Ponzi schemes pay earlier participants with new money
Ponzi schemes pay earlier participants with new money
A Ponzi scheme is investment fraud.
New participants’ money funds payments to earlier participants.
Those payments can be presented as genuine profits.
Receiving several payments does not prove legitimacy.
The scheme becomes dependent on fresh inflows.
Reduced inflows can disrupt payments.
Promises of high returns with little risk are warning signs.
Unusually consistent returns also warrant scrutiny.
Vague explanations do not clarify the income source.
A professional appearance does not create a genuine revenue model.