Investment Scams - Be warned, beware [MERGED: FrancSwiss]

[wildthing]

A friend of mine is into paper trading, he shared me some current scams in the paper trading business for warning. I thought I might need to share these info:

Someone inquired about FRANCSWISS. It is a scam. I thought I should share some blogs about scams with you. Here we go.

From Wikipedia under "Ponzi Scheme":
http://en.wikipedia.org/wiki/Ponzi_Scheme

Quote:
In October 2006, in Malaysia, two prominent members of society and several others were held for running an alleged scam, known as SwissCash or Swiss Mutual Fund (1948) . SwissCash offered a returns of up to 300% within a 15-month investment period. Currently, this HYIP investment is offered to citizens of Malaysia, Singapore, and Indonesia. It claimed investors' funds were channeled to business activities ranging from oil exploration to shipping and agriculture in the Caribbean. The company claims to be operating out of a New York and incorporated in Commonwealth of Dominica.[5] [6] [7]

This is a warning to everyone. These goons are active in the Metrowalk area (Bullfrog cafe) or any prominent internet cafe location. They use internet cafes as "trading floors" for their racket. They target middle class yuppies with the lure of high returns--even quoting the performance of stock markets/forex markets for their cause.

Please do not fall for it. If you know anyone who is a current "victim"--advise them to get their money out immediately (if they can). Please help curb this nasty practice. Ponzi schemes appear during bull markets.

Previous similar scams include:
1. Multitel Investment Corp (not related to the stock)
2. G Cosmos Marketing
3. Kendeigh Foreign Exchange
4. Grand Post International
5. Mateo Investment Group

SMFUND is the "older" incarnation of Francswiss. They had some of their members post advertisements in ebay.ph trying to get people who are looking for quick money to join in. It is not related to SM Fund of Henry Sy grp.

A cardiologist called Dr. Lynne Rivera, formerly of of Makati Medical Center (she is about to be kicked out of there) is another person to watch out for (says an acquiantance) - and her "First Domain" supposed finance company which closed down.

Another blog post: "guys there is a new one: Equitrust FX International Corp. its address Suite 709 Manila Bankers Building. Ayala Avenue, Makati. 5% interest a week and take note $200K ang investment mo! alam nyo guys yun person behind this company as far as i know ay may mga previuos ventures na talagang questionable! ang pinagtataka ko hanggang ngayon d pa rin cla nahuhuli!"
In case memories are short:

Kendeigh Foreign Exchange (c. 2002)
http://www.offshorebusiness.com/mess...=5577&page=123

Mateo Management Group and other ponzi scams
http://www.mlmwatchdog.com/3_MLM_Philippines.html

G Cosmos of Japan (remember that Japanese dude who put large billboards on Edsa? Claiming to want to "help the Filipino people"?)
http://www.iht.com/articles/2002/03/30/mjapan_ed3_.php

SEC Brochure on "Investment Scams"
http://www.sec.gov.ph/advisory/SEC%2...y,04182002.pdf

More history lessons:

This was Rose Baladjay's Mutitel Investment Corp:
http://money.inquirer.net/features/p...1&dd=11&file=1

It's always the same story of these fraudsters. Once they get a good thing going, they go nuts and start spending their money like Babylon. If it looks too good to be true, it probably is.

Courtesy of Mark T Market:
To be fair, I think the common practices deserve a brief discussion.

MLM/Network Marketing

We begin with Multi-Level Marketing (MLM), which is actually a legitimate business model. The original premise of MLM is to build a performance-based business model by building incentives on two levels: 1) product selling and 2) agent recruitment (hence multi-level).

Product selling incentives are in the form of "overrides"--meaning if an agent sells a product, not only is the agent provided a commission, but the agent's recruiter also gets one. This practice is very common in pharma, applicance and real estate sales. Through "overrides" agents are also encouraged to recruit other agents to benefit from their Network.

The other level is when new or prospective agents pay a membership fee to sell a product. This is the same concept as "franchising" where you pay the person owning the franchise for the permission to market their product. Through franchising, a new level of incentives was created, since now existing agents could get a commission for getting new ones by being paid a cut from the franchise fees.

It is on the franchising side that the abuse starts. Since the franchise fees can be substantial and are paid upfront, it oftentimes earned the agents more money to get new recruits than to encourage their existing network to sell the product. The business model is now turned upside down as new recruits are hired to get more recruits and so on.

Now a recruitment based incentive business is lopsided--since it only relies on money from new recruits to earn. The business earns only as fast as new agents get in. Should the existing network stop, only the earnings dry up--and no one loses anything, although the newer recruits will have less value for their franchise fee since they were not able to benefit for the same amount of time as their recruiters.

But the next abuse happens when recruitment is based on the promise of future returns.

Ponzi/Pyramid Schemes/High Yield Investment Programs

You'll know a multi-level marketing business has turned into a pyramid scheme when the company and the recruiters are promising to pay you a guaranteed return on your franchise fee/investment.

By creating a promissory liability this imposes unfair economics on an already lopsided business model. Now the network HAS to get new recruits, or it will default on its obligations--which were the original reason why the network grew in the first place. Once the new recruits dry up, the payments stop, and unlike a franchise, investors in a pyramid scheme are given the option to withdraw their money (it's just like an investment after all). And when the principals are withdrawn, this creates further pressure on the network, until it eventually collapses.

Strictly pyramid/ponzi schemes don't really say upfront that the money they will be paying you will come from the principal of the next investor. However, there are also common occurences of pyramid/ponzi schemes combine with MLM methods and advertising by giving you an incentive for getting newer investors. In both cases, the money still comes from new recruits.

Fraudsters

The final leg of abuse is by the owners of these companies themselves. Especially in the case of ponzi pyramids, which as discussed are already unstable by the sheer economics of it all, the owners are often aware that their good fortune isn't there to last, so they further complicate things by spending the principal money themselves. And spending company capital for personal reasons is a bad thing for any business, legitimate or otherwise.

Testing

Just ask one question to check if "the next big hit" is a ponzi scheme or not:

Does this business earn from anything else apart from new recruits (whether up front or by referral)?

In strictly pyramid/ponzi schemes, it may be difficult to figure out that they are just robbing Peter to pay Paul--so just think: if they can afford to pay me this much, they must be investing it in something that can pay more. And if it's a 100% return per month (or something outrageous to that effect), better try to figure out what kind of business in the universe of capitalism can effect such returns consistently and legally. If you can't think of anything, stop trying to justify it.

BE VIGILANT PLEASE.

[Lucius]

Nung sinabi ko to sa friend ko na scam yan. Sya pa galit hahahahaha. Tapos sabi ko ingat lang at ipull out mo na ang pera mo habang maaga pa. Bumalik na daw pera nya sa kanya... $45/day daw. Eh inask ko if 100k ba ang pinasok nya, oo daw - mag 1 month pa lang. Pano nya mabawi yung 100k eh $45 x 30days x P45+ = wala pang 100k. Pati ba naman ako lolokohin...........

Dapat sa mga nag-FrancSwiss dito satin ipa-XXX and Imbestigador.

EDIT: Isa pa yatang technique un ng mga network scammers, ung ipafeel sayo na sayang at parang nagtatampo sila para mapilitan ka na mag-join. Dapat dito "RECLUSION PERPETUA" or i-electric chair hehehehe. Para di na makaloko ng madaming tao. Lalo na ung mga "PIONEERS" na sobrang yayabang pag tumba na ung networking tambay na lang sa bahay.

[empy]

nasan na yung nag-aalok ng Francswiss dito sa tsikot nung isang araw? :evillaugh

and that other dude that said you would make 3% a day :hysterical:

[B2Bomber]

as they say, if it's too good to be true, it must be false...hehe

good thing I ran into this article, gotta warn some friends... thanks for the info

[B2Bomber]

double post...

[Lucius]

nasan na yung nag-aalok ng Francswiss dito sa tsikot nung isang araw? :evillaugh

and that other dude that said you would make 3% a day :hysterical:

Baka na-electric chair na ni misis, hehehe

[Syuryuken]

Hintay-hintay ang ako ng babarahin ko alam ko may biglang susulpot sa mga susunod na araw.

[oldblue]

EDIT: Isa pa yatang technique un ng mga network scammers, ung ipafeel sayo na sayang at parang nagtatampo sila para mapilitan ka na mag-join.

totoo nga yan. mayroon ako kababata dati na-meet ko ulit sa malls after so many long years of long time no see. exchange cell numbers pa kami. one time tumawag sa'kin, san daw ba office ko para lumabas daw kami.

instead na magkwentuhan about our lives, eh networking pala ang pakay. I casually rejected his proposal. akalain mo ni hindi man lang ako inimbita sa wedding nya na 2 months after. sa dyaryo ko pa nalaman. nun magkasama pa naman kami nun HS, nagbibiruan kami ng sya bestman ko at ako bestman nya

bad trip yan networking/pyramiding schemes. if you value friendship a lot, wag nyo ibebenta yan sa mga kaibigan nyo. delikadesa na lang

[tawengo]

this is so timely! my father is into SM FUND. ma print ko nga to at mapabasa sa kanya.. thanks for the info..

[shotokan]

Dapat sa mga nag-FrancSwiss dito satin ipa-XXX and Imbestigador.

isumbong mo kay Ben "BITAG" Tulfo... para matuldukan na yan!

[basti08]

my cousin is a member of this. my aunt and my mom joined yesterday. ok naman. nakakuha na kme (sa account ng pinsan ko, minimum lang ang nilagay nya $1000) ng $400 out of her 9days of membership. ayos pa naman in so far. we know that this is going to be a scam but for sure its not gonna be soon. bago pa lang kase e. im thinking of joining too. pero pag nakabawi bawi na muna. and i dont plan to stay for too long, say 2 or 3 months max.

[alwayz_yummy]

so from this, i could say HERBALIFE can be considered as MLM..ganun kasi ang structure nila,e...

[box_type]

a friend of mine lent me his user id in SmFund and i found out that your $1000 will earn you 3% per day, that's $30/day for 100 days, so that'll be 30x100 = $3000..! and after which, your investment will mature and you'll have to reinvest again or top up your investment or something like that.

Aside from this, you also have (i think) 3 more ways to earn more! and one way is by (you guessed it right!) recruiting more investors!;

di ko na po matandaan yung ibang detalye pero everytime magkita kami ng friend ko dami nya lagi pera pinapakita sakin as in hundreds of thousands of pesos! kasi dami na nya na-recruit! at eto ang malupet, kagagaling lang niya ng Hongkong and China last week! all expenses paid by SmFund kasi daw nareached nya daw yung incentive quota or promo something, hmmm...kakaengganyo talaga! wha'dya think guys..?

[badsekktor]

A High Yield Investment Program, or HYIP, is a type of pyramid scheme normally offered via the Internet. HYIPs typically accept deposits as low as $1 while promising astoundingly high returns..

Online HYIP schemes rarely last for the long term. Overwhelming number of cases suggest that HYIPs are Ponzi schemes, in which new investors provide the cash to pay a profit to existing investors, which they typically then withdraw.[citation needed] This approach allows the scam to continue as long as new investors are found and/or old investors leave their money in the scheme, known as compounding (because even higher profits are promised).

The introduction of e-currencies has made it possible for HYIPs to operate on the internet and cross international boundaries, and to accept large numbers of small investments. HYIPs usually accept deposits by either e-currency, like e-gold, e-bullion and INTGold, or use specialist third party payment processors like AlertPay, SolidTrustPay, CEPTrust, TriStarMoneyChangers and StormPay. HYIPs typically offer a significant incentive commission (for example, 9% of invested funds) for members to attract and refer new investors.

Most HYIPs disclose little or no detail about the underlying management, location, or other aspects of how money is to be invested, and relatively little information (other than asserting that they do various types of trading on various stock and other exchanges) on how they actually generate the returns they purport. They are sometimes presented with some form of an emotional appeal, appeals for faith, and promises that they will help investors achieve financial freedom.

Arguably, the largest HYIP scam that has existed on the internet was PIPS (People in Profit System or Pure Investors)[1][2]. The investment scheme was started by Bryan Marsden in early 2004, (according to the Wayback Machine record of http://pureinvestor.com) and spanned more than 20 countries. PIPS was investigated by Bank Negara Malaysia in 2005 which resulted in Marsden and his wife being charged in a Malaysian court with 97 counts of money laundering involving more than RM77 million - US$20 million - (copy of New Straits Times article dated 11 Oct 2006). Even after these charges were brought forth many of Marsden's followers/investors continued to support him and believe they would see their money some day. This behavior and denial could be seen and still is seen on hyip forums such as Talkgold Forum and others.
Contents




Interest rates

HYIPs typically claim to offer interest rates of 1% or more per day on invested funds; some claim to offer much higher daily rates exceeding 200% a day. Allegedly, the highest-return HYIP on record has offered 1,100% ROI in one day. Claims of astronomical returns without large capital outlay or background information are indicative of a Ponzi-structured HYIP program.

As a comparison with a typical 1% per day claim, Warren Buffett, one of the world's most successful investors, made around 30% per year during his most successful period; that is on average, less than 0.1% per day. As the claimed returns of 1% per day are extremely unlikely to be produced legitimately, all HYIPs are therefore likely to be Ponzi schemes, and so most investors will in due course lose their money.

HYIP games

As a result of online forums and monitoring sites which have made HYIP investors more aware of their nature, a different sort of "honest" HYIP began springing up in the early months of 2006. Basically, the HYIP owner calls his or her program a "ponzi-structured game" where one should "not invest money one cannot afford to lose", and where there is "never a guarantee of earnings or refunds". They promise to pay out up to (for example) 95% of deposits, the rest going to hosting or other fees and the owner's profit.

In such "games", the first participants ("investors") may make a good profit and are encouraged to refer other people to the program because of referral commission, the fact that they have already made back their principal and are playing with profit, and that the more people who deposit money, the more money can be paid out to participants. In theory, strategies can be developed to maximize profit using these games (but, of course, since this is a zero-sum game, such strategies work by taking advantage of ignorance or errors by others). Some forum users may gain a reputation whereby others will trust their word that they have been able to withdraw their profits, encouraging others to invest in the hopes that more will invest after them and that they can therefore make a profit. As these games are by definition Ponzi schemes, it is inevitable that the vast majority of investors who are not at the top of the pyramid will lose their money.

These "games" might be considered as lotteries. However, the odds of winning cannot be determined, as one cannot know whether one is playing early enough to win money (that is, whether a sufficient number of new participants will follow). Thus, these activities are unlike a lottery or other forms of gambling, where a player has an equal chance of winning no matter when a ticket is bought, or where the odds of the game are known.

HYIP monitors

HYIP monitors, or HYIP listing/rating sites, are websites that list and/or promote HYIPs for referral commissions. The monitor charges each HYIP a listing fee which is usually then invested into that program, although there exist free listings and occasionally monitors which invest their own money. The monitor then labels the HYIP as "Paying" or "Not paying/Scam" depending on whether interest is received within the terms specified by the program. Monitors also allow other HYIP investors to rate and comment on the programs, based on factors such as promptness of payouts and responsiveness of the HYIP administrator. Programs with higher ratings achieve higher rankings on the monitor sites, which coupled with a "Paying" status may entice more investors who rely on the monitor.

In most cases, HYIPs only pay monitor sites to keep their "Paying" status visible, but do not pay other investors. As HYIP monitors are not affiliated with the HYIPs themselves, they are unable to prevent investors from being scammed; they neither help to recover lost funds nor track down the scammers. Promoting or perpetuating Ponzi schemes is a criminal offense punishable by jail terms or fines in most countries. That the monitor sites place disclaimers saying that they "do not promote the programs advertised on their website" does not absolve them from criminal liability.

In order to generate a "paying" status early (so that future visitors will see it) and maintain it for the longest possible time, newly opened HYIPs list their site quickly as well as constantly pay monitors their interest on time. Added to the fact that many monitors invest the listing "fee", and that a commission is received on each deposit made by people who visit the HYIP via the monitor, they are the most likely to profit when a program runs out of funds.

HYIP owners can manipulate monitors and forums, by paying people to comment positively or by using a range of IP addresses or proxy servers in different locations so that "paying" votes appear to come from around the world. This allows the HYIP to rise up the rankings more quickly than others, giving investors a false sense of security. Additionally, even if they know it will scam in the future, some investors will also rate new HYIPs positively until the HYIP stops paying, because they want more people to invest after them in the hopes that the program will last longer. Future scammers can also build up a good reputation on forums for a large payoff once most forum members trust them.

HYIPs indicted or under investigation

The following is a list of HYIP scams that are currently under investigation or have been successfully indicted in a court of law.

* 12DailyPro Autosurf (United States) - US Securities & Exchange Commission
* Ginsystem Inc. (Singapore) - Commercial Affairs Department of Singapore
* IT4US (United States)
* OSgold (Australia) - news.com
* PIPS (Malaysia) - see top of page
* PlexPay (Norway) - HegnarOnline, in Norweigan
* Solidinvestment (United States)
* Studio Traffic / Studiopay (FBI, NYPD, United States)

[Syuryuken]

Heto mag isip-isip muna


Shot at 2007-07-03


Shot at 2007-07-03

[Syuryuken]

Shot at 2007-07-03



Shot at 2007-07-03

[Lucius]

Just saw it sa TV Patrol. Oh ngayon wala na sigurong mangungulit and ipagpipilitan na OK tong bogus scheme na to ha?


Hahahaha ewan ko lang kung magtext pa ung mga kilala ko na sinabihan kong scam yan and nagalit =)

[chua_riwap]

[SIZE="5"]Genghis nasaan ka?[/SIZE]

[BlueBimmer]

kita ko rin kanina sa tv patrol, wala daw pinagkaiba sa pyramid scam ahahahaa

[LexTer]

nasan na yung yumaman dito daw?