17 Nov Avoid scams! (like Ponzi schemes)
This week I will be talking about scams and how you can avoid them. First up the is infamous “Pozi Scheme”
Have you ever been invited to invest in something that seemed too good to be true? There was zero risk, you could double or triple your investment in a matter of weeks, and the source even used impressive-sounding words like “variable hedge fund” and “proprietary international trading methods”? If so, then you probably already know where I’m going with this.
The fact is that a lot of bad guys take advantage of our normal desire to make some money by making impossible promises and giving few details. I’ve talked a little about Ponzi schemes before, but let’s have a look again at the details (as published on dailyfinance.com):
In 1918, Charles Ponzi came up with an idea to buy and sell international reply coupons, which due to high inflation, could be purchased cheaply in his home country of Italy and sold for a profit in the U.S. With promises of 400 percent returns, he formed an “investment company” to expand his still-legitimate scheme. The public dumped millions of dollars into his company but soon the coupons were ignore. Instead, early investors were paid off with money from new investors until authorities uncovered the fraud, shut it down and sent Ponzi to prison.
Was Charles Ponzi a bad guy? Yes. But I also think that those who invested their money with Ponzi are at least somewhat to blame. They believed a promise that was too good to be true and didn’t educate themselves on the nature of the investment.
That should be a lesson to all of us today.
For example, when I sell my real estate investment programs, I try my best to explain the philosophy, legality, ethics, and potential risk of what I do. I answer questions, I provide proof and testimonials, and more than anything I try to make sure that my students get the results they expected. So let’s all learn a lesson from the Charles Ponzi fiasco – if something seems too good to be true, it probably is.
For more info, check out this link: http://www.dailyfinance.com/2014/04/18/top-10-financial-scandals/
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