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Why Are Ponzi Schemes So Prevalent?

The Ponzi scheme has been around for a long time, even before its namesake pulled off his famous 1920’s scam. Although it has always been a popular way for fraudsters to take your money, it has seen a huge surge in recent years. What factors are present in the current economic climate to make the Ponzi scheme such an attractive and dangerously successful scheme?

Looming Retirement

As a large population of baby boomers ages, those nearing retirement are realizing their nest egg may not be enough to cover their needs after the age of 65. Ponzi schemes targeting people of retirement age are rampant because they “promise” such fast, steady returns.

Worries About Safety and Stability

Along those same lines, people who are able to save a little money want to put it somewhere where it will safely grow. Ponzi schemes give the appearance that it is truly what it claims to be, as investors up the ladder start to see immediate benefit. The scammer "promises" high returns, giving the illusion of safety and abusing your trust.

Relying More on Friends & Family

Because the market is flooded with investment options, and because so many inexperienced investors are looking for opportunities, many people are turning to their friends and communities for advice. Called “ affinity fraud,” fraudsters are able to use that trust and desperation to their benefit, sometimes wiping out the life savings of entire church congregations or families.Ultimately, you should always be on the lookout for an investment opportunity that seems too good to be true, and be wary of ANYONE who claims they can "promise" you a huge return. If you have lost money in a Ponzi scheme, an experienced attorney can help explain your options. Meyer Wilson represents investors nationwide, and may be able to assist you. Contact us today.

The information contained in The Firm’s posts on its blog, fraud alerts, investigations or elsewhere on the site is based upon information obtained from other sources including, but not limited to, news outlets and federal, state, and regulatory agency filings. All suspects and subjects of postings herein are presumed innocent until proven guilty in a court of law or administrative action and any and all crimes are alleged until a court or regulatory agency finds otherwise .

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