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|30% Interest a Month Is a Scam, Not a Blessing|
Feb. 6th, 2007 at 4:18 pm
Once again Ponzi schemes are making their way up and down the Wasatch Front. I’m not posting to discuss why it is that Mormons seem particularly susceptible to such scams. I just want to make a few points that seem to bear repeating and discuss a bit of history.
The first point is that a legitmate business that needs money is not going to approach you to get it. There are some exceptions to this rule if you happen to be Larry Miller. But I’m guessing you are not Larry Miller. If you are, please read my post on the renaming of the Delta Center.
Now why aren’t they going to get their money from you and share the wealth? Because if they are legitmate they can go to a bank and get money far more cheaply than the crazy rate they are offering you.
This leaves us with a few possibilities. The most likely is that it is a scam and they are simply taking your money. They might actually be putting it to work though in a venture that a bank might not be willing to fund. Examples are drugs, gun running, and slavery. But all those pay pretty well on their own so odds are that your money is simply being stolen.
When I was a child many people in my ward began investing in a venture that purported to be opening a diamond mine in Africa. A member of the stake presidency’s family was involved and they even had a shiny rock that they would show people. The reason I even remember this is that my dad asked to teach EQ when this started to happen and then gave a lesson on how businesses are funded and why a legitmate businesses don’t rely on networks of friends of friends and relatives to fund themselves. Some people left the lesson intending to pull their money out immediately. Others wanted to know how long they could keep it in safely. The memorable part came later that evening when someone called and threatened to kill my father.
Twenty five years later my father is alive and well but several people in the ward that took equity out of their homes to invest in this scam are less well off than they would otherwise be. One of the scammers fled the country. Others claimed to simply be dupes.
Back in the present day such scams are still prevelant. I heard of one today that hasn’t fallen apart yet, inspiring this post. Several families in Davis County have pulled the equity out of their homes to invest. My advice: Get out now and tell your friends to do the same.