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MetaAshes
Severe risk Ponzi schemes

Guaranteed high-return schemes paid for by new investors' money

A scheme promises a fixed, guaranteed return well above anything a genuine investment can offer. Early investors are paid from the money of those who join later, until new money stops arriving and the scheme collapses.

How the scam works

  1. 01

    A scheme advertises a fixed monthly or annual return, often described as guaranteed, low-risk or market-beating, regardless of how markets actually perform.

  2. 02

    Early investors are paid the promised return on time, which they share with friends and family, bringing in further investors and further money.

  3. 03

    No genuine underlying investment activity generates the returns paid out; the money used to pay existing investors comes directly from new investors joining the scheme.

  4. 04

    The scheme collapses once new money slows or stops, at which point the majority of investors, particularly the most recent, lose the greater part of what they put in.

Warning signs

  • A fixed or guaranteed return that does not vary with market conditions.
  • A return noticeably above what comparable, regulated products pay.
  • Reluctance to explain, in concrete terms, how the return is actually generated.
  • Recruitment of family and friends being encouraged or rewarded.
  • A product or scheme with no verifiable FCA authorisation for the activity being carried out.

How MetaAshes helps you check

A MetaAshes assessment examines the details a firm has given you against the official record. For this type of fraud, the most relevant checks include:

  • Promised returns
  • Regulatory status of the product
  • Withdrawal and release fees
  • Payee name verification

View all 69 checks

If you have already sent money

  1. Contact your bank immediately and explain that you may have been defrauded.
  2. Report it to Report Fraud (formerly Action Fraud) on 0300 123 2040. In Scotland, call Police Scotland on 101.
  3. Report the firm to the Financial Conduct Authority.
  4. Be wary of anyone who later offers to recover your money for a fee.

This alert describes a general type of fraud for information only. It does not refer to any particular firm and is not financial or legal advice.