HYIPs generally aren’t new, as they are known since decades as a very risky opportunity to make lots of money quickly. Usually they take the investments of people to trade them on financial markets (FOREX, Real Estate, other assets) to gain high profits. They say 1% of these companies are seriously operating, but most of the remaining 99% are scams.
Ponzi is a fraudulent method which works as a pyramid. In such schemes, profit is not made by successful economic investment, but by appealing to new investors and using their investment money to pay existing members. This is all very well and good while the system has a steady stream of new members investing into it but once a slow period is hit, the investments will stop coming in and the whole system will collapse. Sometimes the system organizers do not wait until this has happened and may just cease what they are doing and keep the money which had been invested. Often the investors do not become aware of this until they stop receiving their interest payments as promised.
×