On Friday the Finance Ministry circulated a very long statement, the contents of which could be boiled down to one word: "Danger!"


The statement says that an enormous number of false securities have appeared on the Russian stock exchange.


A slight panic then ensued among the share traders for MMM -- the price of MMM shares faltered and the number of those wishing to sell rose sharply. Among the financial instruments that, according to Russian law, cannot be considered securities are shares of the most popular joint stock company MMM.


The Finance Ministry's statement also says that the issuance of unregistered securities is against the law, and that the advertising and sale of such securities are illegal. This means, the ministry emphasizes, that those who buy such securities cannot count on having their interests protected by the law.


On June 11, President Boris Yeltsin signed a decree "On the Protection of Investors' Interests," in which a number of significant limitations are introduced on those who want to sell their securities on the open market or, in other words, to an indefinite circle of buyers.


In order to offer shares publicly a company must register with the Finance Ministry or with local financial organs. In order to register, the share issuer must offer full information about the company and the share issuance -- volume and any limitations -- to all interested parties.


MMM has not fulfilled any of these requirements, and neither have a number of other companies that advertise and sell their shares.


There are obvious violations of the rules, which means a risk for many thousands of investors; there is a legal basis for suspending the company's activities or for filing a suit against it, but none of this is happening.


When, at the end of April, the Moscow tax police demanded that MMM give it its financial documentation, Sergei Mavrodi, MMM's president, answered with a fairly rude letter. Mavrodi openly threatened the authorities: If they insisted on an audit he would suspend all activities and the government could face the 5 million shareholders. The tax police did not insist on receiving the documents, although it certainly could have sent "inspector Kalashnikov" -- a band of armed police officers -- to MMM, which it has done on numerous occasions with other companies.


If Mavrodi is not exaggerating, then MMM is the largest company in the world in terms of shareholders. The sheer numbers of shareholders explains the overly cautious attitude of the authorities.


MMM produces nothing (or at least nothing is known about it if they do) and it sells nothing except its shares. Earning the fantastic profits that MMM promises (and has, so far, been paying) is impossible for any business, including drug trafficking.


It is likely that MMM's only source of income is the sale of new shares. What happens when this "pyramid" comes tumbling down, when the amount of money going out is more than the money coming in?


The government is already afraid that MMM will fall; if this happens it will be a financial tragedy on a national scale, which means a political tragedy.


But the most dangerous and tragic thing is that MMM already has dozens, hundreds of imitators and there is nothing to stop the number from increasing. It is simply frightening to look into the future from this perspective.