The Financial Expert Who Was Swindled By a Rogue

The Financial Expert Who Was Swindled By a Rogue

Ah, you warned me and I didn’t listen. I thought I would cash out before they abscond!

That was the lamentation of Confidence, my good friend after losing a huge sum of money recently in a ponzi scheme called FoxBet. You may find it hard to believe that a financial expert with years of experience could be easily defrauded by a group of rogues having less of his experience but smarter. As it’s said in Africa, a dog that’s destined to stray will not heed the hunter’s whistle. However, I must admit that no matter how smart and careful we are, we sometimes fall victims.

It all started four days back when I received an urgent call from Confidence asking me to lend him some money. The amount was considerable that I had to query the purpose and when I should get back my money. He narrated how one of his colleagues invested the sum of N100k and cashed out N140k within two days. Incredulous! I exclaimed. What’s the name of the organization and what are they into? I asked.

They’re into football betting. This is a sure bet! They know people who know some players. They agree with them to commit fouls and get yellow carded during matches. The odds are certain, he explained excitedly. I counseled him that this sounds too good to be true. I cannot gamble my money away. He was desperate that he even offered me 50% of the gain if it comes out fine, if not, he will only return my capital. It was then I reminded him of Murphy’s Law which says, “Anything that can go wrong will go wrong.” I also went further to quote the 4th and 5th Laws of Gold according to the Richest Man in Babylon.

The Fourth Law of Gold
Guard thy treasure from loss: Every owner of gold is tempted by opportunities where it would seem that he could make large sums by his investment in most plausible projects. Often friends and relations are eagerly entering such investment and urge him to follow.

The Fifth Law of Gold
Gold flees the man who will trust it to impossible earnings or who follow the alluring advice of tricksters and schemers, or trust it to his own inexperience and romantic desires in investment.

Using these financial principles, I deduced the Wealth Creation Curve, WCC. With the aid of the following graphs we will see how the odds were against my friend.


Definition of Terms
R = Returns, profit, commission, interest, etc.
T = Time
a = Risk factor
& (flattened) = Infinity

WCC = Wealth Creation Curve
BB = Backward Bending
Downstream = Low networth
Upstream = High networth

Normal Case
Consider Figure 1, as an investor you must start from the downstream at point a to earn r1 after doing time t1. To earn r2 upstream at point b, you must do time t2.

Abnormal Case
From Figure2, you create a Backward Bending Wealth Creation Curve when you try to earn r2 at t1, that is, point c. As you force the WCC backwards, you increase your risk to the point where a = R. This is the point you risk losing all your investment.

“The game is so arranged that it will always favor the keeper. It’s his business at which he plans take a liberal profit for himself from the coins bet by the players. Few players realize how certain are the game keepers profit and how uncertain are their own chances.

Despite the obvious red flag of FoxBet not using the formal financial channel of transaction preferring to deal in cash, Confidence was only true to the meaning of his name, albeit for the wrong reason. I will drop my pen with the last quote from the book.

“Wealth that comes quickly goeth the same way. Wealth that stayeth to give enjoyment and satisfaction to its owner comes gradually, because it’s a child born of knowledge and persistent purpose.”

Be vigilant!

Share this post

Post Comment