Ponzi schemes

but43r

Are Ponzi schemes legal in Ireland?
If not - where can I report them?

coylemj

What makes you think that it's a Ponzi scheme?

but43r

coylemj wrote: »

What makes you think that it's a Ponzi scheme?

It's more like a pyramid scheme than a Ponzy scheme I think (not too sure).
Would like to report it though.

ldxo15wus6fpgm

I'd say the financial regulator could help you, or the National Consumer Agency.

Manach

BTW, we are already aware of the Social welfare system:rolleyes:

Jev/N

You mean Madoff schemes? :pac:

Delancey

A ' Ponzi Scheme ' can be pretty much automatically considered to be illegal - by definition such a scheme refers to monies invested being fraudulently withdrawn and paid out to those who have earlier invested - in laymans terms it's called ' robbing Peter to pay Paul ' .
Investors receive what they think is a return on an investment but is in fact money invested by others.

A Pyramid scheme is characterised by large returns being promised but to realise these promised returns the ' investor ' has to recruit a minimum of X number of new investors/sellers.
Example : John must recruit 20 more people , they in turn must each recruit 20 more who in turn must recruit 20 more each.....this is in effect a geometric progression and in theory the scheme would collapse when the whole population has been sucked in and no more investors are available , in practice these schemes collapse long before this ' saturation ' point is reached.

So OP , are you talking about a Ponzi or Pyramid scheme ?

but43r

Delancey wrote: »

A ' Ponzi Scheme ' can be pretty much automatically considered to be illegal - by definition such a scheme refers to monies invested being fraudulently withdrawn and paid out to those who have earlier invested - in laymans terms it's called ' robbing Peter to pay Paul ' .
Investors receive what they think is a return on an investment but is in fact money invested by others.

A Pyramid scheme is characterised by large returns being promised but to realise these promised returns the ' investor ' has to recruit a minimum of X number of new investors/sellers.
Example : John must recruit 20 more people , they in turn must each recruit 20 more who in turn must recruit 20 more each.....this is in effect a geometric progression and in theory the scheme would collapse when the whole population has been sucked in and no more investors are available , in practice these schemes collapse long before this ' saturation ' point is reached.

So OP , are you talking about a Ponzi or Pyramid scheme ?

It's actually a Pyramid Scheme - thanks for clearing that up
So - are pyramid schemes illegal in Ireland?

Delancey

To my knowledge Pyramid Selling is indeed banned in Ireland , not sure of the legislation nor indeed what State body is charged with enforcing the rules.

but43r

Delancey wrote: »

To my knowledge Pyramid Selling is indeed banned in Ireland , not sure of the legislation nor indeed what State body is charged with enforcing the rules.

Interesting - tried to search online and can't find anything on them...

Indricotherium

Delancey wrote: »

A ' Ponzi Scheme ' can be pretty much automatically considered to be illegal - by definition such a scheme refers to monies invested being fraudulently withdrawn and paid out to those who have earlier invested - in laymans terms it's called ' robbing Peter to pay Paul ' .
Investors receive what they think is a return on an investment but is in fact money invested by others.

A Pyramid scheme is characterised by large returns being promised but to realise these promised returns the ' investor ' has to recruit a minimum of X number of new investors/sellers.
Example : John must recruit 20 more people , they in turn must each recruit 20 more who in turn must recruit 20 more each.....this is in effect a geometric progression and in theory the scheme would collapse when the whole population has been sucked in and no more investors are available , in practice these schemes collapse long before this ' saturation ' point is reached.

So OP , are you talking about a Ponzi or Pyramid scheme ?

You have just described exactly the same thing twice using different words.

ResearchWill

Consumer protection act 2007 deals with pyramid schemes, http://www.irishstatutebook.ie/2007/en/act/pub/0019/index.html

Further info here http://corporate.nca.ie/eng/Business_Zone/Guides/Consumer_Protection_Act_guide.pdf

Delancey

Indricotherium wrote: »

You have just described exactly the same thing twice using different words.

Obviously the differences in the 2 are too subtle for you to grasp

coylemj

Indricotherium wrote: »

You have just described exactly the same thing twice using different words.

No he hasn't, a Ponzi scheme is typically a savings and investment scheme, there are typically no 'hard' goods involved whereas pyramid selling always involves some class of tangible item (usually of dubious worth) for sale through 'multi-level marketing', the term the promoters typically use.