Colombia: Pyramid scheme victims to get pittance

Thousands of Colombians who invested nearly $700 million in a massive pyramid scheme will face further insult to injury.

The collapse of some pyramid operations late last year led to outrage, protests, and riots in several cities. These faux-financiers specifically targeted lower-class people and promised as much as 150% return. One company in particular- DMG Holdings- was even accused of being a money laundering front for Colombian drug gangs.

In the case of DMG, the firm was able to operate for three years under lax government supervision and alleged corruption. It was for this reason why some investors duped by the company defended DMG founder David Murcia as a Robin Hood-like figure.

Resentment and anger which still persists among those who lost their savings in DMG are likely to be peeved off at a government decision made today:

Thousands of investors who lost savings, big and small, in a Colombian pyramid scheme will receive just $96 apiece in compensation, the government announced Friday.

Maria Mercedes Perry, the official named to oversee DMG Group Holdings SA, said the government so far has recovered just 52 billion pesos — about $20.5 million — largely in cash found in the company's offices.

She said it would be divided equally among the 214,000 investors, regardless of how much they had deposited.

Granted, something is better than nothing. But for those whose goals of buying a new house, and investing for their future children (like some in my family) $96 does little to repair their shattered dreams.

Image- AFP (“A man holds a sign reading "what about my money?" in Popayan, department of Cauca, Colombia.”)
Online Sources- AP, Americas Quarterly, Council on Hemispheric Affairs, The Latin Americanist, Plan Colombia and Beyond, MSNBC