Wednesday, November 12, 2008

Chiahpuam or Ponzi Scheme in Mizoram

Chiahpuam or Ponzi Scheme in Mizoram
• How it Works
• How they Claim it Works.
• How Investments should Actually Work
• Effect of Chiahpuam in Mizoram
• Can Chiahpuam be avoided, is there away to avoid such schemes?
• Chiahpaum Moral View

How it Works
Chiahpuam or Ponzi scheme to very simply define, is a downline marketing scheme which does not rely on any investment plan but on fraud. In this model each person must recruit two others, but the ease of achieving this is offset because the depth required to recoup any money also increases. The scheme requires a person to recruit two others, who must each recruit two others, who must each recruit two others.

The "8-ball" model contains a total of 15 members. Note that unlike in the picture, the triangular setup in the cue game of eight-ball corresponds to an arithmetic progression 1 + 2 + 3 + 4 + 5 = 15. The pyramid scheme  is a geometric progression 1 + 2 + 4 + 8 = 15. Prior instances of this scam have been called the "Plane Game" and the four tiers labelled as "captain", "co-pilot", "crew", and "passenger" to denote a person's level. Another instance was called the "Original Dinner Party" which labelled the tiers as "dessert", "main course", "side salad", and "appetizer". A person on the "dessert" course is the one at the top of the tree. Another variant "Treasure Traders" variously used gemology terms such as "polishers", "stone cutters" etc. or gems "rubies", "sapphires", "diamonds" etc.
Such schemes may try to downplay their pyramid nature by referring to themselves as "gifting circles" with money being "gifted". Popular scams such as the "Women Empowering Women" do exactly this. Joiners may even be told that "gifting" is a way to skirt around tax laws.
Whichever euphemism is used, there are 15 total people in four tiers (1 + 2 + 4 + 8) in the scheme - the person at the top of this tree is the "captain", the two below are "co-pilots", the four below are "crew" and the bottom eight joiners are the "passengers".
The eight passengers must each pay (or "gift") a sum (e.g.Rs1000) to join the scheme. This sum (e.g.
Rs 8000) goes to the captain who leaves, with everyone remaining moving up one tier. There are now two new captains so the group splits in two with each group requiring eight new passengers. A person who joins the scheme as a passenger will not see a return until they exit the scheme as a captain. This requires that 14 others have been persuaded to join underneath them.
Therefore, the bottom 3 tiers of the pyramid always lose their money when the scheme finally collapses. Consider a pyramid consisting of tiers with 1, 2, 4, 8, 16, 32 and 64 members. 

No matter how large the model becomes before collapse, approximately 88% of all people will lose.If the scheme collapses at this point, only those in the 1, 2, 4 and 8 got out with a return. The remainder in the 16, 32, and 64 tier lose everything. 112 out of the total 127 members or 88% lost all of their money.

How they Claim it Works.
From what I here, there are two ways people are made to believe they are investing in some business:
1. They claim to invest in currency exchange with conversion of Indian rupees into Burmese Kyat, but this is unlikely given the volume of huge sum of money involved, believed to be in crores when currency convertibility is not even allowed by the Myanmar or Burmese Government.
2. Fake Currency: There are also claims that fake Indian currency coming in from Bangladesh and other countries are deposited into the bank and withdrawn again from the bank creating a huge surplus. This is also unlikely as tellers within Indian Banks are trained to verify authenticity of Indian currency.

How Investments should Actually Work
When making an investment weather in a Mutual Fund or a Fixed Deposit in the Bank, your hard earned money should be invested in Asset Generation which would yield profit in the long term. The Money you have invested could have been taken as a loan to build a Highway to upgrade the infrastructure of your state and money recovered from toll booths, or else it could have been taken as a loan by a car manufacturer who would use your money to build Industries which would manufacture Cars, Trucks etc and then share the profit from sales of those vehicles back into your investment, hence the chance for a 50% or even a 10% return on investment within a week is unlikely in a legitimate business.
Mizoram is not a sole exception in this scheme and has happened internationally, the most famous of which could be the Ponzi scheme which has a long history within itself as he made a lot of money, A scheme in Albania where more than 1.2 billion was lost could be another case, and recently the SH Shah case in Pakistan.

Effect of Chiahpuam in Mizoram
The effect of chhiahpuam in Mizoram could be adverse as the people who have invested would lose their money and their uplines who have pocketed the money would be reluctant to utilize the money they have received, creating a condition of economic glut within the state with economic growth grinding to a halt. The Main source of this investment could be of three types –
The first one being of the naïve poor people who have heard of the get rich quick scheme and have invested their life savings in it leaving them more vulnerable as their security is gone, they could have invested only a few thousands which could still be a huge amount for them.
The second could be those who have invested money not their own, some of them could have taken bank loans who would know have no way of paying back even the principle amount, others could be people who have invested Government Department money under their care or even Church money which is money contributed by the general public for use of the community.
The Third could be people who have got money through illegitimate means – corruption which they have no way of investing as white money hence the investment within this schemes.

Can Chiahpuam be avoided, is there a way to avoid such schemes?
My answer to that would be Yes, it’s possible to avoid such schemes if measures can be taken, when such measures have not been taken, it could also reflect on the strength or weakness of the government.
One big loophole that I notice according to me is the lack of Income tax for Individuals within the state. There’s not check and balance system to check that the money withdrawn or deposited is for legitimate reasons. For Example, if a person had got a money illegally, he can still deposit lakhs or millions of rupees without any question from where he has got it as there’s no PAN card system or taxation system to check an individual’s source of Income in Mizoram. It’s a blessing for the State as a whole that there's no Income Tax but the fact that some people are exploiting it for cheating others make it a burden for society. The present Mizoram state Government has recently come up with a state health Insurance policy for the Non Government public wherein the premium is just around Rs 100- Rs 200. What I would like to suggest here is that Why don’t the Mizoram state Government create a Tax exemption limit for people earning above Rs 50,000 but earning below 100,000 that they get their tax exemption limit only on the condition that they pay premium for their own health Insurance, Life Insurance and Investment worth Rs 50,000. Those earning below Rs 50,000 could possibly get complete tax exemption and those earning above a certain amount, say Rs 500,000 or more could pay higher tax to subsidize those who cannot afford to pay for Insurance or have enough for Investments or else allocate it build up the very much needed infrastructure needed within the state like Hydel Projects, Better Roads, Educational and Medical Facilities.
The reason that I’m very particular with the Life Insurance and Health Insurance is two sided, on one side to reduce the State Govt Deficit which is an all time high of almost Rs 3,000 crores, and on the other hand the fact that Mizoram is the Cancer Capital of India with six districts of Mizoram among the top ten districts in India with cancer cases. I’m not here to debate about the good or bad affect of smoking but being practical with bearing the consequences of Cancer. With Mizoram having a high incidence of Cancer, it’s natural that a lot of the Mizo people are going to have Medical Problems related to Cancer, which could prove costly for the families within Mizoram, reducing them to further poverty due to Medical care required, added to that the inevitable death of the Cancer patient leaving behind a wife and children’s with almost no means to support themselves, the least that the state Government can do to Mitigate the adverse affect on the family is to make it compulsory for citizens with the means to purchase Health Insurance and Life Insurance so that they can better face the cloudy days ahead. The wealth and health of the citizens in Mizoram also has an adverse affect on the State Government of Mizoram itself.

Chiahpaum Moral View
Mizoram being a Christian state, one can’t but help the Church meetings almost throughout the week, the Gospel Camps, people dancing in the Church with Joy but these are the same people, sometimes in trouble because of investment in Fraudulent schemes. Is it possible that these people are looking for a shortcut to spiritual growth by foregoing reading the good book by indulging in emotional hysteria, in the same length, are they trying to forego hard work by searching a short cut to success? Has money become god for a society which had lived without it 100 years ago? These are hard questions to answer but I would like to say the answer lies within the same book which states “Dishonest money dwindles away, but he who gathers money little by little makes it grow”, that I think sums up the way things should be.

Monday, November 10, 2008

Mizoram People’s Conference

Mizoram People’s Conference

A party started by retired Brigadier Thenphunga on April 17, 1975 in Mizoram. He first started out as a Human right Activist in 1974 before starting his Political Party.

Mizoram People's Conference was in power from 1979 to 1984.Following the MPC's defeat in 1984, it was the main opposition party for the next 2 decades. In the 1998 assembly elections, it won 12 seats. However, in the 2003 elections, the party won only 3 seats, and fell to 2 seats in the 2008 elections. The MPC is still the third largest party in Mizoram

Party President: Brigadier Thenphunga

Electoral History MLA Vote %

1978 to 1978 22 37.47%

1979 to 1984 18 32.67%

2008 (UDA) 4 24%

Sunday, November 9, 2008

Mizo National Front

In 1959, Mizo Hills was devastated by a great famine known in Mizo history as ' Mautam ' . The cause of the famine was attributed to flowering of bamboos which consequent resulted in rat population boom in large numbers. After eating up bamboos seeds, the rats turned towards crops and infested the huts and houses and became a plaque to the Villages. The havoc created by the rats was terrible and very little of the grain was harvested. For sustenance, many Mizos had to collect roots and leaves from the jungles while a considerable number died of starvation. Earlier in 1955, Mizo Cultural Society was formed in 1955 and Laldenga was its Secretary. In March 1960, the name of the Mizo Cultural Society was changed to ' Mautam front' During the famine of 1959-1960, this society took lead in demanding relief and managed to attract the attention of all sections of the people. In September 1960, the Society adopted the name of Mizo National Famine Front (MNFF). The MNFF gained considerable popularity as a large number of Mizo Youth assisted in transporting rice and other essential commodities to interior villages.
Underground Movement
The Mizo National Famine Front, which was originally formed to help ease the immense sufferings of the people during the severe Mautam Famine in Mizoram, was converted into Mizo National Front (MNF) on October 22, 1961. The ways in which the authority of the day handled the famine left the people disillusioned. The wave of secessionist and armed insurrection was running high among the Mizos. The secessionist movement held on for about two decades.
Peace Settlement
This chapter of insurgency finally came to a close with the signing of the Mizoram Peace Accord on June 30, 1986 between the underground government of the Mizo National Front and the Government of India. Under the terms of the peace accord, Mizoram was granted statehood in February 1987. Laldenga became Chief Minister, but soon lost power due to defections in the party.
Party President: Zoramthanga
Electoral History MLA Vote %
1986 to 1987 NA NA
1987 to 1988 24 43.31%
1998 to 2003 21 24.90%
2003 to 2008 21 31.69%
2008 to 3 7.5% (Worst Record for MNF)
Advantages: It has a very strong support base and they have started lots of populist policies recently like distribution of rice at a subsidized rate as well as the State Health Insurance Scheme which has taken off recently. Increased road and Infrastructure projects were completed.
Disadvantages: MNF party already have the Incumbency factored against them. Added to that some of the ministers have lots of corruption allegations against them, also some of the Ministers are said to be not competent enough to handle their respective portfolios.
Mizoram Election 2013 MNF Candidates with MPC and MDF:

No. Constituency    
1 Aizawl South 1 RK Lianzuala MNF
2 Aizawl South 2 R Tlanghmingthanga MNF
3 Aizawl South 3 Tawnluia  MNF
4 Aizawl North 1 Vanlalhlana MPC
5 Aizawl North 2 Lalthanliana MPC
6 Aizawl North 3 Lalchhandama Ralte MNF
7 Aizawl East 1 Lalhmangaiha Sailo MPC
8 Aizawl East 2 Sailothanga Sailo MNF
9 Aizawl West 1 K. Sangthuama MNF
10 Aizawl West 2 Lalruatkima MNF
11 Aizawl West 3 Vanlalzawma MNF
12 Serlui Lalhmingliana MNF
13 Tuivawl Gogo Lalremtluanga MNF
14 Chalfilh LT Kima Fanai MPC
15 Tawi Lalmalsawmi MNF
16 Dampa Liansuama MNF
17 Hachhek Saikapthianga MNF
18 Mamit HB Lianmunga MNF
19 Tuirial Dr Kenneth Chawngliana MPC
20 Kolasib Lalchamliana  MNF
21 Lengteng L Thangmawia MNF
22 Tuichang Dr. Lallungmuana MNF
23 Champhai North TC Kaphmingthanga MNF
24 Champhai South Rosaiamngheta MPC
25 East Tuipui Zoramthanga MNF
26 Serchhip C Lalramzauva MNF
27 Tuikum Lalrinawma MNF
28 Hrangturzo Lalthansanga MPC
29 South Tuipui ZH Ropuia MNF
30 Lunglei North Dr K Vanlallawma MNF
31 Lunglei South Dr K Pachhunga MNF
32 Lunglei East Lalrinzuala MPC
33 Lunglei West Dr. R Lalthangliana  MNF
34 Thorang Joseph Lalzawmliana MNF
35 West Tuipui Priti Ranjan Chakma MNF
36 Tuichawng RM Chakma MNF
37 Lawngtlai West C Ramhluna MNF
38 Lawngtlai East Vanhupa Zathang MNF
39 Saiha Dr K Beichhua MNF
40 Palak PP Thawla BA MDF

Saturday, November 8, 2008

Congress - Mizoram

 The Congress Party opened it's unit only in 1961 . The Mizoram Union and Congress Party Merged after discussion between Mizo Union Leaders and Nehru on Janurary 1974 to oppose the then MNF movement.  United Mizo Freedom Organization started  in 1947  supported by the Village Chiefs.
Party President: Lalthanhawla
Electoral History                MLA        Vote %
1984 to 1986                  20         39.81%
1989 to 1993                  23         34.85%
1993 to 1998                  16         33.10%
1998                     32         36.00%

 Mizoram 2013 Manifesto Highlights:


Chief Minister's Rural Housing
Mental Hospital
Women & Child Development department an
State referral Hospital 150 - 400- Upgrade to Medical college
Aizawl Convention Centre
Cable car (ropeway)
Lok Ayukta
Electricity in all Mizoram Village and produce 280 MW
Mizoram Youth Commission
Upgrade Labour & Employment department  Mizoram Skill Development Society
Universal Elementary Education
Upgrade road and bridges.
High Court

2013 Candidates

Aizawl South 1
R Vanlalvena
Aizawl South 2
Col ZS Zuala
Aizawl South 3
KS Thanga
Aizawl North 1
Aizawl North 2
Aizawl North 3
Aizawl East 1
R Lalrinawma
Aizawl East 2
Lalsawta- Ex MCS
Aizawl West 1
TBC Tlangthanmawii
Aizawl West 2
Dr Lalmalsawma
Aizawl West 3
Dr Ngurdingliana
R Lalzirliana
Lalrinmawia Ralte
John Roltuangliana
Hmingdailova Khiangte
H Rohhluna
Lalrinliana Sailo
Champhai North
TT Zothansanga
Champhai South
JH Rothuama
East Tuipui
T Sangkunga
K Lianzuala
South Tuipui
John Siamkunga
Lunglei North
PC Lalthanliana
Lunglei South
S Laldingliana 
Lunglei East
Joseph Lalhlimpuia
Lunglei West
Chalrosanga Ralte
West Tuipui
NK Chakma
Dr BD Chakma
Lawngtlai West
Lawngtlai East
S Hiato BA