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As I write this post, Public Likes, yet another scam is collapsing with millions of Kenyans’ money. Public Liked was marketed as a “Revolutionary Social Media Marketing” platform, that paid people for paying to view ads and to recruit others. We have seen a number of social media posts from angry subscribers who are unable to withdraw their returns, and as at 11am, Safaricom announced that it had shut down their Paybill number.

Why do we keep falling for these scams?

1. Investing information is scarce and shrouded in jargon: The other day, we were discussing why the government’s second M-Akiba bond issue has failed to achieve full subscription. There are many reasons, but key of those is the fact that information about the bond was not disseminated well. I joked that my mother in Meru has heard of, and invested in FEP (a story I will tell another day), yet she has not heard enough about M-Akiba to consider it a viable investment. A second example is the Stanlib REIT, which was rather understated – to this day, most Kenyans do not know what a REIT is, or even whether it is a good investment avenue or not.

People who create and market genuine investments do not invest enough in educating the masses, neither do they create enough hype for their investments to enter the consciousness of ordinary people.

This lack of education about investments leads to a populace that has unrealistic expectations about the returns an investment should make for them, leaving us vulnerable to scammers. It does not help that oversight bodies are lax, when it comes to pyramid schemes.

2. Investments are boring. There are no mysteries: When you take time to learn about investments, you discover that passive investments, where you are not actively trading or managing the investment, have “boring returns”. You cannot realistically double your money every year. Neither can you make 15% per month like the scams promise.

When you invest in a business you are not running, it follows logic that the person running the business will not give you 100% of the returns – and very few businesses even double their profits every year consistently. The fundamentals of finance are well known, and while there are opportunities to once in a while make superior returns, on average, most passive investors will make returns within a certain conservative range.

When an investment that promises super returns with minimal effort comes your way, ask yourself two questions:

  • What is the underlying business that makes these returns? Who is paying for the product/service that is generating return?
  • Does the answer from the question above align with what I know about the industry?
  • If I had an opportunity to make this much money, would I share it with others, or would I just make the cash?

In the Public Likes example, it is said that advertisers pay Public Likes, which then passes on a portion of that fee to the subscribers. As this article debunks, the margins paid do not make sense, and advertisers typically will not pay to get views from paid audiences.

3. “But others are making money”: This sentence is the one reason people use to invest in scams. Knowing someone/people who invested and made some return out of the whole thing. This belief overlooks the fact that a scam succeeds by looking like the real deal. The first investors are paid off from the money invested by the next investors, and so on and so forth. For as long as new investors are coming in, the scam keeps growing, until it cannot grow anymore, and it collapses. This history of Ponzi Schemes shows that nothing is truly new under the sun. The tactics that scammers used in the 1800s work even today.

Scammers also know that human beings are innately greedy. A large percentage that make their money back tends to invest it or even more into the scam, and the scammers profit off this desire.

4. We let go of the bird in hand too easily: One of the capital rules of growing wealth is learning the art of preserving what you have.

Unfortunately, the stories that make it to the newspapers are not the boring stories of people building wealth via the boring fundamental routes, but those that “risked it all”, and made it “bigly” in the end.  While I do not deny that this happens, I know that it is very rare, and often involves factors that are not told in the story.

Learn to hold what you have made dear, and to do enough homework, before entrusting it to someone else to manage it for you. When investment experts advice caution (as they always do when these scams come up), there probably is cause to worry.  Remember, and treasure the 5th Law Of Gold.


  1. Angela Kamanzi July 25, 2017 at 8:32 pm Reply

    I’ve witnessed virtual fights on WhatsApp groups between those who were making the money -with MPesa receipts as proof-and those who cautioned that the thing will eventually collapse. I hope people will gradually learn to become wise investors if people like you Kelly continue to educate them, Keep up the good work.

  2. Kaunda November 2, 2017 at 12:54 pm Reply

    I came across this blog recently and I’m absolutely loving it. Back to the issue at hand, the government should have done better. You just don’t tell us to invest in M-Akiba without going into details or at least showing us the benefits compared to let’s say Fixed deposits. I for one thought it was part of Safaricom many business Ventures.

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About the Author

When I’m not here writing, I run Lattice Training, where we offer customized training solutions for businesses of all sizes, from startup entrepreneurs all the way to large corporations.
The aim of this blog is to simplify personal finance. I write about budgeting, personal finance, management and doing business in Kenya, in a way that everyone will understand.

If you have questions or would like to get in touch with me, leave your details on the form below, and I will get in touch. Thanks for reading.

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