A High Yield Investment Program (HYIP) is a fraudulent investment scheme that aims to generate extremely high returns in excess of 100% on investments.
Most HYIPs are Ponzi schemes, where the organizers take money from new investors to pay out profits to regular investors.
HYIPs, often referred to as “big bank scams”, are usually associated with the alleged trading or issuance of financial instruments by “big” banks and may include references to first-class instruments of European or first-class global banks.
Warning signs of HYIP include excessive guaranteed returns, fictitious financial instruments, extreme secrecy, claims that the investment is an exceptional opportunity, and excessive complexity surrounding the investment.
Black money includes all funds earned as a result of illegal activities, as well as other legitimate income that is not taken into account for tax purposes.
A boiler room is a scheme in which sellers use high-pressure selling tactics to persuade investors to buy securities, including speculative and fraudulent securities.
Channel stuffing refers to the practice of a company supplying more products to distributors and retailers through a distribution channel than end users can purchase in a reasonable amount of time.
A letter scam in Nigeria is a scheme in which a sender offers someone a commission - usually via email - for helping them transfer a large amount of money.
Racketeering is the acquisition of a business through illegal activities, the conduct of a business with illegal income, or the use of a business to commit illegal activities.
A fraudulent trader is an employee of a financial firm who engages in unauthorized, often high-risk activities that result in large losses for the firm.