High Yield Investment Programs Scams
By WORLDLawDirect  [December 20th, 2008]

High Yield Investment Programs (HYIPs)

High Yield Investment Programs (HYIPs) are all over the Internet, and while it's possible that some do make a little money, normally they are illegal scams. An HYIP would typically promise ridiculous returns as high as 50% a month or more. If you have done any traditional investing (stocks, bonds, options, etc.), then you know that even 50% a year is extremely difficult to attain. Any investor should be very suspicious of an opportunity that offers such a return.

It is often said that many HYIPs are complicated systems based on Ponzi schemes, where the returns provided to existing investors are paid out by the investments made by new investors who join the program. This type of scheme does not create any real value or wealth, and therefore, it eventually falls apart, usually within a few months, or a year or two. If you do not pull your funds out early, you stand to lose all your money.

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See also...

Q & A: Money Frauds and Scams




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