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Investment & Crypto

Investment, Ponzi & Securities Fraud

Promising high or guaranteed returns while using new investor money to pay earlier participants (a Ponzi), or making material misrepresentations about securities, crypto platforms, or private deals.

01 — How it works

  1. 01

    Pitch

    Promise high or guaranteed returns to early investors.

  2. 02

    Pay

    Use new deposits to pay earlier investors.

  3. 03

    Scale

    Recruit aggressively on the strength of 'results.'

  4. 04

    Collapse

    Withdrawals exceed deposits and the scheme fails.

02 — Lifecycle

From first contact to detection.

  1. Pitched

    The opportunity is sold on promised returns.

  2. Funded

    Early investors are paid to build trust.

  3. Expanded

    Recruitment accelerates on apparent success.

  4. Collapsed

    The scheme runs out of new money.

03 — Common variants

  • Ponzi schemes
  • Affinity fraud
  • Crypto investment fraud
  • Pig butchering

04 — Statutes & penalties

18 U.S.C. § 1343 (Wire Fraud); Securities Act and Exchange Act violations

20–30+ years is common in significant cases; the largest have drawn 150 years. The SEC also pursues lifetime bars and heavy civil penalties.

05 — How people are drawn in

Aggressive social proof, testimonials, and pressure to act quickly or bring in others, often inside trusted social or religious circles.

06 — Examples

  • Affinity fraud that targets specific communities with 'exclusive' opportunities.
  • Fake crypto or forex platforms that show paper profits until withdrawals are requested.
  • Private-placement or promissory-note schemes with no real underlying business.