MOSCOW: Sergei Mavrodi, a businessman who founded a notorious Ponzi scheme in the 1990s, smiles after being set free from prison in this file photo.—AP
MOSCOW: Sergei Mavrodi, a businessman who founded a notorious Ponzi scheme in the 1990s, smiles after being set free from prison in this file photo.—AP

MOSCOW: Sergei Mavrodi, an eccentric Russian mathematician who founded the notorious MMM pyramid or Ponzi scheme in the early 1990s that swindled millions out of their savings, has died, his assistant said on Monday.

Mavrodi, whose bespectacled face once featured on vouchers issued by the grandiose scheme, died at age 62, his assistant Alexander Vlasov told Moskva news agency.

The fraudster was found unconscious at a public transport stop, Interfax news agency reported, citing a source.

A mathematician who became one of the earliest computer programmers, Mavrodi first went into business selling pirated videos and CDs. He founded a company called MMMM that initially imported office equipment. He then gave up trading and founded the financial pyramid of the same name that became the largest in Russia.

Lured by a catchy television advertising campaign, an estimated 10 to 15 million people invested and received vouchers that promised a huge return.

Mavrodi became “one of the most recognised personalities” in the country’s popular culture, Rossiiskaya Gazeta state newspaper wrote.

Fresh out of the Soviet Union, Russians generally had little financial knowledge and were naive.

“Mavrodi’s success came from the fact that such types of swindles were a novelty in Russia at the time, plus this was accompanied by a really mass-market and quite cleverly made advertising campaign,” economist Sergei Khestanov told Sputnik radio station.

Mavrodi was elected as a national MP in 1994 — giving him immunity from prosecution as he faced tax evasion charges — although he never turned up to parliament.

Published in Dawn, March 27th, 2018

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