Pyramid Scheme Whistleblower Lawyer
A pyramid scheme can irrevocably damage the financial wellbeing and future of those involved. Help the SEC protect these investors by working with a pyramid scheme whistleblower lawyer.
While securities fraud takes many forms, pyramid schemes are perhaps the most blatantly fraudulent. Unfortunately, these scams do sometimes manage to go undetected for long periods of time, and the longer a pyramid scheme exists, the more investors it will inevitably pull in. When the scam finally collapses, these people will inevitably lose the money they invested.
This is why the SEC stamps out pyramid schemes when they can successfully be identified. If you know of an active scam, the SEC might reward you for calling it to their attention. By working with a pyramid scheme whistleblower lawyer from Meissner Associates, you can expose a scam, help the investors affected, be rewarded, and remain anonymous.
What Is a Pyramid Scheme?
“Pyramid scheme” is a term many people are familiar with but don’t actually understand the full meaning of. In a pyramid scheme, fraudsters convince people to invest, often with some form of offering fraud, such as a guaranteed high return.
In order to recoup the highest return, however, investors must recruit additional investors. The catch is that there is often no real investment. Instead, each tier of investors is paid using the investment of the tier below it.
The pyramid inevitably collapses when it fails to recruit enough investors to maintain the scheme and pay all the tiers.
When Will the SEC Investigate a Pyramid Scam?
Pyramid schemes take many forms, but certain types are of particular interest to the SEC. While some pyramid schemes are built around selling products that have no actual value (such as reports and mail lists), other pyramids are built around “investments” where no actual investing occurs.
This constitutes securities fraud, and the SEC will launch an investigation if it believes it has compelling evidence that the business or investment group is actually a pyramid scheme. The more investors that are likely to be affected, the more likely the SEC is to launch an investigation.
Pyramid Scheme vs. Ponzi Scheme
While Ponzi schemes are often conflated with pyramid schemes, the two aren’t necessarily the same. It’s possible for a Ponzi scheme to be structured as a pyramid scheme, but in most cases, Ponzi schemes lack the hierarchy of pyramids.
Instead, most Ponzi schemes have a central figure at the center who does all of the recruiting (as opposed to having the investors doing the recruiting). Ponzi schemes are more likely to collapse early on as the fraudster is unable to keep up with recruiting enough investors to keep the scam going.
Contact a Pyramid Scam Whistleblower Lawyer
If you believe that you’ve identified a pyramid scheme involving securities fraud, the SEC might reward you for your information. If they recover over $1,000,000 in sanctions, you could receive between 10 and 30 percent of the funds collected.
Let a pyramid scheme whistleblower lawyer from Meissner Associates help you determine how strong your tip is. The evaluation is free and 100 percent confidential—just complete the form below or call 1-866-764-3100.