ONLINE INVESTMENT PROGRAMS AND ITS IMPACT ON THE WELL BEING OF UNIVERSITY OF BENIN STUDENTS(A CASE STUDY OF MMM)

CHAPTER ONE

INTRODUCTION

BACKGROUND OF THE STUDY

Online investment programs have recently in Nigeria become a household name and very popular among the youths. it can simply be defined as the process of pledging a certain amount online to assist a person or group of people with the sole aim of getting back the amount invested with some amount of interest. The increase of these online investment programs has been unprecedented as even the Nigerian government has taken note as a result of its popularity. Good examples of these online investment programs include MMM, get help world wide, ultimate cycler and a host of others evident in Nigeria today.

It is obvious that many Nigerians are getting aware of these current Pyramid scheme trending in Nigeria the most popular being the MMM Nigeria (http://www.nigeria-) which promises 30% Return on Investment(ROI) after 30 days.

The online investment scheme are a fraudulent investment operation where the operator, an individual or organization, pays returns to its investors from new capital paid to the operators by new investors, rather than from profit earned through legitimate sources. Operators of online investment schemes like MMM Nigeria usually entice new investors by offering higher returns than other investments, in the form of short-term returns that are either abnormally high or unusually consistent.

Initially the promoters of these online investment schemes will pay out high returns to attract more investors, and to lure current investors into putting in additional money. Other investors begin to participate, leading to a cascade effect. The “return” to the initial investors is paid out of the investments of new entrants, and not out of profits. Often the high returns encourage investors to leave their money in the scheme, with the result that the promoter does not have to pay out very much to investors; he simply has to send them statements showing how much they have earned. This maintains the deception that the scheme is an investment with high returns.

1.2. STATEMENT OF THE GENERAL PROBLEM

The current wave of popularity generated by these investment programs among Nigerian and especially youths has been a cause for a serious concern. The increase in the participants has prompted the Nigerian government to look into their operations solely for the fear of scamming the public.

Recently, the Nigerian government via  the Securities and Exchange Commission (SEC), warned the  public on the activities of some online investment scheme currently making waves most notably the  ‘MMM Federal Republic of Nigeria. MMM Nigeria was launched in 2016 primarily targeting the Nigerian audience.

According to SEC, the promoters of the scheme carry out their business activities via Nigeria.mmm.net portal/platform, and are promising investors a monthly investment return of 30 per cent.

1.3. AIMS AND OBJECTIVES OF THE STUDY

The major aim of the study is to examine the impact of online investment programs on the well being of the university of Benin students. Other specific objectives of the study are as follows:

1. To determine the legitimacy of these online investment programs.
2. To determine if students feel comfortable investing in such online investment programs.
3. To determine the relationship between the well being of students and the growth and expansion of these online investment programs.
4. To know if investing into these online investment programs influences students’ financial status.

1.4. RESEARCH QUESTIONS

1. What is the impact of online investment programs on the well being of the university of Benin students?
2. What is the legitimacy of these online investment programs?
3. Do students feel comfortable investing in such online investment programs?
4. What is the relationship between the well being of students and the growth and expansion of these online investment programs?
5. Does investing into these online investment programs influences students’ financial status?

1.5. RESEARCH HYPOTHESIS

H0: There is no significant relation between the well being of students and online investment programs in Nigeria

H1: There is a significant relation between the well being of students and online investment programs in Nigeria

1.6. SIGNIFICANCE OF THE STUDY

The findings from the study would be immense importance to Nigerian youths and most importantly to undergraduate students and students of other tertiary institutions who are confused of the online investment programs in Nigeria and their roles. The study would also benefit researchers and scholars who are interested in the subject matter for developing further studies on online investment programs in Nigeria.

1.7. SCOPE AND LIMITATION OF THE STUDY

The study is restricted to the impact of online investment programs and its impact on the well being of the university of Benin students.

Financial constraint: Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview)

Time constraint: The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.