Investors in Russia's largest investment fund said Monday they knew MMM was operating a giant pyramid scheme that must in time collapse but as a fourth panic in five months subsided outside the company's Moscow offices, most shareholders said they were staying in the game.


"Aren't you playing?," asked Vladimir, 55 an economist who said he had been investing in MMM shares since March. "Why not? It will last, at least for a while."


MMM claims to have some 10 million shareholders and runs more than 60 offices in Moscow and another 76 offices in 49 cities throughout Russia. The company's shares have become the country's most-traded security largely due to an aggressive advertising campaign and the extraordinary returns offered.


But for the fourth time in five months a tremor of panic struck investors over the weekend. Thousands of investors rushed to sell their shares after the Finance Ministry issued a statement Friday saying that some MMM securities were illegal and tax police announced Thursday that MMM division Invest-Consulting had failed to pay 49.9 billion rubles ($24.3 million) in taxes and fines.


By Monday, however, as an armored van pulled up to an MMM office in downtown Moscow, only a dozen investors rushed in to sell their shares, which have risen in value to 105,000 rubles from 1,600 rubles in February. Others chose to stay in the game.


"They are already signing up on a list to sell shares tomorrow, when we'll buy for 115,000 rubles, 10,000 more than today," said the office's manager. "And tomorrow most of them will change their minds and won't sell."


Company officials are very secretive about MMM's operations, though some have said the fund earns money by speculating on currency markets, offering short-term credits and investing in stocks. No official spokesmen for MMM could be reached for comment Monday.


The branch manager, however, while asking not to be named, admitted that the company was running a pyramid scheme, in which high returns on investments are paid primarily with revenues from the sale of more shares. Once new investors stop coming, the entire edifice collapses.


"Other countries, the Baltics and Belarus in particular, are about to enter the game, as far as I know," the manager said, adding that daily turnover at his office alone had reached 5 billion rubles.


He expressed confidence that the weekend panic, the fourth in five months, would calm down completely within the next two days.


"We've been buying 35,000 shares daily since last Thursday," he said. "But we have enough money to buy several times more. This is a regular panic and it is almost over."


He said that MMM was issuing new "tickets," which entitle the holder to a fraction of one share, to "build the pyramid from its bottom."


The Finance Ministry issued a statement Friday saying that the tickets represented an unregistered security and were thus illegal. The Anti-Trust Committee announced that it had rejected a request from MMM to increase its charter capital in order to issue another 1 trillion rubles in shares.


The MMM manager, however, said that Russian securities law was vague enough to allow the company to continue issuing its tickets in lieu of a new share issue.


So far, the government has authorized MMM to issue only 991 million rubles face value in shares, though officials believe that the company has already far exceeded that limit.


An official at the Finance Ministry said the government was unlikely to close MMM down, since the company has already grown too large and well-known.


MMM president Sergei Mavrodi himself has warned of the social backlash that could ensue if the company folds."I personally would not forecast what concrete shape the anger of the robbed people will take: a revolution, a civil war, or something else," Mavrodi wrote in a letter to tax officials, part of which was published Thursday in Rossiiskaya Gazeta.


Private investors in MMM acknowledged Monday that they were aware of being players in a pyramid game, but were optimistic about their prospects for the next several months.


"Yes, it is the fourth panic, or wave as we call it, since March," said Vladimir, who stood in a small crowd outside the downtown MMM office. "We come over here, talk, see what happens and react when it is necessary."


Dmitry, 25, a student who invested less than 100,000 rubles in the MMM shares in March, said he currently owns 7 million rubles worth of shares. "I'm going to keep my shares for some more time," he said.


Anna, 49, a school teacher, said that investing in MMM was the only way her family of four could make ends meet.


"My husband, a retired army officer, earns about 120,000 rubles a month and I make another 80,000," she lamented. "How can you possibly survive on this money without trying your luck?"