The real secret nobody told you about Ponzi Scheme is how they operate 


You have probably heard a lot about financial term been thrown Around and one of them is the term “Ponzi scheme

What is Ponzi scheme?

This an Arranged investment that investors are promised low risk and high return. This investment is fraudulent, they are not Actual investments. They finally collapse and investors loose A lot of money a good example of it, is :“ MMM” in Nigeria that commenced sometime in 2016.

For example

Samuel has $6 dollars and a Ponzi schemer comes to Samuel in disguise of an Actual investor with a sugar coated mouth promising double the Amount in a particular period of time if Samuel invests his $6 dollars. Samuel likes Quick money and it sounds fascinating to him , in doubts though, Samuel goes ahead and takes his $6 and invests into this platform.

When the time for return is due, the Ponzi schemer pays Daniel his $12 dollars in full. Samuel Is thrilled by this and he goes over to about fifty of his mates and family members and tell them about this platform and because they know some one very close who has earned from it. They too, will go and invest their money Into this platform. Time for payment? They too are paid in a even more higher rate and that is when the Ponzi schemer gets to earn a good reputation in their eyes and mind you, Each of this 50 people will bring a maximum of 50 more people each into this platform at least and because the schemer said “more referral, more money” they are busy on every social media platform showing screenshots of Bank Alerts, receipt and before you know it.

This platform is populated with hundreds and millions of people giving and investing Tons of money “the higher the investment, the higher the return” they schemer would say.

This is a secret nobody told you: it is a redistribution of money from newer investors to old investors. For example an old investor called Mr. Mike had given a Ponzi schemer $ 100 dollars and goes to the Ponzi schemer in a week or two and say; I want my return. What the Ponzi schemer actually does it take from newer investors and gives that money to Mr. Michael as return.

It’s more complicated in real life but the theory is that, the money gets shifted from newer investors to old investors that how the circle continues because satisfied client are thrilled with returns and the Ponzi schemer maintains his good reputation and that’s how Ponzi schemes sustain themselves.

The pattern continues till the Ponzi schemer stops getting new investors or the new investors are not large enough to sustain the returns of the old investors this happens during an economic down turn or something Abruptly goes wrong and the results are all exposed when the entire scheme collapses .

How to identify a Ponzi scheme when you see it

Companies that run Ponzi schemes concentrate all of their efforts on finding new investors because without them, the scheme will run out of money.

The fraudulent investment scheme’s basic idea is to reimburse the initial backers with money from future investors.

1. When they promise you payment with no service to render (IT IS SCAM!): believe it or not, the only way to get paid is by rendering services to people. Offline or online. There no business in the world that works without rendering Quality services to the masses.

2. Referral is not rendering a service: one of the way to dictate a Ponzi scam is the prioritization of referrals . Referral is not a service I repeat. What you’re doing is promoting their platform to more people so they can get more people like you to scam. You’re Advertising them to your friends and family who Already sees you as someone who is trustworthy. “It is a tactics” your contacts trust you and they will easily follow a platform recommended by you and you can end up loosing people’s trust when things goes south.

3. They ask you to perform simple task: task like: watching their videos and promoting their sponsored posts through paid Ads . What you are doing is, making them a little rich every single time you watch their videos and like earlier said in number (3) by promoting their sponsored videos you are Helping them Advertise their schemes to get them more investors so they can scam them too like you are being scammed ignorantly.

Conclusion

It’s mostly the ones who want to get rich In a split of second that falls into the hands of the schemers more often. There is no Easy money and remember “to get paid requires rendering of service.”

 

 


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