Yup I thought about it too, would someone share the Holy Grail with others but then I remember the below.

I remember a saying once, "With more money you can make even more money".

Perhaps this is the business model, till we know the truth, we won't really know how they manage to do it.

Added:

The copycat idea exist bro, NFC was one of them but sadly I got no source that I can share with you cause it was told to me and many others during a BA speech. (You can ignore this if you want) but no need to look far also another good example is Apple and Samsung

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Added on October 4, 2012, 6:36 pmYeah, I also wanna know this bro, by the way good question.

This post has been edited by celicaizpower: Oct 4 2012, 06:43 PM

Shouldn't consultants know about the inner workings as well?

Erm... not sure, never bothered asking my friend about this... will ask him when I meet him later.

To all Geneva supporters.......
Just imagine wat would happen if bnm lift the freeze?

If I m a Geneva customer, I will immediately return the gold to them n get my money back. If only 10% of the 80k customers do the same like me, Geneva will also close down the very next day.

So, don't be naive.
The directors are in cahoots with the authorities to con yr money.
The best solution is to form a Geneva complaint group and get a lawyer to represent u and sue the directors. Bnm will not listen to yr appeals.
Sue the directors for every sen that they have.

Have dignity and admit that u r naive enough to be conned.
To continue to support Geneva is just showing how stupid u r.

saw many videos showing how persistent that the customers feel Genneva is doing a good job to help them overcome their financial difficulty. an indian lady said because of Genneva, she can pay for her parent's medical bill.

in thestar today, saw a medical doctor receiving rm8k each month, invested rm400k. said the return from Genneva is giving him financial support to fund his child education in London.

i'm thinking, just because a company is helping the client to get over their financial difficulty, that doesnt necessary mean the company is legitimate. imagine this, by introducing more drug addicts to a drug dealer, you get paid handsomely. when police catches the drug dealer, does that means people should march to putrajaya and demand the drug dealer to be released?

This post has been edited by property101: Oct 4 2012, 07:04 PM

Let's assume that the company has collected RM4b...
After deducting cost n expenses, left RM1b....
Payoff the raiding party ....RM1m....
Balance....RM999m to be shared among the directors....

consultants and customers, u have been conned!
Forget this whole episode n move on....
Learn yr lesson ....money don't fall from the sky...unless u belief in Ayah Pin and his giant kettle....

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Added on October 4, 2012, 7:28 pmSomething I just read"........

What the newspapers didn't mention on Genneva -> Financial Ruin for some.

I've been following this Genneva thing for years... as a student of Economics, I always felt it was educational to watch a Ponzi scheme all the way from the good times all the way to collapse, instead of merely doing case studies "in hindsight" (while actually most famous economists are only really good at hindsight analysis lol)
Along the way, I tried to advise against putting money in, and I was cursed, ridiculed, and jeered at. Which is pretty normal for the "returns being given" phase of any Ponzi scheme.

Anyhow, the newspapers only mentioned that investors will lose a source of monthly revenue, and also that they stand to lose the 20%-30% markup they paid for their purchased gold.
So, someone who had RM1,000,000 in the bank, and bought RM800,000 worth of gold with it stands to lose RM200,000, right? Not good, but still survivable, right?

Not for some.

For some, the scenario is much MUCH worse, thanks to many Genneva clients taking stupid advice from the Genneva agents to "leverage" their income. Because the suggested method was through Islamic Banking quasi loans with the gold as collateral. Let me give an example of what happens using the same above ex-millionaire.

Bob starts with RM1,000,000.
He goes to Genneva, pays RM1m, gets 800k worth of gold. Genneva promises him an income stream of 2% ie RM20k per month. They promise to buy the gold back at RM1m upon maturity.

NOW, under his agent's advice, he goes to Al-Rajhi bank and gets an "Islamic loan", which is similiar to a normal loan but with worse terms. Basically, they take the 800k worth of gold as collateral, and give him 75% on it, RM600,000. BUT, the interest (they call it a protection fee for storing the gold) is based on the 800k, and they charge 1% per month!

So, now Bob has RM600k in his pocket, 600k debt, and 800k being held as collateral.
The 800k is an asset, but a quasi asset, as people who have failed to service their loans would know!
He also has a promise from Genneva that they will buy his 800k gold for RM1m.
He also has incoming 20k per month from Genneva and -8k a month from Al-Rajhi. Sounds good so far, right?

So Bob follows his agent's advice and further "leverages" himself.
He goes to Genneva, gives them 600k, and gets back 480k worth of gold.
He goes to Al-Rajhi (AR) and gives gold, gets 360k.

Current Status:
360k in pocket, 960k debt,  1280k gold held as collateral (gc) and an option to sell the gold back (goldoption) for RM1.6m.
Income stream 32k Genneva, -12.8k Al Rajhi.

He does it again.
-RM360k, + 288k gold.
-288k gold, + RM216k.

Status:
RM216 pocket, RM1.176m debt, 1.568m gc, goldoption 1.96m.
Income 39.8k Genneva, -15.68k AR

Let's stop here even though this could continue a few more rounds.

Anyhow, *IF* Genneva honors the agreement, at the end of 1 year, Bob redeems everything, and his status is now:
1960k (since he sells the gold, the 1.568m no longer comes into play)+216k-1176k +(39.8k x 12) - (15.68k x 12)
=RM 1m (his initial bank account) +477.6k -188.16k (the income streams)
=RM 1,289,440.
Bob makes a nice 29% profit in one year! He is happy!

BUT
If Genneva does not honor the agreement? For example, if the company ceased operations? Bob's status BEFORE HE GOES TO REDEEM HIS GOLD FROM AR is:

216k - (15.68k x 12)   (he has had to pay AR the monthly interest/ protection fee still!)

=  27.84k in his pocket!

And now, there are 2 possibilities at this point, actually. Cause in case you didn't notice, Bob only has RM27.84k in his pocket, and his debt is RM1176k. He can't get back his collateral unless he finds someone to lend him the money to get back his collateral!

Case A, someone lends the money to Bob:
Bob redeems his loan, get's back his gold.
Bob now has 27.84k in his pocket, RM1.176k debt to whoever gave him this new loan, and he has RM1.568k worth of gold.
He now has to figure out what to do with that gold!
If he manages to sell it for RM1.568k, his situation is not so bad.... that means that after squaring his debt, he now has 1568+1176+27.84= 419.84k.  This is a pretty bad drop, from RM1m, but Bob can still survive it.

However, if gold price has dropped, OR if he can only sell his gold for a lower price (VERY likely, gold shops and banks and other people who buy gold will take their share of the profit), Bob will lose even more. If he loses 10% when selling the gold, he now has 263k. If he loses 20%, he only has RM106k. Bob is now looking at some VERY serious lifestyle changes if he lost 90% of his savings.

How about Case B, where Bob cannot get anyone to lend him money?

Well, his situation is then that he has 27,84k in his pocket, and he's completely at the mercy of Al-Rajhi bank! I have no idea what happens in the case of default in this scenario, I need an expert in Islamic Banking Syariah law to explain this scenario to me.
But as far as I know, AR is still holding onto the gold, and therefore they are still charging him 15,680 per month as protection money, so AFAIK, Bob goes bankrupt in 2 months...

...

And don't get me started on the people who didn't have RM1m in the first place, like Bob above.
I've heard of plenty of people who took out loans to buy their initial "investment" in the first place... those people are now in EVEN WORSE TROUBLE than Bob in scenario B... they are ALREADY bankrupt, and have loan payments that they CANNOT MEET.

...

Makes the 20%-30% losses described in the newspaper look absolutely pleasant by comparison,


This post has been edited by KamikazePg: Oct 4 2012, 07:28 PM

After the incident with Genneva 1 & 2 the authority should not allow them to continue the Genneva part 3

Don't mind him. That lembu believes in guaranteed 15% per month return from gold. Look at his signature.

Need to get rid of all those cockroach gold scammers.

brace yourselves for part 3

Last year in TV1

After studying the claims by everyone here and in other sources, I would like to share some opinions on how this could be sustainable.

Genneva sells gold at a premium of say 25% with a contract for 2.5%*6 months return and promise to buy back the gold at spot price after contract ends. Which means in essence you are buying a call option for gold at a premium of 10% for a 6 month contract + giving a 6 month interest free loan on your 15% to Genneva.

In layman terms, Genneva is hoping that gold price does not rise above 10% in 6 months and using the interest from your "loan" to fund their operations, meantime you are hoping that gold will rise above 10% in 6 months and pocketing any of the returns above this 10%. This is all hunky dory until 1 side does not honor the contract or the contract is not well-written in the first place.

This is all legit business. However, due to lack of regulations and a liquid market to trade in these contracts, investors are at the mercy of the company honoring their "hibah" payments and promise to buy back the gold. Genneva must also ensure that their operating expenses are below the 10% including payments to their salesperson, marketing and operational activities.

It will only be a ponzi or scam when Genneva advertises guaranteed positive returns while not highlighting the risks. Of course, who would want to invest in a risky investment right? It will not make headlines.

So, in conclusion, the business can be real but only if you understand the risks which is not only gold price moving negatively but also the company giving fake promises.

I won't be going near this as I'd rather invest in a regulated and liquid market such as stocks, options and futures.

This post has been edited by kelvinlym: Oct 4 2012, 08:33 PM

Part 3 will be more successful. We will be back!!

Since the 'investors' can't desecrate the gold bars, pray it's not these

http://www.zerohedge.com/news/2012-09-24/g...gold-coins-here

So banks are in the same league, aren't they?? The Holy Grail of Investment too. Worse still, they now don't even have fractional reserve in their balance! Look into banks P&L, making huge returns using your money and paying u peanuts like 3.25% per year and you say "bravo, safe and sound, good returns"! What an idiot! ....and no complains. Why don't you ask the bank.....hello Mr. Bank,can you show me how you make the money and I want to know why pay only 3.25% PER YEAR. I want to know your Holy Grail of Investment (if they is such a term, my goodness what term is this) strategy.
Their financial statements are reported and you can check them. Use to report that in the newspaper! And nobody care to check, earning lots of money and paying peanuts!!!!!!!!! Your last paragraph is just your assumption......

haha... why so worried, get a densimeter for RM2XX to test all you want, problem solved
http://goldsilvertools.com/

Some of you guys are funny. Now Genneva is already busted. And you still talking about the business model viability ?

For those pro genneva people, please go convince Bank Negara. Your arguments are same old stories already presented many many times here. Nobody is going to believe you except those diehard customers and agents.

For those against genneva people, we already know it is not viable. And those pro genneva people are not going to believe you no matter what you say

Whether it is a scam or not, we need to just wait 14 days and bank negara will announce it. From genneva accounting records, if there are no records of investment or business that generate enough profits to pay hibah, then bank negara will confirm to the customers the company is a ponzi scam. Now it is crucial for the Datuk bosses to convince bank negara they are legit. Otherwise, bye bye genneva

This post has been edited by EddyLB: Oct 4 2012, 09:56 PM

I can't help but laughed at your questions.

1) ask any one like banks how they make money from your deposits, hand you a paper book, and pay you a meager 3.25% per year and own all the big buildings in town. Check out what they own!! If your friends borrow your money from you, you give him a IOU paper then pay you 3.25% and you found out from your deposits with him, he is making tons of money and pay u peanuts like 3.25% PER year, i'm sure u will curse him and say what kind of friend is that!! May be don't, cos you are so satisfied with the arrangement. To trade gold, you don't need a LICENCE. You don't get it??

2) if i know how, i will start one like Genneva.........exactly, no one will share business secrets, why should I?? Then you a gold trader will start one. Please............find out how it is done. Hire an actuary.........let me know if you want the service. It is costly, all banks do that.....check out my previous posts. DON'T ASK STUPID QUESTIONS LIKE TELL ME HOW YOU MAKE MONEY. OUTLINE YOUR WORKINGS....NOBODY WILL ANSWER U. It is obvious. Ask the bank to work out how they decide to pay you 3.25% and not 5.5% when EPF a non financial institution can pay 5.5% per year.........watch out they could scam you money cos your EPF money they put in deposits in bank and only get 3.25% but EPF pays u 5.5% per year.........how can they??? OH......watch out, it is a scam!

The gold is just a camouflage, don't your all see?

A) In the old days, MLM, PONZI etc will collect e.g. RM3000 as membership fees, you have to recruit more to get rebate or commission whatever you wanna name it 10% = RM300. Risk = your initial investment of RM3000 which = 100% gone. This scheme is ban in Malaysia long time ago

B) Nowdays smart guy came with new idea. You buy this gold for RM10 000 i give you a gold bar. The fact is this gold worht only 70%, 30% are mark up . RM10000 you get 2.5% = RM250 this is your hibah so nice. Agent will tell you that don't worry you have physical gold to hold on as collateral, even if they run away you can sell the gold.

Let look it this way,
A) Risk 100% value Rm3000 return 10% =RM300 sound risky huh 100% risk.

B) You will not lose all your money, you can sell the GOLD. Fact is the gold is just 70% worth of the price you bought. So you are risking 30% at least which is = RM3000. Do you feel safer, you got collateral.


Both risk RM3000, both give about the same return. The fact is gold bar option is riskier, assuming they sell you with 30% markup. RM10,000 gold max you can sell to the market at RM7000 if shit not happen. If gold value drop you going to suffer more. If gold value appreciate you lose lesser. People will argue gold price will not drop it will just appreciate, damn it just buy gold keep in the house why fall into this trap if you are damn sure about the gold price appreciation.

Think about if, gold trading is just a cover. No goods transaction is ban in malaysia for this kind of trading.

This post has been edited by kuekwee: Oct 4 2012, 10:25 PM

14 days? confirm ke? then it will not drag so long la as previously thought by some... 3-5 years..

i did not expect it to catch so many forumers attention once the BNM raided the premises ....... all eyes on BNM coming weeks reports card ...... legitimate or not the results will be negative for Genneva (at least for a while) maybe everyone will rush to withdraw their coffin money and this rushing to withdraw force, is the main force to force them close shops early not BNM