{"id":2777,"date":"2021-01-05T11:07:23","date_gmt":"2021-01-05T09:07:23","guid":{"rendered":"https:\/\/dotnewsconnect.co.za\/law\/?p=2777"},"modified":"2021-01-12T12:33:32","modified_gmt":"2021-01-12T10:33:32","slug":"dont-fall-victim-to-a-ponzi-scheme-in-2021","status":"publish","type":"post","link":"https:\/\/dotnewsconnect.co.za\/law\/2021\/dont-fall-victim-to-a-ponzi-scheme-in-2021\/","title":{"rendered":"Don\u2019t Fall Victim to a Ponzi Scheme in 2021!"},"content":{"rendered":"\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\"><p>\u201cIf it sounds too good to be true, it probably is\u201d (wise old adage)<\/p><\/blockquote>\n\n\n\n<p class=\"wp-block-paragraph\">2021 could well be a bumper year for Ponzi schemes (and their equally evil cousins, pyramid schemes). They flourish in all countries and at all times, but with our pandemic-related economic woes and general disruption we will no doubt provide the scamsters with particularly fertile ground this year.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">And these schemes just never go away. As soon as one collapses or is shut down, it is immediately replaced by a new one \u2013 or more (like the Hydra\u2019s heads, cut off one and two grow back).<\/p>\n\n\n\n<h6 class=\"wp-block-heading\">Who is at risk?<\/h6>\n\n\n\n<p class=\"wp-block-paragraph\">Everyone! It\u2019s not just pensioners and retrenched employees desperate to recoup their 2020 investment losses. Past schemes have counted some of South Africa\u2019s wealthiest and most savvy citizens as victims, the problem being of course that the con artists who originate them are highly skilled at picking their targets and at creating cover stories to make everything seem legitimate. Perhaps most importantly, they are skilled at the social engineering side of it, building trust and credibility in their target markets with endorsements and \u201csuccess\u201d stories.<\/p>\n\n\n\n<h6 class=\"wp-block-heading\">2020\u2019s R9.45bn parting shot at us<\/h6>\n\n\n\n<p class=\"wp-block-paragraph\">There\u2019s often big money involved too. Witness 2020\u2019s parting shot at us in the form of the late-December provisional liquidation of Mirror Trading International (MTI), alleged by its detractors to be a scam (an allegation hotly denied by MTI) and reportedly involving some <strong>R9.45bn worth of Bitcoin and some 280,000 investors from all over the world<\/strong>, lured by promised returns of up to 10% per month. At time of writing MTI denies that it runs a Ponzi scheme or indeed that anything is amiss, plus its website is still up, but a flood of media speculation to the contrary no doubt has investors panicking.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">See also the recent press reports of the Asset Forfeiture Unit\u2019s seizure of R106m worth of assets (11 chunks of land, 5 aircraft and a motor vehicle) linked to a suspected pyramid scheme.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">During the lockdown, another alleged scheme took R42m in deposits from over 230,000 unsuspecting investors.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Stand by for more\u2026and protect yourself and others by knowing the warning signs.<\/p>\n\n\n\n<h6 class=\"wp-block-heading\">Red flags to watch for<\/h6>\n\n\n\n<p class=\"wp-block-paragraph\">See Sanlam\u2019s Infographic below for a summary of how to spot a Ponzi scheme.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">As the infographic suggests, let your watchword be: \u201cIf it sounds too good to be true, it probably is\u201d.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"724\" height=\"1024\" src=\"https:\/\/dotnewsconnect.co.za\/law\/wp-content\/uploads\/sites\/2\/2021\/01\/Picture1-724x1024.jpg\" alt=\"\" class=\"wp-image-2780\" srcset=\"https:\/\/dotnewsconnect.co.za\/law\/wp-content\/uploads\/sites\/2\/2021\/01\/Picture1-724x1024.jpg 724w, https:\/\/dotnewsconnect.co.za\/law\/wp-content\/uploads\/sites\/2\/2021\/01\/Picture1-212x300.jpg 212w, https:\/\/dotnewsconnect.co.za\/law\/wp-content\/uploads\/sites\/2\/2021\/01\/Picture1-768x1086.jpg 768w, https:\/\/dotnewsconnect.co.za\/law\/wp-content\/uploads\/sites\/2\/2021\/01\/Picture1-1698x2400.jpg 1698w, https:\/\/dotnewsconnect.co.za\/law\/wp-content\/uploads\/sites\/2\/2021\/01\/Picture1-1087x1536.jpg 1087w, https:\/\/dotnewsconnect.co.za\/law\/wp-content\/uploads\/sites\/2\/2021\/01\/Picture1-1449x2048.jpg 1449w, https:\/\/dotnewsconnect.co.za\/law\/wp-content\/uploads\/sites\/2\/2021\/01\/Picture1-100x141.jpg 100w, https:\/\/dotnewsconnect.co.za\/law\/wp-content\/uploads\/sites\/2\/2021\/01\/Picture1-150x212.jpg 150w, https:\/\/dotnewsconnect.co.za\/law\/wp-content\/uploads\/sites\/2\/2021\/01\/Picture1-200x283.jpg 200w, https:\/\/dotnewsconnect.co.za\/law\/wp-content\/uploads\/sites\/2\/2021\/01\/Picture1-300x424.jpg 300w, https:\/\/dotnewsconnect.co.za\/law\/wp-content\/uploads\/sites\/2\/2021\/01\/Picture1-450x636.jpg 450w, https:\/\/dotnewsconnect.co.za\/law\/wp-content\/uploads\/sites\/2\/2021\/01\/Picture1-600x848.jpg 600w, https:\/\/dotnewsconnect.co.za\/law\/wp-content\/uploads\/sites\/2\/2021\/01\/Picture1-900x1272.jpg 900w, https:\/\/dotnewsconnect.co.za\/law\/wp-content\/uploads\/sites\/2\/2021\/01\/Picture1-scaled.jpg 1811w\" sizes=\"(max-width: 724px) 100vw, 724px\" \/><\/figure><\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><em>Source: <\/em><a href=\"https:\/\/www.sanlam.co.za\/corporate\/retirement\/Pages\/employee-benefits.aspx\"><em>Sanlam Employee Benefits<\/em><\/a><em>.<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Another possible indicator of a fraud is a promoter with no physical address \u2013 and if you are given a physical address, make sure it is real!<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If your proposed investment is presented as being a part of a legitimate multi-level marketing (MLM) scheme, it may or may not be genuine \u2013 tread very carefully and read \u201cUnderstanding pyramid schemes and multi-level marketing\u201d <a href=\"https:\/\/www.moneyweb.co.za\/financial-advisor-views\/understanding-pyramid-schemes-and-multi-level-marketing\/\">here<\/a> for some pointers.<\/p>\n\n\n\n<h6 class=\"wp-block-heading\">Warn others (including your staff and the \u201cearly birds\u201d)<\/h6>\n\n\n\n<p class=\"wp-block-paragraph\">Please think of passing on this warning, and if you are an employer alert all your staff. These criminals often target workplaces because of the trust factor between fellow employees and colleagues.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Tell everyone not to fall into the trap of thinking that they can be winners by \u201cgetting in early\u201d. Statistically, 88% of \u201cinvestors\u201d lose everything. And, as a number of South African court cases have shown, even the 12% \u201cearly bird winners\u201d must, if sued by a liquidator or trustee, cough up not only their \u201cprofits\u201d but also their initial stakes.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">That\u2019s because a liquidator (\u201ctrustee\u201d in the case of a person or a trust) can recover any monies paid out by a liquidated scheme during the 6-month period prior to liquidation, unless the recipient can prove that the disposition was made \u201cin the ordinary course of business\u201d and without intention to prefer one creditor above another.&nbsp; That\u2019s likely to be impossible to prove with an illegal scheme. Even after 6 months the investor is still at risk, although the onus of proof then shifts to the liquidator.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In other words, even the \u201cearly birds\u201d stand to lose everything.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>So the bottom line is this \u2013 if you are approached by anyone with a \u201ctoo good to be true\u201d deal, don\u2019t part with a cent until you are 100% sure it is legitimate!<\/strong><\/p>\n\n\n\n<p style=\"font-size:12px;margin-top:40px\"><strong>Disclaimer:<\/strong> The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.<\/p><p style=\"font-size: 12px;color: #ccc;text-align: right\">\u00a9 LawDotNews<\/p>\n","protected":false},"excerpt":{"rendered":"<p>\u201cIf it sounds too good to be true, it probably is\u201d (wise old adage) 2021 could well be a bumper year for Ponzi schemes (and their equally evil cousins, pyramid schemes). They flourish in all countries and at all times, but with our pandemic-related economic woes and general disruption we will no doubt provide the [&hellip;]<\/p>\n","protected":false},"author":101014,"featured_media":2778,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[8],"tags":[],"class_list":["post-2777","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general-interest"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.5 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Don\u2019t Fall Victim to a Ponzi Scheme in 2021! &#8226; LawDotNews<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/dotnewsconnect.co.za\/law\/2021\/dont-fall-victim-to-a-ponzi-scheme-in-2021\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Don\u2019t Fall Victim to a Ponzi Scheme in 2021! &#8226; LawDotNews\" \/>\n<meta property=\"og:description\" content=\"\u201cIf it sounds too good to be true, it probably is\u201d (wise old adage) 2021 could well be a bumper year for Ponzi schemes (and their equally evil cousins, pyramid schemes). 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