A Ponzi scheme is a dishonest investment scam that tries to manipulate investors with high rates of return and minimal risk. It offers profits for earlier investors with the money that is collected from later investors. They ultimately reach their lowest point when the flood of new investors stops and there isn't enough money for everyone. The plans then fall apart at that point.

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here are six reg flags that can indicate a Ponzi scheme

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• A promise of large profits with low risk that is guaranteed

• A steady stream of returns irrespective of market circumstances

• Unregistered investments with the Securities and Exchange Commission (SEC)

• Clients are prohibited from viewing the official papers related to their investment

• The investing methods are classified as confidential or too complicated to explain.

• Customers have trouble withdrawing their money.