So You Want to Invest in a HYIP/Ponzi Program?

[btcmania]

So You Want to Invest in an HYIP/Ponzi Program?
UPDATED MARCH 26, 2014



Revision Log

March 25, 2014 - Added information on Chain Ponzi's, updated Why Do People Invest in an HYIP
March 26, 2014 - Added list of trusted/untrusted chain Ponzi websites

Introduction

First of all you should never invest into any online program with money you aren't prepared to lose. I've heard of people selling their cars or investing life savings, only to lose it all in the end. So don't invest your life away on these high risk programs.

HYIP stands for High Yield Investment Program, a Ponzi-type program which promises an attractive rate of interest for a relatively short time investment. The typical period of a HYIP investment cycle is between 30 days and 60 days.

All information presented below represents my opinions and should not be taken as being the opinion or statement of Bitcointalk.org

Why Do People Invest in an HYIP

There are two types of people involved in HYIP investments.

1) The quick in and out investor : This person is aware of the risks, expects the HYIP to disappear at any time and will invest his money as close as possible to the HYIP's startup date in order that he can exit the program as quickly as possible.

2) The ignorant investor : This person is unaware of the risks, and invests based solely on the information presented to him or her on the website. No background check is done through HYIP monitors, Google searches or forums related to HYIP investments. These are the investors who stand to lose thousands of dollars.

Self disclosure: I lost 0.80 BTC in two investment sites promising high returns. This guide is for the #1 type of person mentioned above. If, after reading this guide, you choose to become the #2 type of person - you've been cautioned.

Personally I am against paying into these programs. They are based on deceit, false information and faked identities. Those who gamble their money knowing the site is a fraud, are making these websites profitable for those who operate them. These people don't just operate one website. They return time and time again to continue under a different name. I would be alright with this if everybody that invested KNEW that they were investing into a scam. Unfortunately honest people who are unaware of the scam also end up suffering financial losses.


Chain Ponzi's

There are two basic websites when it comes to Ponzi's. The first is the investing website which promises outrageous returns on investment. You might find the company representing itself as an IT firm, Bitcoin investment fund, real estate company, Forex trader or other financial institute. The second type of Ponzi site is what I call the 'chain Ponzi'.

Chain Ponzi's work much the way a chain letter works. One person invests money into the chain, another person follows and part of his investment goes to the first person in the chain.

For example:

• Fred invests $100, John then invests $50. Fred receives $150 (his own investment plus 50% coming from John's money).
• John waits until Sam comes along and Sam invests $200. John then receives $75 (150% profit).
• Sam then has to wait until Bob invests $50 and Mark invests $100. Sam receives $300 profit.

This is the chain in action. A new investor (or multiple investors) are needed to cover what is necessary to pay the last investor. Should new money stop flowing into the system, the Ponzi will fail. Bitcointalk forums advertise various forms of this type of Ponzi. As long as new money flows in, profit can be made.

There are risks associated with this type of website:
- there may be a cycle (time limit) on the chain where it will end in one week or other timeframe. Those who have not received their return on investment before the time expires, lose their investment.
- dishonest website operators

As long as all the players understand the risks involved, it can be a profitable and even fun venture.

The following websites have had their results VERIFIED on the blockchain:

Website

URL

Positive

Negative

Tested by myself

Identifying Risks

While you should go into HYIP programs expecting they will one day disappear, there are some signs to look for to recognize if this is going to be a potentially long-term program or a quick grab and dash. In either case remember what I have said - invest only what you are prepared to lose.

Some HYIP programs have been successfully operational for over a year, others lasted no more than 15 days.

1) Check the website's http://www.whois.com information to determine who registered the site. In all likelihood this information will be made hidden through commercial services that privatize such information. Ordinarily invalid WHOIS information means your domain could be subject to being removed however when a privatized service is used, the domain information could be bogus and you'd not ever know it. Don't rely on this information except to give you an idea of where the site was registered, and for how long it is registered.

In the case of Twelverized and Leancy (the later involving over $5 million in funds taken), the sites were only registered for ONE year - very short term. [It was only after I mentioned this in a forum post that Leancy changed their domain to expire in the year 2020. Short term sites will not pay for long-term domains.]

2) Does the company have an address?



Would you feel safe investing in a company with the above contact information? Many do. A company based in "London, England" is quite a span of territory to look for if your money goes missing. Companies such as Leancy may also use addresses that don't exist. Never treat an address as a sure sign that the company has a physical location but treat the lack of an address as a sure sign something is wrong.  If you can find an address, try using Google Maps or a Google Search to determine if it's valid, perhaps ask someone who lives in the area. If the address returns to a multi-business building, consider emailing one of the businesses and ask them if they could confirm that this HYIP firm is in the building.

3) The famous certificate.




Many companies that solicit your hard earned money will feature a 'certificate' on their website. These certificates are purchased for 15 British pounds through Companies House. The Companies House website is available here:
https://companieshouse.gov.uk/

Using the website you may search for a registered company by their registration number. Take note that anyone from around the world may create a company based out of the UK using false information. Do not accept these certificates for being credible. In fact in the case of Leancy, they were registered with Companies House in the UK while listing a German postal address. It seems some sites will simply register for the sake of having a certificate, but if the information provided behind the company is bogus that certificate is useless isn't it?

4) Who are the players?


First and foremost, who runs the site?

Leancy's main PR person is a "Ryan L Roth"
Twelverized's main PR person is a "Mark Ferreiro" and the manager was a Mr. Farid Lee.
21days.biz main PR person is a "James K Hull" from Chicago.
Stemcelltechs main businessman is a "Martin Schreiner"

Sounds good, we have actual names to go with the firm. Now try Googling "Ryan Roth", "Farid Lee" or "James Hull" and see if you can find any of them on the internet. Sure you'll find the generic names but you won't find any association with an investment firm.

Twelverized

In the case of Farid Lee (Twelverized.com) you won't find anything at all.

When I publically questioned Twelverized on their Facebook page as to why there was absolutely NO information on the internet about Mr. Lee, I was told by Mark Ferreiro that Mr. Lee was "not obligated" to provide any information about himself. I responded that while that may be true, it was unusual that Mr. Lee had "21 years" in investing yet there was no internet footprint about him. Another caution sign: Mark Ferreio and Farid Lee both registered on Facebook on March 2nd, 2014 just ONE DAY before Twelverized opened.

If the administrator or head PR person of the HYIP you're looking to invest in, has been around Facebook as long as your loaf of bread in the kitchen, I'd be very cautious.

Leancy

Ryan L. Roth cannot be found, at least having anything to do with public relations and/or investments.

StemCellTechs.com

See if you can find any mention of a Martin Schreiner and stem cell research, other than their HYIP website.

21days.biz

Let's take a look at 21days.biz and a closer look at James Hull, the administrator of their Facebook page.



Would you look at that? This James Hull from Chicago, Illinois also happens to be an identical twin for a doctor William Neary out of the UK. What's even more incredible is that the background is identical. Amazing! And these guys want you to trust them with their funds?

ARGH! I give up, will someone show me a legit company!!!!!!!!!!!!!!!!


What? You suggest Barclay's Royal Club? Okay let's try them out.



Well right off the bat I see a glaring problem. It seems that Dr. Marsh suddenly changes his name to Dr. Warfield in the second sentence. Maybe it was just a typo, perhaps there is still trust to be found with Barclay's?




ARGH! DAMN YOU INTERNET, CAN YOU NOT FIND ME A REAL PERSON?



^ I'm pretty sure that actress Meryl Streep is not working for Barclay's nor has she changed her name.


I'd estimate that 99% of all HYIP's use fake registration information, fake profiles and fake names. But hey, you can trust them with your money right?


Let's take a look at United HYIP League. Granted they do have an address for the company which I could not confirm. Their "PR Consultant" however is 100% bogus, a stolen photo of a model.



Which brings us to our next chapter....


Photo Theft

In the above section you saw that I was able to find fake images used by these HYIP sites.

Determining if a photo has been used from another source is not difficult to do with Google. Keep in mind that some photos may be taken from websites not indexed by Google so you may not always be able to determine if a photo is authentic.

Let's begin with Leancy's PR spokesman, Ryan L Roth.



Okay, this company has a spokesman, he looks reputable... you might be able to trust him with your money.


STEP 1: Save the image to your computer.



Now for this particular image you're unable to right click and save it. What I did was captured the screen by pressing Print Screen and then cut out the image and saved it to the computer separately. Ordinarily you would just right click and save the image to your computer.

STEP 2: Go to Google Images



STEP 3: Click on the camera icon and select "Upload an Image"



And Google will tell you that the photo belongs to an unsuspecting Google+ user:
https://plus.google.com/117881706355020970177/about


Women promoting HYIP

Women don't lie to us right? Surely they must be honest. There seem to be quite a few women who are involved in HYIP promotion, many of whom are naturally gifted with beauty. I wonder though, are these women REAL? Or are they shady people operating with ulterior motives? Perhaps paid to promote for a HYIP, perhaps part of the HYIP itself?

I can't say what their intentions are, but I can tell you that many of these well known promotors of Ponzi's are not who they appear to be. They follow one HYIP program to another, always there, always promoting them. I suspect they are really administrators, but that's only my opinion.


Let's see who she really is...



Aaaaand take your pic from at least five names, most of them Russian.




Here's another HYIP promoter:

Let's see who...



she really...



...is



So while you're looking for a place to lose your money to invest in, just remember that more than likely you're dealing with wolves promoting in sheep's clothing (or men with women's photos).


Recourse

As much as we leave a digital trail, you'd be surprised as how easy it is for these people to get away with your money. First of all, in order to initiate an investigation you'd have to file a formal police complaint. Since taking part in an Ponzi scheme is illegal in many countries, many victims say nothing.

Even if you were to investigate these financial crimes, the websites tend to operate from offshore locations which are out of legal jurisdiction. This isn't to say that tracing these people is impossible but is certainly a time consuming and expensive process. The best way to avoid being scammed is not to take part in a scam in the first place.


Final Thoughts

It is pretty much a given that if you invest in a 150% profit in 30 days adventure, it's too good to be true. Do you know of many HYIP/ponzis that have been operational beyond a few months? Not many, if any at all. That's because the people who register these sites in places, will always run off with your money. That's why it's a Ponzi!

Sadly there are people who invest in crowdfunding programs and are unaware that they are being caught up in a Ponzi scheme - and they end up losing.

If you do make the decision to invest, I hope the above information will guide to as to which firms are questionable.

Be aware that some people generate a profit by simply promoting these scams, they invest none of their own money - but make money from YOUR referral. A referral usually looks something like this:

www.myponzi.net/index.php?ref=bob111
www.scammer.com/~bob111
www.ripmeoffplease.com/?ref=bob111

In these cases bob111 will receive a percentage of what YOU invest. It's not dishonest, but it certainly does encourage them to promote spamming the hell out of forums. I've accepted these people as friends on Facebook and had them spam my wall within 60 seconds. These are not 'friends', these are opportunists.

Pay attention to:

- Site admins that speak in broken English, many of these scams originate in Russia
- Domains registered in China, hosted in offshore locations, with a UK certificate of incorporation.
- Promises of fast cash in under 30 days
- Staff whose names result in no Google results
- Flashy website clipart of businessmen in suits. You're most likely looking at a balding man in a spaghetti stained T-shirt  being the real admin.
- No contact information
- Some sites will link to HYIP monitors. HYIP monitors show status based on the votes of members and small investments made by the HYIP monitor owners. When investments are working, the votes are positive and the HYIP admin is receiving their investment - and the monitor will display a good result.
- Some HYIP's link directly to the monitor as a sign of trust. Keep in mind though that after a period of about 14 days the HYIP site will have accumulated a lot of money and then the members will begin to withdraw funds. It's this time that the site is likely to run away with your money - and those monitors won't tell you until it's too late.

Regards
Nancy Rigel (btcmania)
[Admin of HYIP watchdog group] https://www.facebook.com/groups/LeancyInvestors/

Disclosure: I was the victim of Leancy. I thought it was legit, I lost hundreds of dollars in the process, hopefully you can learn from my errors.

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[1713952022]

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[RGBKey]

A fool and his money are soon parted.

[jeremypwr]

what..the..

[btcmania]

A fool and his money are soon parted.

Funny, that was going to be my closing line in the post.

[RGBKey]

A fool and his money are soon parted.

Funny, that was going to be my closing line in the post.

Sometimes no matter how much talking about these things you do, people still fall for them. I was invested in leancy, but I only invested as much as I could lose. In the end, I ended up with about how much I started with. The people that don't think things through usually end up with less money than they started with.

[koshgel]

Comprehensive post detailing why ponzis are indeed scummy. At this point if you are greedy/dumb enough to lose your money in a ponzi, I won't even feel bad.

[bitkanu]

promoter earned money and investor lost their saving in past ! i learn good from leancy scam!

[robattfield]

I fully knew the risk of signing up to Leancy, Barclays Club, and RevenueHourly, but after reading the O.P's thread, i don't think I'll be wasting my time anymore. Over the years I've seen these types of HYIPS, so I just wanted to put some pocket change in to see it for myself. From this point on, I'll stop promoting these programs.

[MrPiggles]

I tried Leancy, got in early March and thought I had time to get out safe. Nope.

Tried Twelverized a few days ago thinking plenty of time, nope. Twelverized indeed... 12 days later they're gone.

So you knew they were a scam, yet you joined in the hope that you would make money and "get out safe" by taking advantage of the greater fool - whoever joined after you?

Knowingly taking part in these scummy schemes is just as bad as starting them, you're still trying to rip people off.

[btcmania]

I tried Leancy, got in early March and thought I had time to get out safe. Nope.

Tried Twelverized a few days ago thinking plenty of time, nope. Twelverized indeed... 12 days later they're gone.

So you knew they were a scam, yet you joined in the hope that you would make money and "get out safe" by taking advantage of the greater fool - whoever joined after you?

Knowingly taking part in these scummy schemes is just as bad as starting them, you're still trying to rip people off.

No I had actually believed their marketing (with some apprehension) until I learned what a Ponzi was. Now I educate others.

[btcmania]

These guys like to use doctor/medical photos for their fake admins... what else do they lie about?

Go ahead, invest with them.

[zolace]

Thank you for posting this to fight the ponzis in these forums, there nothing but a group of conmen looking for an opportunity to bump, promote to make money from you. Thank you for this posting.  I been warning others but seems many of them are kids.

[MrPiggles]

I tried Leancy, got in early March and thought I had time to get out safe. Nope.

Tried Twelverized a few days ago thinking plenty of time, nope. Twelverized indeed... 12 days later they're gone.

Why did you think you'd need time to "get out safe" if you fell for the marketing and thought they were legit?

You knew it was a ponzi all along

[Rannasha]

The whole OP could be swapped for the following more condensed post:

So You Want to Invest in an HYIP/Ponzi Program?

Introduction

Don't.

The age-old wisdom "if it sounds too good to be true, it typically is" still applies. If a company can prove to have the ability to generate more than 0.2% of profit per day (that's more than doubling up in a year, counting compounding profits), then venture capitalists and other larger investors will be falling over eachother to invest. Which is much simpler and cheaper for said company, since that way they don't have the meddle with deposit/withdrawal systems, support, etc...

All of these programs, no matter how they wrap it up with nicely believable background stories, well written analyses, pictures of good looking people, etc... are scams.

The sad, but simple truth.

[btcmania]

I tried Leancy, got in early March and thought I had time to get out safe. Nope.

Tried Twelverized a few days ago thinking plenty of time, nope. Twelverized indeed... 12 days later they're gone.

Why did you think you'd need time to "get out safe" if you fell for the marketing and thought they were legit?

You knew it was a ponzi all along

No it was only after I'd send the coins that I began to research the company and realize my error.

The focus of this thread is to warn others not to justify myself, particularly to a Mr. "Piggles" (lawl). So I'll be ignoring you from here on in.

[MrPiggles]

No it was only after I'd send the coins that I began to research the company and realize my error.

The focus of this thread is to warn others not to justify myself, particularly to a Mr. "Piggles" (lawl). So I'll be ignoring you from here on in.

I posted in the Leancy thread, it seems a week before you ever invested I made a post warning it was a ponzi. People either ignored it, or criticised me for pointing it out.

so "lawl" at you, for ignoring people pointing out it was a ponzi.

Either

1) You are massively retarded and genuinely didn't realist it was a ponzi despite people posting in the thread "this is a ponzi" plus people all over the forum saying "this is a ponzi" plus people all over the web saying "this is a ponzi".

2) You knew it was a ponzi (which fits with your publicly admitted plan to "get out safe") and you just wanted to scam later adopters, you got your fingers burnt and are now butthurt that you didn't manage to scam anyone, in which case you deserve to lose your money.

[btcmania]

1) You are massively retarded and genuinely didn't realist it was a ponzi despite people posting in the thread "this is a ponzi" plus people all over the forum saying "this is a ponzi" plus people all over the web saying "this is a ponzi".

2) You knew it was a ponzi (which fits with your publicly admitted plan to "get out safe") and you just wanted to scam later adopters, you got your fingers burnt and are now butthurt that you didn't manage to scam anyone, in which case you deserve to lose your money.

Calling someone retarded and then going on to say "didn't realist" rather than "didn't realize" (or 'realise') is mucho funny. lawl! lawl!


Can I add an option #3? I can? Thanks piggy.

3) I didn't read the Gambling forum at the time, and if I had I'd probably have not even found the post in question with all the junk in there.

Anyway you can have options one and two and I'll have option number 3. I'll consider the conversation over, because I don't like to argue with people such as yourself who are intellectually challenged. Also, I don't feel it necessary to explain myself to you further, nor concern myself my your thoughts. Be sure to write back though just to show that you care.

LAWL!

[MrPiggles]

Hahaha, the best comeback you have is to point out a typo.

As I pointed out in the post which you just quoted, it was all over this forum and the rest of the web that it was a ponzi. You managed to miss every warning and lose your money in it despite that. It wasn't a single post in the gambling section. It wasn't even anything to do with posts about Leancy, anyone with 3 brain cells could spot that no site was going to take $2 investments and "crowdfund IT start-ups" with it.

So options 1 or 2 still stand, option 3 is clearly not the case.

http://lmgtfy.com/?q=how+to+spot+a+ponzi

[MrPiggles]

I thought you were going to ignore me 2 posts ago?

You misunderstand my post, which isn't surprising considering you fell for the Leancy sales pitch.

It wasn't just me, it was all over the web, and it was apparent to anyone who isn't retarded.

You either fell for an obvious scam, and are retarded - or you wanted to get in on a scam and rip off other people, and you failed, either way you lose. 

[shorena]

I would like to add

http://leancy-refund.tk

to the list of sites to avoid. These guys are taking advantage of victims of Leancy with ridiculous rates and already reports of non-payment.

SCAM

Code:

295% after 30 minutes
665% after 3 hours
1885% after 8 hours ( Special for those who lost much money )

What would they have to invest in to make almost 300% in 30 minutes?

Well, thanks for the lengthy and great post. Did know most of it, but the method to search for pictures within google. I usually use tineye for that, but I imagine google is better for that.