In an attempt to derail the expansion plans of the MMM joint-stock company, the Finance Ministry issued a statement Wednesday warning potential investors not to buy securities issued by the firm.


"It is a preventive strike," said Bella Zlatkis, head of the ministry's securities and financial markets department. "We are doing this because MMM announced it would stir up its activities."


MMM president and State Duma deputy Sergei Mavrodi announced earlier this month his company's plans to expand within Russia, as well as abroad to Great Britain, Germany and the United States, on the same day he declared all MMM shares and tickets issued before Nov. 1 invalid until Jan. 1. The company also launched a new issue of tickets: special paper that MMM developed earlier this year to circumvent Russian regulations on share issues.


At the time, many investors in the reputed pyramid scheme who had previously supported Mavrodi labeled him a crook and burned their shares and tickets.


According to Zlatkis, however, MMM tickets are again gaining popularity. "At present the Russian stock market is being filled with MMM shares, as well as MMM tickets," she wrote in the ministry statement.


"A lot of common people are starting to swallow the bait again," agreed Yelena Chernyshkova, an expert with the Skate-Press Consulting Agency.


MMM officials were unavailable for comment Wednesday.


Zlatkis warned in the statement that none of the tickets had been registered with the Finance Ministry, and had no more worth than "advertising material."


She wrote that MMM had violated Russian securities regulations by issuing the tickets, failing to enter shareholders in its company register, and selling shares and tickets through unlicensed firms." Nonetheless all of the Finance Ministry's legal demands to correct these violations were not fulfilled by MMM employees," the statement said.


Zlatkis told The Moscow Times, however, that the Finance Ministry was unable to stop MMM's activities.


"We have taken away all their licenses," Zlatkis said. "They work illegally. To close them down is the police's business."


The statement reiterated that MMM, which claims to have some 10 million investors nationwide, cannot legally have more than 991,000 shareholders based on its registration documents, and that investors who are not included in the shareholders' register do not have any right to receive income or take part in shareholders' meetings.


"Even shareholders who are included in the register are not guaranteed income on their shares," the statement said.