Translated material
The MMM era
Sergei Mavrodi was always looking for ways to make money. And if in Soviet times private business was punishable by law, then perestroika and the subsequent transition to a market economy opened up a wide field for its mathematical and entrepreneurial talents. In 1993, on television, which was not yet so burdened with advertising, videos appeared where the MMM company offered everyone to buy its shares, the price of which was supposed to constantly increase. Accordingly, the more securities you buy, the more you will earn from their resale. It's simple. Moreover, it is so simple that it even raised doubts among many about the success of the enterprise. But Alexander Livshits, who was then Minister of Finance, reassured the doubters and announced on television that the actions of the head of MMM, Sergei Mavrodi, were absolutely legal. And the citizens took their money to the foot of the Mavrodi pyramid, which literally reached incredible proportions in just a few months. Sales points for MMM shares appeared all over the country, people vied with each other to discuss their rates, which were indeed growing day by day. Mavrodi himself became almost a folk hero.
The “benefactor” also never forgot to encourage his “flock” and periodically organized various events in order to demonstrate the inviolability of his pyramid. So, he once gave Muscovites a whole day of free metro travel. The heroes of MMM commercials - Lenya Golubkov, who bought boots, a car and a dacha for his wife Marina, turned almost into folklore characters. And the Mexican actress Victoria Ruffo from the then mega-popular television series “Simply Maria”, who also participated in the “MMM” advertising, completely charmed the audience.
Sergei Mavrodi was simply swimming in money and could afford any whim. He married a young fashion model, the beautiful Elena, and hung all of Moscow with huge posters with her portrait. Opened an office on Red Square.
The country seemed to be gripped by euphoria, and few people thought about how MMM shares were actually growing. And in 1994, the MMM pyramid collapsed, and the “valuable” securities immediately turned into toilet paper. People began to really panic. “They deceived me, they cheated me!” - some shouted. “Mavrodi was framed!” - others assured.
In August 1994, Mavrodi was arrested and accused of concealing income from the Invest-Consulting company he headed. But two months later he was released. The idol of fans did not disappoint and in the same year became a State Duma deputy, acquiring immunity from criminal prosecution. Sergei Mavrodi spent a year in the deputy chair (in the Duma itself, however, he did not appear often), and in October 1995, when the prosecutor’s office asked to deprive him of his deputy status, he simply disappeared.
Only then was the investigation into the activities of MMM resumed, but Mavrodi was put on the international wanted list only in 1998. They found him only five years later in an ordinary rented apartment in Moscow in a rather pitiful state - in an old training suit and a curly wig. As it turned out, over the years Mavrodi tried to organize an “Internet pyramid” abroad, moving to Greece for a while, but due to the activity of foreign police officers, the project was quickly closed. Meanwhile, he himself returned to Moscow, where he lived on a fake passport in the name of citizen Zaitsev. At the same time, according to unofficial information, Mavrodi was guarded and provided with life in the underground by employees of one of the special services, who thus earned money “on the side.”
In 2003, for falsifying documents, he received his first sentence after his arrest - one year and one month in prison. At the same time, the tax evasion case was dismissed due to the expiration of the statute of limitations. By the way, at the beginning of that year, Sergei Mavrodi’s younger brother, Vyacheslav, was sentenced to five years and three months in the Chertanovsky court for illegal banking activities and illegal trafficking in precious metals. As the court found, he was engaged in illegal banking activities through the organizations he created - the system of mutual voluntary donations (SVDP), MMM-96, MMM-97. Vyacheslav Mavrodi was released from prison in April last year.
And for Sergei Mavrodi, Matrosskaya Tishina remained home for several more years. He was charged with fraud - the damage he caused to almost 10 thousand investors was estimated at 110 million rubles. (Although unofficially, according to intelligence services, several hundred thousand people suffered from his actions, losing about $100 million.) It took Mavrodi three years just to get acquainted with the materials of his case, which fit into 625 volumes. But he was never bored in prison. During this time, Sergei Panteleevich wrote two books and published a collection of poems. He even got used to making mash from fruit juices and for a long time led the guards by the nose, who were perplexed why their charge was always “under the weather.” Since then, juices have been among the products prohibited for transfer to pre-trial detention centers.
The trial in the “main” Mavrodi case began in March 2006. The process resembled more of a circus performance than a judicial action. This was facilitated by dozens of victims and witnesses who, divided into two hostile camps, vied with each other and shouted: “Freedom! Freedom! or “Shoot! We’ll strangle you!” A month ago the culmination came - the court began to announce the verdict. There was no doubt that the verdict would be guilty. But it was also obvious that Mavrodi was unlikely to stay in prison for long. Officially, Sergei Mavrodi is accused under Art. 159-3 of the Criminal Code of the Russian Federation - fraud on a large scale, punishable by up to six years in prison. It turned out to be impossible to apply the stricter Article 159-4 of the Criminal Code for especially large amounts of theft (which amount to 110 million rubles), since at the time of the crime the existing old Criminal Code did not know “especially large amounts”, and to apply a more severe measure of punishment under the new The Criminal Code was impossible - the criminal law does not have retroactive force.
The court fully agreed with the accusation and found that on June 16, 1993, Sergei Mavrodi “registered the issue of 991 thousand shares of MMM with a par value of 1,000 rubles in order to deceive citizens and seize their funds.” In fact, almost three times as many securities were issued, but the par value was not indicated. On the share certificates, the MMM Trade and Financial Company OJSC acted as the organization bearing obligations to the owners of the securities, and not the registered MMM OJSC. “Thus, Mavrodi deliberately distributed shares of a non-existent organization and deliberately misled the acquirers regarding the properties of the “securities.” Mavrodi, according to investigators, used the money received from MMM investors in the following way: he transferred part of it to the accounts of his companies and cashed it out, invested part of it in shares of large companies, and spent another part on the development of the business (Mavrodi invested more than 15 billion non-denominated rubles in advertising "MMM" and the opening of new sales points). According to investigators, the collapse of the pyramid was inevitable. “Payment of deposits and interest on them was made not at the expense of income received from investment investments, but at the expense of the receipt of funds from new investors,” the indictment states. “These actions resulted in the amounts payable exceeding the amounts received.”
The prosecutor did what he could - he asked for the maximum six years for Mavrodi. The court gave it 4.5. And yesterday this period expired.
Moreover, the investors were left with nothing. As an additional punishment, the court imposed a fine on Mavrodi in favor of the state in the amount of 10 thousand rubles. And the court suggested that the victims file claims for recovery of material damage in the amount of 250 million in civil proceedings.
Among the defrauded investors there were those who considered the main culprit not Mavrodi himself, but the officials, because of whose connivance the scam became possible. In particular, they argued that the MMM pyramid was born and grew thanks to the connivance of the Ministry of Finance, which was supposed to control the process of issuing securities, and not assure on television of the legality of Mavrodi’s actions. Therefore, an initiative group of citizens intends to involve the authorities as co-defendants for compensation for the harm caused to them by the Mavrodi empire.