Inside Ecoplexus and its promises of quick returns
Sihlobo Nyoni | Monday May 15, 2023 06:00
According to every website about Ecoplexus, it is a "leader in the development, design, engineering, construction, financing, operations and ownership of renewable energy systems for the commercial, government, and utility markets".
Ecoplexus members presented me with information that their company operates physical power stations where users can rent solar generators via an app to earn daily income from electricity production. When renting a generator, Ecoplexus links your account to a corresponding device at their solar farm. To receive the amount of power your generator produces, you must indicate that it is "working" by clicking the working button on the app each day. Ecoplexus is said to then convert all generated electricity at a rate of 1KW:1BWP and sells it to the global market at a higher price. Additionally, the company recycles all of the electricity produced.
However, this is just a facade for the actual Ponzi scheme that lies underneath. The scheme is said to be divided into levels, with each level representing a different piece of equipment.
In Botswana, where the scheme appears to be gaining traction, there are currently six levels, named PV0 to PV5. The levels are differentiated by the amount of investment; PV0 requires an investment of P40 and would generate a daily income of P2; PV1 requires an investment of P230 and will generate P7 daily; PV2 requires P750 investment and would, in turn, give P25 each day; PV3 – P3,000 investment generating P110 each day; PV4 – P10 000 generating P380 daily and lastly PV5 requires an investment of P26,000 and would give a staggering return of P1,100 each day.
According to a member of the scheme who tried to recruit me, “PV6 is on the way,” with a smile on their face as if they were already profiting from the scheme.
The rate of return at these levels is extremely high, with the potential to make one's problems disappear almost instantly. PV0 has a rate of return of 150% per 30-day investment cycle, PV1 – 91%, PV2 – 100%, PV3 – 110%, PV 4 – 114%, and PV5 – 127%. These returns are too good to be true and should be a red flag for anyone considering investing in this scheme.
A Ponzi scheme typically begins with a person or group promising high returns to investors in a short period. To attract more investors, the scheme's organisers often use aggressive marketing tactics and promise unrealistically high returns.
Initially, the scheme may pay out the returns as promised, using the money invested by newer investors to pay off the earlier investors. This creates a false sense of security and attracts more investors to invest in the scheme. However, as the number of investors grows, it becomes difficult to maintain the promised returns, and eventually, the scheme collapses when there are not enough new investors to pay off the returns promised to earlier investors.
At this point, the organisers may disappear with the remaining funds, leaving the investors with little to no recourse for recovering their money. Ponzi schemes are illegal and can result in significant financial losses for investors who fall prey to them.
To make matters worse, the Ecoplexus scheme is now being promoted on TikTok with flashy videos showcasing the supposed success of investors. All of these videos seem to be a little over a month old or less. This could mean the scheme is fairly new or could also mean that the scheme is running out of new investors to bring in and is now resorting to social media promotion to keep the illusion of success alive.
Ponzi schemes have been around for decades, and yet people still fall for them. The promise of high returns with little effort is too tempting for some, but the reality is that these schemes always collapse in the end, leaving most investors with nothing. The same will likely happen with Ecoplexus.
In conclusion, if someone approaches you with an investment opportunity that sounds too good to be true, it probably is. Don't fall for the empty promises of Ponzi schemes like Ecoplexus, and always do your due diligence before investing your hard-earned money.
*Sihlobo Nyoni, Faculty of Commerce, Department of Accounting and Finance, BA ISAGO University