What Are Some Ways You Can Identify Ponzi Schemes?

Ways to Identify a Ponzi Scheme:

The business model is confusing:

The Ponzi scheme business model can be sold off as a high return scheme. However the real purpose of the scheme is never revealed to a customer.

For example:

Low investment, High Return:

Customers are pulled in by the high return promised on their initial investment. These returns are unrealistically higher that prevailing in the market.

Don’t get cheated by scamsters!

Quick Returns:

Returns are sometimes offered daily, with the total worth of their investment increasing from 1-5% every day or every week. This is more than what banks provide or what can be gained from the stock market.

Commission-based system:

Ponzi schemes offer a certain commission to anyone who introduces a new investor into the scheme. No other investment scheme runs on such a model. If there is a commission involved, it is a Ponzi Scheme.

Scroll down to learn more!

Complaints from previous customers about the business model:

The complaints can range from criticism about late repayment to bad behaviour by operators towards the customer.

Points to remember:

Here are some key takeaways from this section that you should remember.

No investment scheme runs on commissions of introducing a new investor. If there is a commission involved, it is a Ponzi Scheme.
Ponzi schemes never really reveal the actual purpose of the investment and the customers are pulled in by the high return promised on their initial investment.

To track your progress