara, Khoper-Invest, Selenga, Telemarket, and Germes. All of these companies were characterized by aggressive television advertising and extremely high promised rates of return. One system promised annual returns of 30,000%.
On July 22, 1994, the police closed the offices of MMM for tax evasion. For a few days the MMM attempted to continue the system, but soon ceased operations. At that point, Invest-Consulting, one of the companyâ€™s subsidiaries, owed more than 50 billion rubles in taxes (USD 26 million), and MMM itself owed between 100 billion and 3 trillion rubles to the participants (from USD 50 million to USD 1.5 billion). Several organisations made efforts to recover their lost money, but Sergey Mavrodi manipulated their indignation and directed it at the government. In August 1994 Mavrodi was arrested for tax evasion. However, he was soon elected to the Russian State Duma, with the support of the â€œdeceived participantsâ€. He argued that the government, not MMM, was responsible for people losing their money, and promised to initiate a pay-back program. The amount ultimately paid back was minuscule compared to the amount owed.
In October 1995, the Duma cancelled Mavrodiâ€™s right to immunity as a deputy. MMM declared bankruptcy on September 22, 1997.
While it was believed that Sergey Mavrodi left Russia and moved to the United States, it is possible that he stayed in Moscow, using his money to change apartments regularly and employ a group of former special agents. With the help of a distant relative he started Stock Generation Ltd., another system based around trading non-existent companiesâ€™ stocks in a form of the â€œstock exchange â€ on the companyâ€™s site, stockgeneration.com. Despite a bold-letter warning on the main page that the site was not a real stock exchange, between 20,000 and 275,000 people, according to various estimates, fell for the promised 200% returns and lost their money.
Mavrodi was found and arrested in 2003. While in custody, Mavrodi was given until January 31, 2006 to read the documents in his fraud case against him. Since he had already spent over four years in custody, he was released less than a month later, on May 22, 2007. Â
In 2008 Mavrodi published the book â€œTemptationâ€. In May 2008, bailiffs arrested Mavrodiâ€™s rights to this book. Seven thousand copies of the book were published. He wrote few books to tell people that current banking structure is unfair and pure Pyramid Scheme and It was well settled by Federal Reserve Bank and It was making people financial slaves.
In 2011, He thought where was his mistake as he wanted to help the poor people to fight against financial slavery. That time 1/3 population of Russia was with him for support. Â Then he came to know about ideology of MMM and he made some restrict rules in MMM.
He later went on to creating yet another revolutionary system called MMM-2011 in India called MMM-India.
In 2012, He declared MMM as a Non-profit organization, by which people can help each other to break this financial slavery and to stop AMD (American Dollar Monopoly). Then Officially, MMM was declared a Mutual Fund. It restarted successfully in many other countries also including INDIA.Â In India people understand the true ideology of MMM system and joined this revolutionary system to help people all over the world to make human life better.
Now this time, MMM is running successfully in many countries including South Africa, India, Zimbabwe, Nigeria & Many More.