HYIP Scams – What You Should Know?

As the world becomes increasingly digitalized with each passing day, the emergence of fraudulent entities has also risen exponentially. One particular type of scam that everyone should hence know about are HYIPs, also referred to as high yield investment programs. These have been popping up with a much higher frequency lately, and so what better time than now to talk about what these are as well as how to identify such schemes.

Keep in mind that this article will be talking about high yield investment programs and not high yield bond investments. Many people tend to get confused between the two, which is rather unfortunate as the former is a type of fraudulent scheme, whereas the latter is actually often considered to be genuine and legitimate.

What is HYIP?

In simple terms, a high yield investment program refers to a kind of scheme that involves the taking of money from various investors. The investors in question are told about amazing opportunities to earn fantastic returns on their respective investments, with promises being made of potential yields of over 100% being attainable. Not only should such high yields already trigger warning signs, but they should also make you cautious because this is a lot of money that is theoretically being talked about, and that increases the chances of fraudulent activities taking place.

Moreover, an HYIP would also normally include the utilization of funds taken from the abovementioned investors in order to pay off the other investors. In other words, the scheme would take the money from new people who had made the investments in an attempt to then pay off the original investors. This essentially transforms the HYIP into that of a Ponzi scheme.

How to identify an HYIP

Now that you know what an HYIP is, there are a few ways through which you can identify one. Firstly, always be wary about anything that sounds too good to be true because it most likely is. This involves schemes that promise amazing guaranteed returns, such as the aforementioned high yield investment programs.

Additionally, always conduct a thorough background check of the entity that you are dealing with. Check the company’s history, legal status, customer reviews, product reviews, and anything else that you can find. Lastly, always make sure to do your own research regarding any potential investment opportunity. If you feel like something is missing or does not add up, then you should most probably not get involved. Remember, HYIPs may often seem genuine, so please do all you can to be safe.