How can I avoid getting wrapped up in a pyramid scheme?

Pyramid and Ponzi schemes have a lot in common, and the way to avoid them is to approach any investment opportunity with a grain of salt. Unfortunately, avoiding pyramid schemes takes a little work on your part. If you’re not sure how to get started, realize that avoiding investment scams boils down to one basic thing: don’t believe everything you hear. Here are some questions you should ask yourself before you hand over your cash:

  • Have I received all of the necessary documents and financial information in writing?
  • Does the information I received in writing match what the promoter told me?
  • Did I check up on the broker’s background and the investment itself?
  • Have I met face to face with the promoter, and have I visited his or her physical office location?
  • Have I been asked to promote an investment or product to my friends and family?
  • Am I being pressured to invest my money before I’m ready?

If your answers to these questions disturb you, take the extra time to really look into the opportunity before you invest your cash. Consider calling in a trusted financial advisor, broker, or securities fraud attorney to look everything over before you make a decision.

If you need help after you’ve sustained losses in a Ponzi scheme, pyramid scheme, or other form of investment fraud, speak with an experienced securities fraud lawyer as soon as possible about your situation. You can reach us by calling or by filling out our confidential online contact form.