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POV Philippines by Jon Joaquin


by Jon Joaquin

Almost overnight, it seems, Mindanao has been overrun by get-rich-quick schemes that promise unbelievable returns for one’s investment. It started with a group calling itself “Kapa” (short for KAbus PAdatoon, which is “make the poor rich” in Visayan), a group led by a self-proclaimed pastor who promises 30-per cent interest every month “until forever.” The twist in Kapa’s operation, and the one that its leader and members use in their claim that this is no scam, is that no actual investments are made or solicited. Instead the members “donate” the money, and it is this amount that is used for various “investments” that yield the 30-per cent interest.

Kapa has grown to several thousands of members since gaining traction last year, and its members can be very rabid in supporting their pastor. Like most things these days, Kapa has a presence on social media and even uses it to expand its operations, and it is on this platform that members often spew abuse against those who are vocal in criticizing the group. I have friends who have been called liars and branded as stupid for daring to call Kapa a scam, using their own earnings – called “pay-out” in these parts – as proof that their operations are legit. I’ve seen photos of people showing off bundles of cash and promising recruits that they stand to earn the same; they can be pretty convincing for those who want to earn money the easy way.

But as with any scheme that becomes successful, Kapa has been copied by various other groups with promises of even bigger returns – ranging from 40 per cent to a full 100 per cent interest per month. There are now so many it’s hard to keep tabs on them. I can only recall the names Rigen Marketing and ALMAMICO (Alabel Maasim Small Scale Mining Cooperative), but there are quite a few more. Most of them differentiate themselves from Kapa by introducing products – and even bitcoins – into their marketing schemes, but the heart of their operations is the promise of unrealistically high interest yields.

The twist is that these new schemes are attracting even members of Kapa, so much so that its leader has noticed that the number of his investors is starting to dip. This prompted him to issue a declaration a few days ago saying any Kapa member who invests in other groups will be blacklisted. To me this shows the basic flaw of scams like these: they depend on people coming in to the group with fresh money (called “pay-in”), which is used to pay those who had joined before them (called pay-out). As long as there are new people paying in, Kapa and the other groups can continue paying out the earlier members. Eventually, however, there will be no more people to recruit. No matter how hard it tries, the organization will not be able to entice any more people to pay in, and when that happens the whole thing collapses. Unfortunately it will be the vast majority who came in late who would bear the brunt of the collapse, and they stand to lose heavily.

It’s easy to blame the rise of scams like these to poverty and the ignorance it often breeds, but the reality is that a lot of people who “invest” in them are actually from the middle class and presumably well educated. Many of them can even afford to put in six-digit figures. The rush to invest is fuelled by stories of people who strike it rich. Everyone seems to know a teacher who paid in P10,000 and earned P100,000, or a government worker who plunked in P50,000 and earned P500,000, or a doctor who invested P1 million and ended up with P5 million.

I have several co-workers who have withdrawn their life savings and invested in some of these get-rich-quick schemes, and they based their decision on some of these stories. They cite friends who earn huge sums in their pay-out, but when I ask them if their friends already collected their money, they would invariable say, “Wala pa, sa next pay-out pa.” (“Not yet, [but on the] next pay-out.”) It all appears to be on paper and amounts to nothing but promises.

I tell these co-workers that even if they manage to get a return on their investments, it would be at the expense of hundreds or even thousands of others who will not be able to collect on their pay-in. That’s when they display the kind of attitude that fuels these scams: “Bahala na. At least nakaganansiya ko.” (“I don’t care. At least I earn my money.”)

The views and opinions expressed in this column are those of the original author, and do not necessarily represent those of the Pilipino Express publishers.

Jon Joaquin is the Editor-In- Chief of the Davao City-based Mindanao Daily Mirror. E-mail Jon at

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