What are some of the warning signs of a Ponzi scheme?

 

A: When friends or family members approach you about a “great investment” that they have discovered, you still need to proceed with caution.  It is easy to follow the lead of the people you trust, but unfortunately, they might also be unknowing participants in an investment scheme.

One of the most common investment scams is the Ponzi scheme, which involves paying returns to investors from their own money or money paid by later investors.

There have been many reported Ponzi schemes recently, some of which have cost investors millions of dollars.  To protect yourself from financial loss, you need to be able to identify warning signs of a Ponzi scheme, which are as follows:

• Promise of an unusually high rate of return
• A guarantee of a specific return on investment is given
• Stated returns appear to be too steady
• Investment seems confusing or complex
• Investing strategy is not disclosed

Forbes.com has even more Ponzi scheme warning signs that you can view.

If you have lost money due to a Ponzi scheme, contact an experienced investment fraud lawyer at our office for a free case evaluation.  Our investment fraud attorneys are licensed in Ohio and Californiaand we represent investors nationwide in securities arbitration and litigation claims.

Contact us by calling 1.866.827.6537 or filling out our online form.