Peruvian Congressman Jaime Delgado warned the public about WCM777, an investment scheme promising up to 300% returns on investments from $399 to $1999. Delgado stated the operation uses classic pyramid tactics, initially paying investors before collapsing when new recruits become scarce.
WCM777, also known as World Capital Market, began recruiting aggressively in Peru. The scheme appears to function for a time. But payments stop once recruiters cannot find enough new investors to sustain the payouts.
"It seems that, initially, the scheme works," Delgado stated in his warning. "However, as time passes and when it is not possible to convince more people to invest, the company stops paying its existing investors. Consumers should be alerted to this business."
This structure mirrors textbook pyramid fraud. No real business generates returns. Instead, money from new participants flows directly to earlier investors. The entire operation fails when recruitment slows.
Delgado's warning follows action in Colombia. That country recently launched a criminal investigation into WCM777, suspending its operations there. This validated concerns about the scheme's legitimacy and prompted Delgado's public alert in Peru.
WCM777 founder Phil Ming Xu has not publicly addressed the congressman's allegations.
Peruvian financial regulators have shown no public action. The Superintendencia del Mercado de Valores, the country's securities watchdog, lists no active investigations or warnings about WCM777 on its website. It remains unknown if the agency has opened any probe.
This warning comes weeks after TelexFree, another alleged fraudulent investment scheme, began marketing to Peruvian investors. Such operations often shift markets after crackdowns, targeting vulnerable individuals with promises that prove false.