Fraudsters may use social media to promote a HYIP website or may encourage investors to use social media to share information about a HYIP website with others.

High-Yield Investment Programs

The Internet is awash in so-called “high-yield investment programs” or “HYIPs.” These are unregistered investments typically run by unlicensed individuals – and they are often frauds. The hallmark of an HYIP scam is the promise of incredible returns at little or no risk to the investor. A HYIP website might promise annual (or even monthly, weekly, or daily) returns of 30 or 40 percent – or more. Some of these scams may use the term “prime bank” program. If you are approached online to invest in one of these, you should exercise extreme caution – they are likely frauds.

Fraudsters may use social media to promote a HYIP website or may encourage investors to use social media to share information about a HYIP website with others. For example, in In the Matter of Srivastava and Kavuri, the respondents allegedly used social media to promote their HYIP website, advertising “huge,” “lucrative,” “handsome,” and “guaranteed” profits with “minimal” risk. They also allegedly encouraged their Twitter followers to “use a referral link and promotional banner on social media, blog, forum, and email to share [the HYIP website] with interested parties.” Additionally, according to the Commission’s Order, they created a Facebook page and YouTube video that promoted the HYIP website and advertised supposed daily returns of 1.5% to 2%.

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