DARRYN BOODAN-editorial-pic

When I was 12 years old, my cousin gave me a copy of a book called Chariots of the Gods written by a German named Erich Von Daniken.

In his book, Von Daniken proposed the remarkable claim that the pyramids of Egypt were not built by the Egyptians but, rather, by aliens. This made complete sense to me at the time. After all, how could the pyramids, architectural wonders which would require incredible feats of engineering even today, possibly have been built by humans 2,000 years ago? Of course, at 12 years old, I also kept asking my mother if we could buy a car that transformed into a robot.

It wasn’t until I was in my mid-teens, after I discovered real science books and writers like Carl Sagan, that I learned that not only is there a lot of evidence that shows how the pyramids were built by humans, but that Von Daniken himself had no real knowledge about the history of Egypt. Also, that Cybertron wasn’t a real place.

I don’t feel too guilty about getting duped by Von Daniken. After all, Chariots of the Gods was a New York Times best seller, with millions in sales, and even today people still believe there is some connection between aliens and ancient artefacts like the pyramids, Stonehenge or that pothole under the Chaguanas flyover.

The pyramids evoke such an awesome sense of wonder that people are willing to suspend all logic when thinking about them. Perhaps that’s why this week when some residents of La Horquetta were told their investment was a pyramid scheme, many simply went, “Cool, I’m like a pharaoh.”

Incidentally, the original pyramid scheme may have been the pyramids themselves. Pharaohs didn’t build pyramids simply because they thought they looked cool; pyramids were essentially giant political vanity projects, and each successive pharaoh wanted a bigger, better monument to this greatness.

But, like all vanity projects, pyramids cost money. Pyramid construction cost Egypt so much that the state eventually went bankrupt. At one point, Egyptian priests would hire grave robbers to break into pyramids to retrieve buried gold and treasures that would be used to refill state coffers.

Ironically, I learned that last piece of history when I was doing copy writing work for a certain insurance company that had the pyramid within their logo. Specifically, when I got laid off and had nothing to do all day.

I admittedly know very little about how the pyramid scheme works. But from what I have gathered, you put some money in as your initial investment and then somehow can draw double your investment in a short period. I don’t trust any investment that appears to give better returns than Wappie.

Now, I’m no Warren Buffet, but this $22 million situation sounds suspiciously like a Ponzi scheme. Named after Charles Ponzi, an Italian-American con-man who is most associated with this racket, Ponzi schemes work by misleading investors by claiming profits are originating from product sales or other means, but are derived from the investors themselves. Some investors who exit the scheme early may make a profit, but the majority will lose their money. As an investment, you’re safer betting your life’s savings on a Play Whe mark you dreamt than putting it in a Ponzi scheme.

The interesting thing about the pyramid issue and the arrest and subsequent release of the person running it has been the racial angle attached to it. Some of those who invested their money told the media the scheme was legitimate and they felt that since it was mostly Afro-Trinis who were investors, this was an attack on Afro-Trinis who were simply trying to make money as a community.

It’s this last angle that should raise red flags for anyone thinking about putting their money in the scheme. Well, that and the fact that guy who was running it was keeping millions of dollars in cardboard boxes in his house.

To understand why, you need to look at the largest Ponzi scheme in history run by Bernie Madoff. Madoff wasn’t just running a Ponzi scheme; he was also running what is known as an “affinity fraud”. That is, he was targeting people like him. Madoff was Jewish, and he especially preyed on Jewish investors and charities. Essentially, affinity fraudsters rely on a psychological weakness we all have, which is thinking people “like us” are less likely to rip us off.

In that context, the $22 million situation may not be the biggest Ponzi scheme in T&T.

• Darryn Boodan is a freelance writer

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