Headline

Red flags! Seven Ways To Identify A Ponzi Scheme

Published

5 months ago

May 6, 2025

Editor

Investing is one of the best ways to grow your money, but it also comes with risks, especially when scammers are involved. One of the most dangerous and common scams today is the Ponzi scheme.

Contents

1. High Returns with Little or No Risk

2. Not Registered with Any Financial Authority

3. Little or No Information About the Business Model

4. Payments Are Made Using Money from New Investors

5. It Relies Heavily on Referrals and Downlines

6. You Have Trouble Getting Your Money Out

7. It Has a Strong Cult-Like Following

It looks like a normal investment at first, but it’s a trap that uses people’s money to pay old investors, until everything collapses. Here are some ways to identify a Ponzi scheme before it steals your hard-earned money.

1. High Returns with Little or No Risk

One of the biggest red flags of a Ponzi scheme is that it offers huge profits in a short time and claims there’s no risk at all. Real investments always have some level of risk. If someone tells you that you’ll get 40% returns every month with “zero risk,” that’s a lie and a likely sign of fraud.

2. Not Registered with Any Financial Authority

Legit investment companies are registered with government bodies like the SEC in the U.S. or the Corporate Affairs Commission (CAC) in Nigeria. A Ponzi scheme avoids regulation so that it can operate under the radar. Always check if the company is officially registered before giving them your money.

3. Little or No Information About the Business Model

A common trick used by Ponzi scammers is to be vague about how the money is actually made. They may use complicated words like “crypto arbitrage” or “forex auto-trading” without explaining the process clearly. If you don’t understand how the business works after asking questions, it’s likely a Ponzi scheme.

4. Payments Are Made Using Money from New Investors

In a Ponzi scheme, early investors get paid with the money brought in by new investors, not from actual profits. This makes the system look like it’s working at first. But once new investors stop joining, the scheme crashes, and everyone loses their money.

5. It Relies Heavily on Referrals and Downlines

If the company pressures you to bring in more people and promises to pay you based on the number of people you recruit, be cautious. This setup is very similar to a Ponzi scheme. Real investments don’t depend on bringing in new investors to stay afloat.

6. You Have Trouble Getting Your Money Out

When it’s easy to put your money in but difficult to withdraw it, that’s a serious warning sign. Some Ponzi schemes delay or deny withdrawals with excuses like “system upgrades” or “high traffic,” especially when many people try to collect their money at once.

7. It Has a Strong Cult-Like Following

If everyone in the group blindly defends the investment, shuts down questions, and treats the founder like a hero, that’s another red flag. Ponzi schemes often use hype and emotion to trap people.

A Ponzi scheme can happen anywhere, online or offline, in any country or currency. The key to protecting yourself is to stay alert, ask questions, and never be in a rush to invest.

Headline

Welcome Home, Israel Confirms Return Of 20 Hostages From Gaza

Published

15 hours ago

October 13, 2025

Editor

Israel said that the last 20 living hostages released by Hamas on Monday had arrived in the country.

“Welcome home,” the foreign ministry wrote in a series of posts on X, hailing the return of Matan Angrest, Gali Berman, Ziv Berman, Elkana Bohbot, Rom Braslavski, Nimrod Cohen, David Cunio, Ariel Cunio, Evyatar David, Guy Gilboa Dalal, Maxim Herkin, Eitan Horn, Segev Kalfon, Bar Kuperstein, Omri Miran, Eitan Mor, Yosef Haim Ohana, Alon Ohel, Avinatan Or and Matan Zangauker.

AFP

Headline

20 Members Of Gang Blacklisted By US Escape Guatemala Prison

Published

17 hours ago

October 13, 2025

Editor

Twenty members of a gang designated a “foreign terrorist organisation” by the United States have escaped from detention in Guatemala, a prison chief said Sunday.

The members of the Barrio 18 gang “evaded security controls” at the Fraijanes II facility, prison director Ludin Godinez said at a news conference.

He received “an intelligence report” on Friday warning about the “possible escape” from the prison, which is southeast of the capital, Guatemala City.

Godinez said they were investigating possible acts of corruption.

Washington last month blacklisted Barrio 18, an El Salvador-based gang which has a reputation for violence and extortion, as part of its crackdown on drug trafficking.

The US embassy in Guatemala condemned the prison escape as “utterly unacceptable.”

“The United States designated members of this heinous group as the terrorists they are and will hold accountable anyone who has provided, provides, or decides to provide material support to these fugitives or other gang members,” the embassy said on X.

It called on the Guatemalan government to “act immediately and vigorously to recapture these terrorists.”

According to Interior Minister Francisco Jimenez, there are about 12,000 gang members and collaborators in Guatemala, while another 3,000 are in prison.

The country’s homicide rate has increased from 16.1 per 100,000 inhabitants in 2024 to 17.65 this year, more than double the world average, according to the Centre for National Economic Research.

According to the Salvadoran government, the gangs Barrio 18 and Mara Salvatrucha, better known as MS-13, are responsible for the deaths of about 200,000 people over three decades.

The two gangs once controlled an estimated 80 percent of El Salvador, which had one of the highest homicide rates in the world.

Headline

South Africa Bus Crash Kills 40 Including Malawi, Zimbabwe Nationals

Published

17 hours ago

October 13, 2025

Editor

At least 40 people, including nationals of Malawi and Zimbabwe, were killed when a passenger bus rolled down an embankment in South Africa, a provincial transport minister said Monday.

The bus travelling to Zimbabwe crashed around 90 kilometres (55 miles) from the border on Sunday after the driver apparently lost control, Limpopo province transport minister Violet Mathye said.

“They are still working on the scene, but 40 bodies have already been confirmed to date,” Mathye told the Newzroom Afrika channel. The dead included a 10-month-old girl, she said.

Thirty-eight people were in hospital and rescuers were searching for other victims, she told eNCA media.

The bus was travelling from the southern city of Gqeberha, around 1,500 kilometres away, and its passengers included Malawians and Zimbabweans who were working in South Africa. The crash may have been caused by driver fatigue or a mechanical fault, the minister said.

South Africa has a sophisticated and busy road network with a high rate of road deaths, blamed mostly on speeding, reckless driving and unroadworthy vehicles.

AFP