The “D” Division Financial Integrity Section continues to receive complaints regarding Ponzi schemes operating in and around Manitoba and would like to remind potential investors to be vigilant.
In a Ponzi scheme, investors are lured in with the promise of a high return over a brief period of time.
The pitch often involves an opportunity to buy into a non traditional investment with zero risk and a guaranteed return.
If an investor actually receives a return it is paid from their own money or money paid by subsequent investors, rather than from profit. This provides an appearance of legitimacy.
In this type of scheme there is often little or no documentation provided to the investor. The scheme falls apart when investors begin to ask for their money back and learn it has disappeared.
