The Economic Crime and Corruption Unit (ECCU) of the Ontario Provincial Police (OPP) Anti-Rackets Branch is alerting citizens to an ongoing investment scam in the Hamilton and Burlington areas. The ECCU is currently investigating a Ponzi-type private lending scheme where investors are issued promissory notes.
When investing, be aware of the following indicators of a Ponzi scheme:
- Sounds too good to be true. – e.g., Claims of a never-ending pool of short-term, high-interest rate borrowers.
- Promises of low risk or high rewards – Promoters of Ponzi schemes typically promise implausibly high or quick returns with little risk. Any guarantee that an investment will perform in a certain way is a signal that it might be part of a Ponzi scheme.
- High-pressure sales tactics – Reputable investment firms and agents do not push potential investors to act immediately, and legitimate investment opportunities are rarely time-sensitive.
- Pressure to reinvest – Often fraudsters keep Ponzi schemes alive by convincing investors to reinvest their profits rather than take a payout.
- Lack of transparency or access – Secrecy surrounding the operation of the financial company should be an immediate warning sign. If the schemer can’t or won’t provide verifiable sources of capital, equity, or collateral then be wary of investing.
The OPP encourages anyone who feels they may be a victim of an investment scam to contact their local police service to report the crime AND report it to the Canadian Anti-Fraud Centre at 1-888-495-8501 or online using the Fraud Reporting System (FRS), even if a financial loss did not occur.
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Fraud schemes like sales or proposed investments in bit coin related shares guaranteeing automatic returns as promised by BitMarket-Capital and others, whose businesses are not registered provincially or federally, and whose representatives are not qualified or licensed stock brokers or salesmen. They have no office locations and operate under only a dot com address are difficult to get money lost returned, and can only be traced by their phone numbers and personal credentials. They should be reported to the securities and Exchange of Canada and the province. They steal identity and then use that, to scam bank account Interac payments that cannot be reversed and are not covered by bank security.